Zara: Taking the Lead in Fast-Fashion
April 12, 2006 | Levent OZLER
When it comes to quick response to clothing trends, this Spanish retailer is beating the pants off H&M and everyone else.
Zara's secret? It moves fast.
With an in-house design team based in in La Coruna, Spain, and a tightly controlled factory and distribution network, the company says it can take a design from drawing board to store shelf in just two weeks.
That lets Zara introduce new items every week, which keeps customers coming back again and again to check out the latest styles.
Zara's success is all the more surprising because at least half its factories are in Europe, where wages are many times higher than in Asia and Africa.
But to maintain its quick inventory turnover, the company must reduce shipping time to a minimum.
The fast-fashion approach also helps Zara reduce its exposure to fashion faux pas.
The company produces batches of clothing in such small quantities that even if it brings out a design that no one will buy -- which happened during an unseasonably warm autumn in 2003 -- it can cut its losses quickly and move on to another trend.
more: businessweek.com/globalbiz/content/apr2006/gb20060 (1,456)
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