Zara Case Study
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MKTG 310
February 10, 2012
Page 1
Zara Case Study
As completely as possible, explain the supply chain for Zara from raw materials to consumer purchase.
If you search definition of supply chain the meaning would be “the network of retailers, distributors, transporters, storage facilities and suppliers that participate in the sale, delivery and production of a particular product” (
There are 200 people responsible for design and product development; each person designs 1-2 items per week totally a 1000 designs a year (
Page 2
Discuss the concepts of horizontal and vertical conflict as they relate to Zara.
Horizontal conflict is “the effect of increased competition among business, typical retailers, operating within the same market space. Horizontal conflict often leads to
reduced profit margins and crowding out smaller retailers which can ultimately drive down the supply of products” (
Vertical conflict is “organizational disagreements between individuals or groups at different hierarchical levels” (
Stores might not get the desired or “hot” items before they are discontinued also. Horizontal conflict can occur especially with Inditex; the constant changes lead to extra costs and what should be done to absorb them, where to expand, the research and design people might have conflicts with fashion choices, there might be conflict within the subcontractors and the amount of work or the type of work they are getting; there is a possibility of conflict happening everywhere. With Zara controlling a majority of the components I think that would lessen the conflicts by not having to deal with “outsiders”.
Which types of vertical marketing system does Zara employ? List all the benefits that Zara receives by adopting this system.
Zara uses corporate and contractual vertical marketing systems. The benefits of the corporate side include their control of their own manufacturing and distribution (Kotler, 344). Zara