From Spain to China, ZARA continues to write speed myths

From distant Spain to China, ZARA has maintained its mythology of only 15 days from design to sale. Commercial technology has helped it continue its legendary supply chain.

ZARA is here! Since its opening in early March of this year, the ZARA flagship store on Nanjing West Road in Shanghai has been on a daily basis. In this single store with a business area of ​​about 1,500 square meters, sales from one day can soar to 600,000 yuan from time to time. This figure is enough to envy the peers. As a well-known brand affiliated to the Spanish Inditex Group, ZARA’s well-known market position is “affordable and fast fashion”. Perhaps the latest season of Dior's new dress has just appeared on the Paris T-stage, and two weeks later, the fashionable masculine and faithful women will be able to find the shadow of Dior's latest style in the store of ZARA in a pleasant surprise, and the price may even be very dior. One of them is not!

From design to marketing, ZARA spent only 15 days at the fastest time. In China, Metersbonwe Group Co., Ltd. (hereinafter referred to as Metersbonwe), known for its fast supply chain speed, currently takes 80 days to complete this process. When ZARA extended its strategic reach to China, the myth of its extremely fast supply chain was magically continued. Although domestic apparel companies are all praising ZARA's supply chain legends, no one knows how ZARA can overcome time and space and defend the myth of speed from distant Europe to China.

In response to the industry’s high enthusiasm, Inditex Group’s China-based company, Laura Commercial (Shanghai) Co., Ltd. (hereinafter referred to as “La Mera Shanghai”) maintained a consistent silence and mystery, refusing to accept interviews from any media. After painstaking efforts, this reporter has revealed how ZARA will replicate its overseas success model in China under the boost of commercial technology.

Exploring Chinese stores

Ten o'clock every morning, the ZARA flagship store on Nanjing West Road will be open on time. Although thousands of pieces of clothing are on display in the store, it looks fresh and luxurious. The stores are divided into three areas according to women's wear, men's wear and children's wear. The shopping space is also very spacious, adhering to the concept that ZARA is always good at creating a comfortable shopping environment.

Although the number of single items is not much, but the style is rich and varied, this is the characteristics of ZARA. In order to create scarce value, ZARA is always launching new products in small batches. Therefore, ZARA fans can always find that a new product is only a few pieces, if not immediately “shopping”, it is likely to disappear on the shelf forever next time. However, even if there are countless fashion people coming here every day, ZARA's shelf will always be full of dazzling array of clothing.

"Every half hour, the heads of ZARA women, menswear and children's clothing will control and replenish the storefront in real time based on the sales system in the POS machine." Jura's IT provider in China - Jema Computer Information Technology (Shanghai) Co., Ltd. (hereinafter referred to as the Jema company) ZARA project manager Liu Yi told reporters.

In order to build an information system suitable for ZARA, Liu Yi's project team has made many considerations. He noted that ZARA's overseas retail system model is different. In some ZARA stores in Spain, the system architecture is based on a POS machine as the host, other POS machines as an auxiliary machine, all the data are collected on the host, this model omits the server and background support, but the POS machine The amount of storage is relatively small. Reports linked to printers not only affect the results, but also make it difficult to develop more systems. This obsolete model is therefore not suitable for ZARA stores in China.

Zhu Xiaolong, the IT manager of Jura Shanghai, introduced that ZARA's Spanish headquarters is in order to keep abreast of the dynamics of the Chinese market and respond quickly. China’s information system has adopted an “H” architecture at the beginning of its design, ie information for each store. The system is relatively parallel and independent. It is directly linked to Spain. At the same time, the ZARA headquarters in Shanghai will also obtain information about each store through the system.

The information architecture designed by Jiema Company is to build a back office with servers in each store. According to the requirements of different customers, various reports and query functions can be developed, and the front end can have many POS systems. The most important thing is that ZARA stores in China need to send various sales data and reports directly to the Spanish headquarters every night, so broadband has become the most basic configuration of each store.

In the ZARA store on Nanjing West Road, the manager, Devina, always walks around the store with a custom handheld PDA. Although the PDA is compact, it has built-in ZARA headquarters standard ordering system and product system modules, and it also helps Divina maintain close contact with the Spanish headquarters. At ZARA, each store manager has the right to place orders directly with the headquarters. Therefore, when Divina finds a product in stock in her own store's system, she can see suggestions from the Spanish headquarters through a PDA connected to the broadband. Order quantity, and according to their own judgment of the local market, send orders to the headquarters. It is worth mentioning that the proposed quantity of ZARA's Spanish headquarters is a combination of the sales data transmitted by each store every day, and the product manager's estimate of the local market, together with a comprehensive analysis of historical sales data. Since the Chinese market opened its new store this year and there is no historical sales data available, Divina's important job is to communicate frequently with PDAs and Spanish product managers.

This unobstructed communication mechanism and the significance of strengthening the management of a single store is self-evident, it can allow the distant ZARA Spanish headquarters to accurately know the Chinese market information. When ZARA's flagship store in China was just opened, many garments were oversized. The S number for Asians was often snatched on the day of purchase. However, after more than a month, this situation has rapidly changed. When reporters came to the ZARA shop again, they found that many styles provided sufficient small (S) and small (XS) numbers. Obviously, ZARA headquarters has made a rapid response to the Chinese market.

How soon can an order be sent back from China? Through the special order service of ZARA Nanjing West Road, we can calculate the speed of ZARA's rapid response. "The fastest three days!" A clerk told reporters. ZARA's special order service is equivalent to the international transfer function. When customers look for a certain piece of clothing and the store is out of stock, they can apply to ZARA's store manager for a free special order service. Divina will issue orders through handheld PDAs. When the headquarters is not out of stock, online travel from the order until the goods arrive at the store, the fastest time is only three days, so that customers can get satisfactory clothing.

For Divina, the pace of ZARA ordering and distribution is very regular. On Tuesdays and Thursdays, she will place orders in Spain based on the sales of the stores and the orders from Spain. On Wednesdays and Saturdays, on a fixed-to-new day, the goods sent by the Spanish headquarters are sent to ZARA's stores in a timely manner through a third-party logistics agency at Waigaoqiao. Maintaining the single rhythm of the supply chain is also a classic management feature of ZARA. “It enables the entire supply chain to operate at a fast and predictable pace,” according to the Harvard Business Review (HBR). This model is also closely replicated in China. Therefore, like any ZARA store manager in the world, Divina can accurately know the time of arrival—the goods arrive in China within 48 hours after being sent out from the Spanish logistics center.

Spanish headquarters

Every day, when the ZARA headquarters in La Couni, northwestern Spain receives data from China, each department will decompose this information according to their own needs in order to make judgments on the Chinese market.

According to Zhu Xiaolong, these data are a large number of original information, meticulous to each product sold a few orders, size, color, quantity, selling time, payment methods, discount information, price adjustment, etc., almost every country stores Each day, sales data is transmitted to the Spanish headquarters. Therefore, the information platform of the ZARA headquarters is extremely powerful. It not only can process data from various countries and analyze it, but also supports the high-speed operation of ZARA's global business.

In ZARA's design team, this data can help them design for the Asian market. Unlike other foreign brands entering China, all ZARA designs are currently concentrated in Spain. In China, Denise Fashion (Tianjin) Co., Ltd. (hereafter referred to as the "Yozhi Company") from Denmark adopted the design data to be sent from Denmark to China via the Internet, and then the Chinese design team carried out secondary development according to the needs of the local market. Pattern.

Because it is far from China, China's sales and inventory information from the information system is of utmost importance. It can be used by headquarters to analyze the style, color, size, etc. of best-selling or unsalable products, and can be used as a reference for the design of new products. It is worth mentioning that in order to get closer to the market, ZARA has adopted a design model consisting of a team of buyers, designers, and market specialists. Zhu Xiaolong introduced that ZARA's designers often flew to China and participated in some negotiations with suppliers.

The strong design capability of ZARA has been well-recognized in the industry. According to a report, ZARA has designed nearly 40,000 new products each year, and the company has selected 10,000 models to launch on the market. "Small-batch, multi-variety" is the result of ZARA drawing on the production model of Toyota Motor Corporation (TOYOTA, hereinafter referred to as Toyota Motor). Toyota Motor’s creation of this model aims to “eliminate the inefficient labor and waste that may result from excess production, as well as the burden on the personnel and land buildings that manage these stocks.” While “inventory is the enemy of the apparel industry” Under the law, the Toyota Model allows ZARA to reduce its inventory risk and to be more flexible in responding to market changes.

According to a long-term study of ZARA's AMT Enterprise Resource Management Research Center apparel industry consultant Ge Xing introduction, after the design plan was finalized, ZARA completed the tailoring on the company's highly automated cutting equipment, and then these fabrics were sent to some small processing plants in Spain or Portugal. For sewing, ZARA provides these factories with a series of easy-to-execute instructions that allow them to quickly sew clothes.

Clothes from ZARA's foundries located in various countries will be transported to a modern logistics center in Spain's ZARA headquarters for automated sortation and loading, eventually being delivered to various stores via trucks, ships or planes. What is puzzling in the industry is how ZARA can integrate the goods of various suppliers in Spain in the shortest possible time.

Logistics Center?

Zhu Xiaolong told reporters that what impressed him was ZARA's international supplier management system. This system is an online platform for suppliers. They fill in all the basic information above. Through this platform, ZARA's Spanish headquarters can monitor the entire process including delivery, customs clearance, customs clearance and headquarters, and even track logistics. The company's dynamics. In the past, these processes were manual operations, not only inefficient, but also very easy to make mistakes. Most importantly, when dealing with suppliers in countries that are sometimes in Spain's time, the existence of an online platform has smoothed the gap between the jet lags and once again garnered precious time for ZARA.

Layout China

Since entering China in 1995 and opening its first flagship store in Shanghai this year, ZARA has been dormant for 11 years in China. “We have been learning Chinese business rules.” A manager of Jura Shanghai Company refused to disclose ZARA. This 11-year trajectory in China. However, since this conservative Spanish company began to exert its force, its Chinese strategy obviously will not be satisfied with just opening one or two stores. In more than 40 countries, ZARA has more than 700 direct sales stores.

In fact, no matter what country is opening a store, as a fashion trend, ZARA's model seems to have no personality, but it is its biggest personality: the Spanish headquarters through the information system to close stores around the hands, Through a single supply chain rhythm, standard management model, and a single logistics center, ZARA weaves out a centrally radiating centralized network.

It is this strong management that allows ZARA's behemoth to operate in an orderly manner, and business technology has become a powerful engine to support ZARA's business.

Zhu Xiaolong introduced that at the headquarters of ZARA, most of the information systems were independently developed by the IT department of ZARA. The IT team is both familiar with the company's business processes and is proficient in IT technology. Among them, R&D personnel account for three-thirds of the total number of the team. two. Independent development not only ensures that the information system can adapt to the unique business processes of ZARA, but also reduces the cost of IT procurement.

Under the principle of large concentration, the informatization framework of other countries' branches can be fine-tuned according to local characteristics. For example, in the Chinese market, ZARA outsources the development of the retail system to Jema, but the ordering and query system used by the store manager is developed by the Spanish headquarters. “Whether it is an outlet store or opening a store with a partner, outsourcing or self-development, the information system must transmit data to the headquarters in accordance with ZARA standards.” Zhu Xiaolong said.

“This year we will also open a new store in Shanghai and Beijing respectively.” Zhu Xiaolong revealed. (As of press time, ZARA opened its second store in Shanghai Times Square, Shanghai Huaihai Road, with an area of ​​about 1,600 square meters.) Like other retail chain companies, the biggest challenge for him was that How can ZARA China's headquarters in Shanghai strengthen control of its branches in different locations?

As far as ZARA's current information system in China is concerned, the investment in hardware and software of Shanghai West Road Store in Shanghai exceeds RMB 1 million, which is quite expensive in the single-store informatization investment of the retail chain industry. In the design of the informational framework, ZARA has not built a nationwide data exchange and processing platform. Under the current H-shaped structure, data exchange between a single store system and the Spanish headquarters is feasible, but with the development of ZARA in China, once the number of off-site stores is increasing, whether it is due to cost and work efficiency, is it The establishment of a data exchange platform in China, which collects data from all over the world and then transmits them to Spain, has become a problem that has plagued Zhu Xiaolong.

"Everything an information system does is to ensure that ZARA responds quickly to the market!" Zhu Xiaolong said. Due to the fast, ZARA's clothes did not seem to be carefully ironed. Many clothes on the Nanjing West Road shop appeared on the shelves with wrinkles. But for those fashionable believers, if they can wear the new Valentino or Chanel at a tenfold cheaper price, what is the relationship between this and the other?

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About ZARA

According to a Morgan Stanley research report in March this year, its forecast for the average annual growth rate of ZARA's parent company, the Inditex Group, from 2004 to 2014 was 10.9%, compared to The annual average compound annual growth rate of the top five luxury goods groups such as Bulgar, Burberry, Hermès, Richemont and Swatch is forecast to be only 7.7%. According to Bain's survey, 10,000 new products are sold to the market every year. Therefore, ZARA can allow customers to visit the market on an average of 17 times a year.

In Spain, ZARA has 22 factories and 50% of all its products are taken through its own factory. The other 50% were completed by 400 external suppliers, of which 70% were located in Europe and the rest were in Asia.

Through outstanding operations, in 2004, ZARA's global operating income reached 4.6 billion euros, profit of 440 million euros, and the interest rate was 9.7%, which is more encouraging than 6.4 percent of GAP, the largest apparel chain brand in the United States.

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ZARA's Business Technology Secrets

1. Strong control over the stores: Each store has an information system directly connected to the Spanish headquarters. Through a large number of daily sales information exchanges, the headquarters can quickly and accurately control the situation of each store.

2, a single copy of the model: ZARA in each regional market to maintain a single rhythm of the supply chain, the most important is that for each country in each store, whether it is straight or join, ZARA has a strong demand for its use Standardized information system.

3. High-tech logistics center: The logistics center in Spain has a very mature automation management software system that can quickly send goods to the world at a rate of 2.5 million pieces per week.

4. Advanced Production Mode: Adopting Just In Time, jointly developed with TOYOTA, can customize the production process to meet market demand.

5, a powerful supplier management platform: suppliers located in the world can fill in the customs clearance, export data on this platform, ZARA can see the flow of goods in the above. At the same time, networked operations eliminate work delays due to time differences.

6. Strong system development capability: Most of the information systems of ZARA are self-developed. The IT team at the Spanish headquarters is a two-handed person familiar with business processes and proficient in IT technology. Only they can clearly know what systems ZARA wants. , while reducing the company's IT procurement costs.

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ZARA's global delivery speed

(after issuing from the Spanish headquarters logistics center)

Delivery time (hours)

Europe 24

China 48

United States 48

Japan 72