When Amancio Ortega, a former Spanish bathrobe maker, opened his first Zira clothing store, his business model was simple: Sell high-fashion look-alikes to price-conscious Europeans. After succeeding in this, he decided to tackde the outdated clothing industry, in which it took six months from a garment's design to consumers being able to purchase it in a store. What Ortega ervisioned was "fast fashion getting designs to customers quickly. And that's exactly what Zam has donel The company has been described as having more style than Gap, faster growth than Target, and logistical expertise rivaling Walmart. Zara, owned by the Spanish fashion retail group Inditex SA recognizes that success in the fashion world is based on a simple rule-get products to market Quickly. Accomplishing this, however, isn't so simple. It involves a clear and focused understanding of fashion technology, and their market, and the ability to adapt quickly to trends Inditex, the world's largest fashion retailer by sales worldwide, has seven chains: Zara (including Zara Kids and Zara Home). Pull and Bear, Massimo Dutti, Stradivarius Bershka. Oysho, and Uterque. The company has more than 7385 stores in 93 countries, although Zara pulsin more than 50 percent of the company's revenues. Despite its global presence, Zara is not yet a household name in the United States, with just over 52 stores open, including a flagship store in New York City. What is Zara's secret to excelling at fast fashion it takes approximately two weeks to get a new design from drawing board to store floor. And stores are stocked with new designs twice a wook as clothes are shipped directly to the stores from the factory. Thus, each aspect of Zara's business con tributes to the fast turnaround Sales managers at the Cube-what employees call their futuristic-looking head- quarters-sit at a long row of computers and scrutinize sales at every store. They see the hits and the misses almost Instantaneously. They ask the in-house designers, who work In teams, sketching out new styles and deciding which fab rics will provide the best combination of style and price for new designs. Once a design is drawn, it's sent electronically to Zara's factory across the street, where a clothing sample is made. To minimize waste, computer programs arrange and rearrange clothing patterns on the massive fabric roils before a laser-guided machine does the cutting. Zara produces most of its designs close to home-in Morocco, Portugal Spain, and Turkey. Finished garments are returned to the fac tory within a week. Finishing touches (buttons, trim, detailing etc.) are added, and each garment goes through a quality check. Garments that don't pass are discarded, and those that do pass are individually pressed. Then garment labels indicating to which country garments will be shipped) and Security tags are added. The bundled garments proceed along a moving carousel of hanging rails via a maze of tun nals to the warehouse, a four storey, 5-million-square foot new methods that enable store managers to order and dis- play merchandise faster and is adding new cargo routes for shipping goods. And the company has finally made the jump into online retailing buiding (465 000 square metres, or about the size of 90 foot ball fields). As the merchandise bundles move along the rails electronic bar code tags are read by equipment that sends them to the right staging area." where specific merchandise is first sorted by country and then by individual store, ensur ing that each store gets exactly the shipment it's supposed to. From there, merchandise for European stores is sent to a loading dock and packed on a truck with other shipments in order of delivery. Deliveries to other locations go by plane. Some 60 000 items each hour-more than 2.6 million items a week-move through this ultrasophisticated distribution centre. And this takes place with only a handful of workers who monitor the entire process. The company's just-in-time production (an idea borrowed from the auto industry) gives it a competitive edge in terms of speed and flexibility Despite Zara s success at fast fashion, its competitors are working to be faster. But CEO Pablo Isla isn't standing stil. To maintain Zara's leading advantage, he's introducing DISCUSSION QUESTIONS 1. How is strategic management illustrated by this case story? 2. How might SWOT analysis be helpful to Inditex execu- tives? To Zara store managers? 3. What competitive advantage do you think Zara is pursu ing? How does it exploit that competitive advantage? 4. Do you think Zara's success is due to external or internal factors or both? Explain. 5. What strategic implications does Zara's move into online retailing have? (Hint: Think in terms of resources and capabilities.)