Zara - could they do this if they were not vertically...

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Zara Vertical integration= no integration, upstream integration, downstream interactions Cost: Control : impact of asset control, which ca impact barriers to entry and which can assure cooperation of key value adding players Coordination : More efficient operations than the others. High investment in IT (communication), factory, distribution, **Lower mark downs, than other in the industry How does Zara succeed to minimize the quantity of excess inventory and the impact of mark-downs? -better data collection -Acting upon this information (ability to design fast, ability to produce fast and ability to deliver fast) Since they don’t outsource
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Unformatted text preview: could they do this if they were not vertically integrated? Higher manufactureing cost is part of an overall strategy-Zara’s management goes against common industry practice-offer high fashion for low price-high quality control -don’t advertise--outsource less than others vertically integrated so have their own chain, don’t work with others upstream strategy-commitment to fliexiblity heavy capital investmenst, delayed commintment to specific products quick respose downstream strategy: focus on boosting traffic, margins and turns to compensate for heavy capital investment and no adverstising -...
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