1) What is Zara's fundamental business strategy? Is it simple? What are the principles for Zara's business operation?
Fundamental business philosophy of Zara
The fundamental business strategy of Zara is very simple which is linking customer demand to manufacturing, and liking manufacturing to distribution. Zara has been running their business in fashion industry which is susceptible to seasons and quick changing customer tastes. Zara has been approached to and considered their business as a perishable commodity business just like a fresh baked cake or bread to be consumed quickly.
Thus, the main business tactics of the company in context of this business philosophy is ;
[ Short lead time ] More fashionable clothes and embracing quick changing customer's tastes
[Decentralized Management] Taking advantage of the intelligence and trust the judgment of employees
[Lower quantities] Inventory will be formidable burden in perishable products
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