Zara’s 300 designers

When it comes to competition from US push manufacturers, Zara has nothing to worry about and for two reasons. The first is that push manufacturers fail to recognize the salient differences between their own model and that of Zara’s and second, Zara is not a push manufacturer; they’re pull. Lest the latter statement leave my readers aghast -after all, Zara doesn’t pre-sell their styles according to market schedules- I’ll simply state for now that Zara’s model is so unique and particular to the vagaries of apparel as opposed to other kinds of manufacturing, that the expansion of the term”pull manufacturing” begs another, more comprehensive definition. Oh that any of us could be so unique as to require the redefinition of terms! The first necessity is to define the differences between US push manufacturers and Zara but before I can do that, the article that appeared in the Economist bears clarification. In that article, it was stated that Zara has 300 designers. I think it’s more likely that something was lost in translation or was simplified for a broad audience because if they truly have 300 designers, that means that the average number of styles produced per designer per year is only 36 styles as the company only produced 11,000 styles last year. That is definitely not lean and more typical of push manufacturers than not. A related point of confusion arises as it was indicated that Inditex itself -Zara’s parent company- employs the 300 designers but Inditex is comprised of seven separate business units, of which Zara is only 70%. This could mean that only 70% (I realize that’s a crude comparative but there is no way to determine the actual figure based on current information) of the “300 designers” who work at Zara making for a total of 210. This figure seems more realistic based on the annual production of unique styles (the aforementioned 11,000).


Still, I still find it incomprehensible that there are 210 designers working there. That would mean each designer put out 52 designs per year which is appalling performance (albeit typical of push manufacturers). Again, if the latter is true, there’s lots of slop in Zara’s development and I could only expect those numbers to improve to the detriment of push manufacturers the world over. A range of 200 to 400 styles per designer per year depending on the type of garment would be closer to target productivity. Rather, I think it’s more likely they have 210 people working in design, in other words, a total of 210 designers, pattern makers, technical designers, sample makers, and CAD operators working in the product development department. That seems more likely, still that’s not accurate either because there’s administration of the design system and what percentage of the 210 are included there -if any? If one assumes the worst, that it is true that Zara employs 210 designers (or close to that figure), push manufacturers the world over are in much worse position than ever. If Zara’s output is that prodigious with that much slop -because they will improve- with respect to design staff, push manufacturers are never going to catch up.

Similarly, the issue of work assignment =most assuredly in teams- is unclear which prevents knowing their level of lean. The issue of work assignment is pivotal because Zara -like other pull manufacturers- runs small batches (small was undefined but described elsewhere as batch sizes of 300-500 units) and small batches are so poorly administered by push manufacturers to the extent they cannot do them at all (cost effectively). It is likely Zara’s product development teams are sized in scale -proportionately- to style batch size. The evidence of which can be gleaned from the fact that the assignment of production sewing is assigned amongst small sewing co-operatives. It only makes sense that Zara’s design teams, batch sizes and sewing units are sized comparatively and in direct relationship to each other for maximum efficiency. I am aware that the relationship between batch size, sewing units and product development team size could fill a book but that is not the subject of this post and I’ll have to let that go for now. More to come.

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14 comments

  1. claudia says:

    i’ve always been amazed at how zara conquers another country a day- any tales to tell would be appreciated! (almost like soapies for me :)

  2. Ayiku says:

    I am doing a research on the inventory management policies of Zara. Basically I am doing a critical study of those policies and make a recommendations as to how to improve them. To start with, I want to identify the problems with the present inventory management policy/system and then make recommendations.
    Can anyone offer a help with an additional (relevant) article on the above areas?.
    Thanks, Ayiku

  3. Georgene says:

    It is highly unlikely that Zara runs or owns any factories. My guess is that they source all of their goods around the world. The design work may be coming out of central HQ, but all the goods would be contracted to factories elsewhere. It would be up to the idividual factory to manage the supply chain for any particular item.

    Zara may have inspectors or even contract the inspection process with a firm like SGS. All they care about is having the correct item in the box sent to their warehouse on time.

    I worked for a company that made goods for El Corte Ingles, one of the other Inditex retailers with shops in Spain only. We suffered the seasonal advent of huge teams of buyers in the showroom, and the process of submitting samples for photography and production approval on a strict schedule.

    The process of lab dip approval, style approval, and graded specification approval was very rigorous. However the quantities were very good, and the buyers were very knowledgeable. They obviously had their buying plan and color stories all mapped out before hitting the market. Zara may follow some of the same procedures.

    300 designers? I think not! Not as employees on staff.

  4. Kathleen says:

    I am doing a research on the inventory management policies of Zara. Basically I am doing a critical study of those policies and make a recommendations as to how to improve them. To start with, I want to identify the problems with the present inventory management policy/system and then make recommendations. Can anyone offer a help with an additional (relevant) article on the above areas?

    Hi Ayiku
    Your question opens a whole can of worms. It sounds to me that you’re hoping to consult or advise them with regard to improving their management of inventory. The answer is real simple. They don’t. I mean, they don’t manage inventory. They don’t manage inventory because they don’t have any. How’s that for cost savings?

    How much do you know about lean manufacturing? Zara is a lean producer. Lean producers don’t create inventory. Inventory is a form of waste (muda). Zara delivers completed product directly to the stores that ordered it as soon as it is finished. The whole shooting match, sketch to finished product in about two weeks. Their cycle time is extraordinary.

    I’ve written extensively about Zara, their process and lean manufacturing on this blog and I couldn’t begin to include links to all of the posts here. You can use the search feature on this blog (upper right hand corner) to find relevant posts using these key words: lean, Zara, kaizen, poka yoke, muda, waste, which have I missed? There’s even a category for lean manufacturing. Lean manufacturing is a keen interest of mine. The manufacturing model that I espouse and teach to others is strictly lean. No push manufacturing around here.

  5. Ayiku says:

    Zara’s policy of lean production through ‘take a few to the market’ is not only costing Zara very high transportation cost but also created an artificial scarcity and less variety to it’s customers. However, it is believed by some, including Zara, that this policy is much more of a benefit especially in terms of higher sales than otherwise. Do you agree?

  6. Eric H says:

    Ayiku;

    1) “Take a few to the market” is known as “Just In Time”. Yes, the transportation cost may be higher (they aren’t), but you must consider the fact that their storage costs are 0. They pull rather than push. There is no inventory to manage. You really need to get a copy of Lean Thinking by Womack et al and study what lean means.

    Your “very high transportation cost” is based on the false assumption that they are sending smaller batches and therefore emptier trucks (and possibly more often). Examine your premises. Let’s say a truckload is 100 units, and the average push operation sends a truckload of one style, another truckload of another style, etc., up to 5 styles., and those each take 5 weeks to sell (20 units/week of each style). You could say that they are efficient from a transportation point of view. But that’s 5 weeks + manufacturing time + storage at the manufacturing point + storage time of raw materials from the time they paid for the materials and labor to the time they get paid by a customer. Zara sends 20 units of 5 styles in one truck and get paid in a week. The trucks are just as full. They ship more often, but 1 truck once per week requires exactly the same amount of fuel and labor as 5 trucks every 5 weeks. And not only does Zara eliminate storage, but their sell-through is higher. How?

    2) Artificial scarcity is the point of Zara’s strategy! Look at Kathleen’s post on the subject: both The Economist and Paco Underhill (quoted in her post) understand that this lets Zara extract the full retail value of each garment. Their competitors actually ship clothing with the discount tags attached. That 5 truckloads every 5 weeks doesn’t look very efficient now, does it?

    3) Zara is renowned for their wide variety. Where in the world did you get the idea that they provide less variety? That variety plays perfectly with the lean development process and the short turnaround/constant restocking. You never have to ship half-empty trucks if you have a wide variety of items that are sold before they ever ship.

    If you want to study someone in need of improvement, try The Gap. They think that changing the color of their floors is going to create sales and profits. How could you top improving Zara? Are you going to suggest improvements to Toyota’s quality control system next?

    If you want a relevant article, read the post I linked above, Lean Thinking, Paco Underhill’s two books (links in the right sidebar —>), subscribe to this blog and EvolvingExcellence, and search through The Economist for references to Zara. I think you’ll find that your chosen research subject is going to prove fruitless.

  7. Kathleen says:

    Ayiku,
    I’m going to say this as nicely as I can. We are happy to answer questions around here but before you come back and post still more questions (he’s been emailing me privately too), do the reading recommended from the first question. It’s obvious you haven’t. Once you RTFM and understand the ABC’s then it is easier for us to fill in the blanks (actually, you won’t even be asking those questions at all but entirely different ones). We don’t mind helping but please do your share of the work first. Thank you.

  8. natalie shoshan says:

    Hi, i am doing some research on zara and how strategic management accounting helps the short product life cycles of the clothes. Does zara use abc costing and if so how does this help them? do they use competitor analysis??

  9. Raquel says:

    Hi! I am doing some research about the in-store marketing used by Zara. Where do you think I could find some info about it?The only thing I know is that their advertising are their own stores but I can’t find more info on how this benefits them

  10. romeo says:

    hi,

    I was really impressed with what was written. You seem to have a lot of knowledge of how things work in zara. The story is that sometimes when i walk into zara, I find some items that are really similar to the high end brands in the market which confuses me a little on whether zara designs or trends? What I mean is, does Zara design or does it copy what has been created by the high end fashion designers? If it does copy, then it must need stylists or trendors to do this job, so where can I find such trendors?

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