https://vimeo.com/218308221
(Music by Ketza - Waxing Waning)
Sunday 7 October 2018
Denim plus - Why are Zara so successful even though they're a fast fashion business?
Why are Zara so successful?
Zara are such a successful fast fashion business, and this is due to their strategy. They have a vertically integrated business model.
What is a vertically integrated business model?
"A vertically integrated business model means that you consolidate multiple steps in the typical distribution process. Instead of operating solely as a manufacturer, distributor or retailer, a vertically integrated company performs tasks commonly carried out by suppliers or trade buyers. Vertical integration has several pros and cons relative to specializing in one business function."[1]
What is a benefit?
"Vertical integration has a few core benefits. One is control. The more activities you carry out in the manufacturing and distribution process, the more control you have over the entire flow of goods until they reach the end customer. You may also benefit from lower costs. If you make goods, you only pay for the costs of manufacturing. When a wholesaler or retailer acquires goods from a manufacturer, a markup is added to the cost." [1]
What do they do?
Having a limited supply has its drawback and advantages, as a customer can feel good because it'll be unique, but if you see a product online and go into store to find it, the chances of it being there isn't very likely. Therefore, if a customer sees a garment in there, they'll buy it almost immediately because the chances of it being there over the next few days is unlikely. That's how they stand out from their major competitors as they encourage customers to buy clothes simply in that way. It's really effective as it doesn't mean that customers put the item of clothing back down, they simply buy it. This also benefits them as a company as they manage to save on it's warehousing and inventory costs.
Zara using 'just in time' as their production technique which is very handy as 85% of their products are kept at manufacturers, which allows them to be flexible in the amount and variety made.
However, for us, Daintree denim, we're a brand that are fast with our fashion choices and which trends we want to be inspired by. We are a brand that is very similar to Zara and their strategy. We have a member staff that analyses trends and listens to your feedback, and we all discuss what trends we think our customers would want. Limited stock is our main aspect as we will make the product once somebody has ordered and paid for their item. Every product is unique so this allows our customers to feel individual and good about themselves. It can take up to 7-10 days to make depending on the workload, and the jeans will be sent out the next day after they've been made, as the items have to be checked. We are a UK business so our channels and manufacturers are in the UK, in our studio, meaning that we don't have to wait for our product to reach us before sending them out to customers, we simply MAKE them. However, some of our added textiles come from other countries, but we try to make sure that they are organic and are eco friendly.
[1] http://smallbusiness.chron.com/vertically-integrated-business-model-68292.html - by Neil Kokemuller
Background research:
https://www.tradegecko.com/blog/zara-supply-chain-its-secret-to-retail-success - by Clara Lu on 4th December 2014
http://kwhs.wharton.upenn.edu/2016/02/zaras-fast-fashion-business-model/
Zara are such a successful fast fashion business, and this is due to their strategy. They have a vertically integrated business model.
What is a vertically integrated business model?
"A vertically integrated business model means that you consolidate multiple steps in the typical distribution process. Instead of operating solely as a manufacturer, distributor or retailer, a vertically integrated company performs tasks commonly carried out by suppliers or trade buyers. Vertical integration has several pros and cons relative to specializing in one business function."[1]
What is a benefit?
"Vertical integration has a few core benefits. One is control. The more activities you carry out in the manufacturing and distribution process, the more control you have over the entire flow of goods until they reach the end customer. You may also benefit from lower costs. If you make goods, you only pay for the costs of manufacturing. When a wholesaler or retailer acquires goods from a manufacturer, a markup is added to the cost." [1]
What do they do?
- Short production time - They react so quickly to trends that they can have the product out on the shelves within a number of days, inviting customers in.
- Tune into the personal taste of it's customers before they ask for it - 200 designers in Spain look at the decisions made by consumers in their stores.
- More styles - they always have a number of different garments with so many different styles, and are always quick enough to pick out the trends fast and have it out on the shop floor within a number of days.
- Lower quantities - only a certain number of items will be for sale, therefore the customer will feel like they're wearing a unique garment.
- Just in time production - make sure that 85% of their products are kept at the manufacturers.
- Sold distribution network - delivers goods to the UK within 24hours.
- Don't advertise, they simply rely on word of mouth.
Having a limited supply has its drawback and advantages, as a customer can feel good because it'll be unique, but if you see a product online and go into store to find it, the chances of it being there isn't very likely. Therefore, if a customer sees a garment in there, they'll buy it almost immediately because the chances of it being there over the next few days is unlikely. That's how they stand out from their major competitors as they encourage customers to buy clothes simply in that way. It's really effective as it doesn't mean that customers put the item of clothing back down, they simply buy it. This also benefits them as a company as they manage to save on it's warehousing and inventory costs.
Zara using 'just in time' as their production technique which is very handy as 85% of their products are kept at manufacturers, which allows them to be flexible in the amount and variety made.
However, for us, Daintree denim, we're a brand that are fast with our fashion choices and which trends we want to be inspired by. We are a brand that is very similar to Zara and their strategy. We have a member staff that analyses trends and listens to your feedback, and we all discuss what trends we think our customers would want. Limited stock is our main aspect as we will make the product once somebody has ordered and paid for their item. Every product is unique so this allows our customers to feel individual and good about themselves. It can take up to 7-10 days to make depending on the workload, and the jeans will be sent out the next day after they've been made, as the items have to be checked. We are a UK business so our channels and manufacturers are in the UK, in our studio, meaning that we don't have to wait for our product to reach us before sending them out to customers, we simply MAKE them. However, some of our added textiles come from other countries, but we try to make sure that they are organic and are eco friendly.
[1] http://smallbusiness.chron.com/vertically-integrated-business-model-68292.html - by Neil Kokemuller
Background research:
https://www.tradegecko.com/blog/zara-supply-chain-its-secret-to-retail-success - by Clara Lu on 4th December 2014
http://kwhs.wharton.upenn.edu/2016/02/zaras-fast-fashion-business-model/
Denim plus - Fast fashion for landfill
Fast fashion is the newest thing. Over a decade ago, fashion wasn't like this, fashion wasn't fast like this. Everybody would be wearing the same clothes, as those clothes would be in the shops for weeks, wheras now, they'd be in there for about a week, then new stock comes in and new garments are out there. The design and manufacturing process literally takes a week, from it being a design, to being at the manufacturers in China, to being out in the shop.
What are the positives and negatives of fast fashion?
Positives:
- Allows people to be individual as they so much choice between what clothes they should be.
- More affordable versions of the latest trends that are out there.
- Them being more affordable means that they'll be more accessable
- More choice on where to buy a particular item of clothing from as they'll be in most shops as well as being online.
Negatives:
- Massive increase in textile waste.
- Some of the garments can't be recycled meaning that they'll go to landfill.
- More rivers being dyed blue due to more denim being made.
- Items of clothing are made in low income countries, so they have to travel to get to the shops which means more pollution.
- Items of clothing aren't being worn enough but they get thrown away/recycled.
- If the garment is made from polyester, it will take 200 years for it to breakdown even in landfill.
There are so many drawbacks with fashion being so fast, but the main thing is that landfills are worse than ever before. More landfill sites are being taken up with our clothes that can't even be used or recycled elsewhere. Last year, H&M sold $24.5 billion worth of clothes in that year, but also took back 12,000 tons of clothes. [1] That's a fair bit of clothes! The U.S Environmental Protection Agency says, "In the U.S, American's dispose of about 12.8 million tons textiles annually, which amounts to about £80 for each man, woman, and child."[1] That's so much waste that gets taken to landfill, soon we won't have any place for it to go, especially if that number will start to increase. Not all of the textiles that are used to create these garments aren't recyclable, like polyester. If dupes or other organic materials were used, this wouldn't be a massive bother or a problem in today's world.
Nowadays, everyone buys clothes monthly, and sometimes that item of clothing doesn't even get worn/worn that much before it gets thrown away. According to Juliet B. Shor, "In 1991, the average American bought 34 items of clothing each year." [2] Only 34 items a year? I know for a fact I buy way more than that and i'm a student. She also said, "By 2007, they were buying 67 items every year." That's pretty much double what it was in 1991. It's showing how fast our fashion is nowadays. I'd be scared to look at the current figures as I know that would've increased implying more environmental factors that need to be taken into consideration.
We need to be careful with what clothes we buy and where we buy our clothes from, because fast fashion isn't the main problem, it's us consumers that are the actual problem. We don't all look at a garment and think, 'I can definitely wear this over 30 times', we tend to pick up something and think to ourselves 'do I like this?' or 'will I wear this?' rather than, 'how many times will I wear this? If it's more than 30 I shall buy it'. So our consumer habits need to change in order for fast fashion to become something that is beneficial to us all. We need to think about the environmental impacts and what it will be doing to landfill before actually buying all of these garments. However though, having a wider choice of clothes, is something that is definitely better for us all, it allows us to be more individual, but not thinking about how many times you'll wear the item of clothing is the thing that is the problem. I don't think fashion would be as big if it wasn't fast, and items weren't sold as cheap, I think there would be a massive drop in the market and fashion wouldn't be a large industry like it currently is. Fast fashion is beneficial and I think it can be very good for us all if we think about our planet and our consumer habits before buying clothes. There would be a drop in sales for the businesses, but that would mean that they wouldn't have to stock as much clothes, but would mainly focus on the textiles used and whether people would actually buy it.
For us, Daintree denim, fast fashion is very important to us, as we want to be a brand that sells denim pieces that are on trend, but we want to do it in an environmentally friendly way, by upcycling old jeans. We want to give jeans a new life! With patchwork jeans, we would take in all the unwanted jeans that would be put in landfill, but instead we'd cut them up and use most of the denim there to create patchwork, upycled levi's jeans. In that case, it stops jeans from going to landfill (as they're really hard to depose of due to the rivets and buttons) and have jeans that can be upcycled in order to fit in with the current trends that are out there. Jeans won't be made until someone has purchased the trend we are offering for the jeans, so they'll be made and then be shipped straight after someone has clicked 'buy now' and paid for the item. Therefore, that means we won't be making anything until customers have made a payment, which suggests that we won't have any wasted jeans.
[1] https://daily.jstor.org/fast-fashion-fills-our-landfills/ - by Flickr user Joel Kramer, September 27th 2016.
[2] http://www.julietschor.org/the-book/synopsis/ - by Juliet B. Schor - Plenitude: The New Economics of True Wealth
Background research:
-http://www.abc.net.au/news/2017-03-28/the-price-of-fast-fashion-rivers-turn-blue-tonnes-in-landfill/8389156 - 28th March 2017, by ABC news.
Denim plus - Shop presentation mockups
Sign outside the front of the store:
- Name of store
- Symbol in corner so people can associate the fan plant with the brand name.
- Look book photos placed around
- Rustic atmosphere
- Wooden floors, white brick walls...etc
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