three noble fashion retailers in the textile industry

Executive Summary

The paper focuses on the case study of three noble fashion retailers in the textile industry; H&M, Benetton and Zara. These firms have been competing in terms of design, manufacturing, retailing and the supply chain. It seeks to establish the different approaches used by these firms to design, manufacture, retail, and supply their products. The main focus for such reputable brands is to create and improve a result-oriented supply chain management. The first section discusses the differences between the three firms, while the last part will seek to show the most efficient supply chain among the three firms.
H&M uses a much different design from Benetton and Zara, which uses an automated system, which links the designing and manufacturing systems across the globe. Zara’s supply chain system is the most effective among the three firms since it concentrates on the design stage as the most fundamental part of the entire system. Zara presents a model of the design before introducing the product to the market. The main aim of this strategy is to know the consumer reaction to the product and possible modifications required.


Fashion is one of the world’s most influential creative industries. Over the years, the brands have been performing various efforts to enhance their selling capabilities. H&M, Benetton, and Zara have been competing in the global fashion market. Over the years, these firms have built their reputations through extricate designs and have captured significant market shares around the world, owing to their well-designed products and efficient manufacturing, retail, and supply chain systems. The paper analyzes how these firms have been performing in terms of product design, manufacturing process, retail process, and the efficacy of supply chain management. It also seeks to identify the most effective supply chain system among the three firms.

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The Design Stage

The corporations have different methods to their design strategy, though Zara and Benetton show some similarities in their processes. Both firms have abandoned the traditional seasonal production approach due to the increased demand in the garment market. H&M’s design principle relies on fashion, price, and quality, focusing on reasonably affordable and high-quality designs (Mierzejewska, 2017). H&M’s designer is famous and has collaborated with 50 other designers to produce fashionable and reasonably priced outfits.
Meanwhile, Zara’s system includes designers, market specialists, and buyers. The process begins in retail shops, where the market specialists receive customers’ feedback on a prototype (Mo, 2015). Designers concentrate on the market trends and feedback from the consumers. Benetton’s team of 300 designers researches the market and designs according to the new market trends (Filieri, 2015). Benetton uses vertical integration in its supply system, thus gratifying different market segments. The firm is more focused on the differentiation of its products to meet the dynamism in the fashion industry.

Manufacturing Stage

The firms employ different approaches in manufacturing processes. Instead of manufacturing plants, H&M uses subsidiaries in Europe and Asia (Mierzejewska, 2017). The subsidiaries have about 21 production offices working with 750 suppliers which dye the garments depending on orders. Zara has established about 20 Spanish branches that carry out the production processes such as dying and cutting (Mo, 2015). The rest of the operations are under the control of subsidiaries that sew. The firm also has sub-contractors who work in a single shift to ensure flexibility. Benetton has dispersed its fashion production to Asia, Eastern Europe, and North Africa. However, the firm’s central production unit is situated in Italy (Filieri, 2015). The firm employs backward integration strategy to control a share in their top suppliers and ensure specialization in T-shirts production in Spain.
The Distribution Process
The companies employ different distribution process; H&M handles its products from the inside and outside the distribution process. The goods move from the production point to the retail centers through terminal inspection in Hamburg; they store the products as they await the selling process. Zara and Benetton have automated their warehouses, which quickly assembles and stores specific orders from their local and international customers.
The Retail Process
H&M owns all its retail stores, which are about 1,300 square meters wide, thus making their clients more comfortable while shopping. Zara uses a similar approach; however, the stores are smaller — 800 square meters. Both they produce in small batches and never repeat designs; thus, garments are always in demand (Mierzejewska, 2017). Benetton uses both small third-party retailers and large stores to market and supply their products.
The Supply Chain Management Strategy
H&M has begun using the pricing strategy to edge the competition in the fashion industry. It focuses on design, quality, and price thus providing high-quality products at reasonable prices. H&M ensures a low production cost at every stage to make its products affordable to consumers (Bandyopadhyay, 2015). Zara uses vertical integration supply model, which includes customers and the Inditex group in its supply system. This strategy facilitates communication between the customers’ and the marketing department. Benetton has adopted the specialization method to expand and decentralize its production process. For example, it produces T-shirts in Spain and jackets in Eastern Europe, thus ensuring a bulky production at a time.
The Best Supply Chain
Zara has the most effective supply chain management because of its highly well-organized approaches. The manufacturers are close to the operational base and clients thus facilitated the smooth exchange of information between consumers and producers as well between the designers and producers. Also, the firm has a system that incorporates market specialists and designers, thus ensuring the market demand and trends are met adequately (Fredendall & Hill, 2016). The supply chain begins with the customer and ends with the designer; as a result, they produce according to the customers’ taste. Also, the fact that their products never stay in the stores encourages the customers to attend them regularly; it means that Zara sells in large volumes.


Zara should adopt the retail methods used by Benetton to improve its sales volume. This involves the inclusion of third-party retailers in the supply chain. The change would be to suit their approach of taking small quantities into the market. H&M should automate their distribution systems to reduce distribution costs. The firms should also use social media marketing to increase their online presence, which will increase their sales volume.

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