Reference no: EM131096459
Zara, a clothing manufacturer and retailer based in Spain, is unique for providing just-in-time low-cost fashion. The company designs new collections in only four or five weeks, quickly reacting to trends, such as what is stylish on a music video, in magazines, at shows, and in fashionable cafes, restaurants, and bars. A collection can be manufactured in a week, at its modern facility in northwestern Spain or at 400 cooperatives run by local seamstresses. This compares to the typical competitor's six-month design phase and three-month production period.
A new collection is test-marketed in a selection of stores around the world, and sales are monitored carefully using computer technology. If the sales are brisk, more items are produced and distributed. Deliveries are made twice a week, and clothes rarely remain on the shelf for more than a week. This just-in-time delivery system means that inventory costs are low.
Models are changed, updated, and mixed and matched frequently. This attracts consumers on a regular basis because they can buy something different each time. They are also under pressure to buy because they are unlikely to find the same item at a later date.
(Updated July 1, 2001)
Source Carlta Vitzthum, "Just-in-Time Fashion," The Wall Street Journal, May 18, 2001.
Questions:
Explain what form of non-price competition the firm uses to gain an edge on its rivals.
What other clothing chains serve the market of teenagers and young adults? How do they compete? Price? Something else?
|
Regulation shields them from the pressures of competition
: Which of the following is the correct name for the idea that certain firms prefer government regulation because regulation shields them from the pressures of competition and, in effect, guarantees them a regulated profit.
|
|
When confronted with natural monopoly that restricts output
: When confronted with a natural monopoly that restricts output and charges monopoly prices, the two methods that governments have for promoting better outcomes are:
|
|
Negative income elasticity of demand coefficient indicates
: A negative income elasticity of demand coefficient indicates that:
|
|
Function of the size of the social security system
: Jessica will live for two periods. She is only able to work in the first period, when she earns $100. The interest rate between the first and second period is r, meaning that if she saves X in the first period she can consume X(1+r) in the second. As..
|
|
Non-price competition firm uses to gain edge on its rivals
: Zara, a clothing manufacturer and retailer based in Spain, is unique for providing just-in-time low-cost fashion. The company designs new collections in only four or five weeks, quickly reacting to trends, such as what is stylish on a music video, in..
|
|
Level of investment depends on level of domestic savings
: In the solow model, the level of investment depends on the level of domestic savings. If the level of domestic savings is too low to allow the economy grow to the Golden Rule level without taxation, what other sources could this economy try to tap in..
|
|
Output and consumption at the golden rule steady state
: In the Solow model with taxation, the government’s budget is in balance, i.e., its expenditures are equal to the tax revenues collected (Lty). Suppose that the government runs persistent budget deficits financed by additional direct and indirect taxa..
|
|
Calculate the price elasticities of demand in each market
: Greener Grass Company (GGC) competes with its main rival, Better Lawns and Gardens (BLG), in the supply and installation of in-ground lawn watering systems in the wealthy western suburbs of a major east-coast city. Last year, GGC’s price for the typi..
|