Structured Process Analysis

Structured processes in business have well defined inputs and outputs, they follow a predefined sequence of activities. The process of returning products will be examined for this analysis. Zara has strict policies and protocols for accepting returnable products both at their retail stores and via their online sales channel. The decision to pursue omnichannel revenue via online and offline locations has its drawbacks at times but returns should not be one of them. The logistics involved in the acceptance of online sales returns should not be understated and Zara has been at the forefront in providing a seamless shopping experience. In 2019, the losses attributed to returns of online purchase cost the US retail industry approximately $41 billion (Jin, et al, 2021).  The BORO (buy-online-return-offline) or BORS (buy-online-return-in-store) decision has become the standard for online retailers who have physical locations, both for convenience to their customers and savings in regard to return shipping costs. You don’t even require a physical store location in all areas with the growth of UPS Stores, FedEx Copy Centers, and other third party drop off locations. 
    To start Zara’s process, if an item appears to have been worn or is damaged then the return would be denied. An actual receipt is always required as an employee can’t search for past purchases on your credit card. The customer would have to call customer support who would be able to search and provide a copy of the receipt to them. If the product is found to have been purchased from Zara and in acceptable condition then the return process will commence. As we will explain further on in this report, various software programs tied into Inditex’s ERP are utilized in daily operations, but returns are processed at the point of sale terminal using “program.” This tie-in allows for instantaneous acknowledgment of whether the item should be placed on the sales floor or returned to the distribution center. The only determining factor to whether the item should be placed on the sales floor is whether it is still actively being sold. Zara’s return window policy is to allow the customer 30-days so there is a chance the item might be out of season depending on when it was purchased. Upon return to the distribution center, they will determine if the item would replenish their inventory or be packaged for a return to the distributor, which for Zara is itself and requires shipment back to Spain. The vertical integration of Zara allows it to realize various cost savings and gains in efficiencies that other retailers simply don't have. 

 

BPMN Diagram of Structured Process

Technology used in assisting store personnel in completing their tasks. Some examples of them include: 

Zara has two devices that all stores use to check inventory and also track sales in real time. The main device is named Blue Bird and is mostly used in the stock room. This device has an RFID reader that allows employees to know the exact amount of inventory in the stockroom and sales floor and their categories, shoes, clothes, fragrances, and accessories. The built-in app that helps this operation come to light is powered by an in-house ERP system named INDITEX. The name of the app on the “Blue bird” is called 25R. 25R is a software that helps keep count of inventory both on the floor and in the stock room. The iPod Touch is what is used mostly on the floor to place orders for customers and also check inventory in the store. Furthermore, the iPod Touch also has a built-in app linked to INDITEX, that also keeps track record of sales in real time and also shows records for other stores in the region. For example, ZARA Menlo Park (Edison, NJ) could see the amount of money ZARA Freehold (Freehold, NJ) is making every minute/ hour and vice versa. That is also called the twin store on the app.