Product innovation counts for little unless the products reach the customer. This means the innovation must be distributed quickly and in a way that fulfils customer needs. The most respected...

Product innovation counts for little unless the products reach the customer. This means the innovation must be distributed quickly and in a way that fulfils customer needs. The most respected companies are not the cheapest or the most innovative but those that actually deliver the products 3 literally. Take, for example, Dell the PC manufacturer. Its PCs are little different from those of IBM and Hewlett-Packard. Yet Dell’s business model has revolutionised the industry and made Dell the PC leader. In the fashion sector, Zara, the Spanish clothes retailer, has grown to be an international phenomenon. Zara sources much of its production locally. While that may cost more on a unit basis, it gives Zara a more responsive supply chain, enabling it to bring out new lines as fashions change. Good supply chain management can translate into lower prices. For example, Payless Shoes, the US footwear retailer which has 5000 stores and maintains an average of 800 different styles and colours. Payless can get a pair of shoes all the way from China to the US and sell it for just $15.