Design individual pieces > Manufacture in small quantities > Logistics
There is not much need to forecast sales if small quantities are being manufactured (low risk), and if stocks ever drop low enough, manufacturing can fill the hole quickly (high turnover). Zara does this with roughly more than 50% of their entire stock during a year.
So how does Zara beat out other fast fashion brands like H&M?
TLDR; no outsourcing times. To manufacture a garment, one needs the design, the textiles and accessories, as well as the labor.
Zara has created the ultimate Trinity of fashion. Their designers, textile manufacturers (under parent company Inditex), and laborers (again under Inditex, in the same building as textile) are all combined at one location. Between the designer's office and the factory is only a 20 minute car ride, from Arteixo to A Coruna in Spain.
This strategy, made with the help of Toyota, is now called "Just-In-Time", and is one implementation of a vertically integrated supply chain strategy. So far, no other company has been able to match this speed, because it requires a tremendous amount of infrastructural investment, backed by solid management to be able to pull off. This is a competitive advantage that is at its best, one that is hard to imitate.