Four Reasons For Primark’s Success

Clothes Keep Up With Latest Fashion & Make Their Own (Qualitative)

Primark has gained the title of “King of no-frills fashion” from the way it manages to keep
the prices incredibly cheap, whilst also keeping up with the latest fashions. Primark has also
made it into fashion magazine Vogue which is generally for the very high end fashion
designers. As well as this, fashion designers in Milan have been heard to talk about new
designs that Primark have out. Coupled with this they can get these designs fast. They take
inspiration from the catwalk and the red carpet and statistics show that concept designs can
actually be in shops in a mere six weeks irrespective of whether it is a fancy or simple
design. It is clothing items such as the ‘military jacket’ in 2005, which are so cheap that
people flock to buy them in such high quantities, that they become iconic. Primark boosts
its sales by having ranges and brands within Primark stores that make it easier for each
Four Reasons For Primark’s Success
individual customer to shop. They will know exactly where to go to, to find their items,
which makes the shopping experience much easier for the customer, making them more
likely to come back to the store.

Clothes Are Cheap (Quantitative)

The driving force behind Primark’s success is the unbelievable cheap prices they maintain.
Their regular prices of clothes are far cheaper than other high street retailers’ sales prices.
This naturally attracts a huge market of people who want equally fashionable clothes at very
cheap prices. Prices of jeans ranged from £8 and £4 for men’s trousers as well as £15
jackets. Although Primark maintain the fact that they know nothing of sweatshops in
Bangladesh paying 3p per hour, they are the only logical reasons as to why Primark can
maintain such low prices. These prices come at a cost to the quality of the product;
however Primark has built up such a reputation that, even if the clothes only last the
customer for a year it would still be worth it. For example if someone bought the £4 men’s
khaki trousers, and wore them for a year, it would be £4 well spent over the course of 12
months. Gap’s equivalent product ranges from £30 to £40. These would probably last
much longer but the fashion industry changes very often and thus consumers wish to keep
up rather than wear ‘old season’s’ fashion. Primark also manages to keep its prices so cheap
by sourcing cheap supply, by buying in bulk loads whilst only producing popular sizes.
Furthermore these sizes are aimed at teenagers who do not have much disposable income,
and therefore attract a high percentage of them immediately to Primark.

Ambitious Expansion (Quantitative)

Primark’s clothes are very cheap; however their image and stores are not. Being owned by
‘Associated British Foods’, Primark has the capital to spend on furnishing its stores to a high
standard, which its competitors simply do not have. Coupled with the furnishings, Primark
stores are located in prime locations such as Lakeside, the relatively recent addition at
Oxford Street or their largest store on Church Street, Liverpool. In 2005 annual profits were
up 30% and sales up 17% to more than £1 billion. The coming Summer Primark opened two
stores in Spain with the intention to directly challenge Zara and Mango, two popular native
brands. Through 2009 Associated British Foods sales rose 16% in their fashion stores, in the
last 16 weeks of the year. This was due to the 6 new stores that were opened. One of these
was the Oxford Street Primark which continually increases profit for the company. This
aggressive take on the market has enabled Primark not only to appeal to the poorer
consumer, but all types of consumers spend in Primark, simply because it is so cheap.
Coupled with this aggressive approach to the market, Primark have bought out main
competitors such as ‘Littlewoods’ and ‘Allders’. As this happened, it became clear that
Primark began its strategy to become the dominant presence on the high street.

Recession (Qualitative)
Four Reasons For Primark’s Success
Most businesses and retailers begin to see sales falling in the period of recession. This is
because people have lost money, have less to spend and thus general consumer confidence
is very low. However with a necessity such as clothing, consumers will have to continue to
buy them, so many immediately flock to Primark due to the sheer cheapness. 2005 was a
major success for Primark because consumers had rising interest rates, rising utility costs
and a flattening housing market. With fashion being such a core foundation in the lives of
consumers, in particular women, “no-frill fashion” shops provide a perfect service, with
Primark leading over its competitors. In mid 2009 Primark reported a profits increase of
10%. A major contributor to this figure was the opening of the Oxford Street flagship store
which has reported operating profits of £122 million in 6 months of opening.

Most Important Factor For Primark’s Success

The most important factor for Primark’s success is the fact that the clothes are simply so
cheap. This is the main reason why many people shop at Primark. They know that if the
clothes get ruined or ripped after a year, they have not lost much money because they did
not pay much for it. However coupled with the price is the factor of the locations of the
stores. The parent company Associated British Foods has capital available to secure ideal
locations for Primark to open. For example, Primark at Lakeside is an entrance meaning
many people that go into or come out of Lakeside could have to go through Primark.
Coupled with incredibly low prices that remain as low as £1, it is easy for consumers to be
enticed. However along with the low price is the risk taking involved and the aggressive
expansion that has taken place. With over 120 stores across the UK, Primark is making sure
that it is accessible to the majority of the population. Not only this, but Primark has
expanded into Spain and other European countries and greatly succeeded. Two stores were
opened in Spain, the capital of fashion. This has obviously been a successful expansion by
the current eleven stores based in Spain.