• Primark is an Irish clothing retailer, operating
in Austria, Belgium, Germany, Ireland (38 stores
branded as Penneys), Portugal, Spain, the
Netherlands and the United Kingdom. The
company's main headquarters are in Dublin;
they are a subsidiary of British food processing
company ABF. Primark first opened in June 1969
in Mary Street (Dublin).
• Established over thirty years ago, Primark
started out in Ireland but soon established
branches in the UK, creating a historical legacy
that explains why it retains two head offices, one
in Dublin, Ireland (where the company is known
as Penneys), and one in Reading, England. The
clothes retailer has been particularly successful
in the last decade, enjoying rapid expansion
• Primark, source clothes from countries like
China, Bangladesh, India and Vietnam where
materials and labor costs are lower. Primark
works with a variety of manufacturers from
around the world to provide consumers with
what they want.
Primark- At a glance
Number of locations
: Dublin, Ireland
: Arthur Ryan, Chairman;
Paul Marchant, Chief Executive
John Lyttle, Chief Operating Officer
Ben Mansfield, Sales Director
Breege O'Donoghue, HR, PR &
Aidan Shields, Chief Financial Officer
: Women swear, menswear, children
swear, footwear, accessories, lingerie
and home ware
: £3,503m (Financial Year 2011/2012)
: Associated British Foods
As with Penney's, Primark is positioned in the Lower Middle/Value
sector of the general merchandising market, with its main focus on
Family Safe fashion. Primark targets young, fashion-conscious under
35s, providing fashion basics at value for money prices.
A fast-growing brand
Part of Associated British Foods (ABF)
Growth stems from meeting customer needs
Offers high fashion at value-for-money prices
Moving into new markets
Products sourced from over 600 suppliers in 16 countries
Europe, Asia, Middle and Far East
Primark has responsibility to source ethically
Today, Primark has 253 outlets, including 159 in the UK, 38 in Ireland,
and over 40 across Spain, Germany, Belgium and Holland. The number
is rising all the time as the company continues to grow.
History of Primark
The Primark story has been one of continuing success founded on a
unique combination of fast fashion and lean operations.
•1969 : The first Penney's store opened in Mary Street, Dublin
•1971 : The first large store outside Dublin was opened in Cork and 11
more stores open in Ireland and one in Northern Ireland
•1973 : The number of stores had reached 18 in Ireland and Primark
began trading in Great Britain with four out-of-town stores.
•1984 : The first multiple acquisition took place with the purchase in
Ireland of five Woolworth stores
•1995 : Development of the UK business with the addition of 16 stores
•2001-2005 : continued UK and Ireland expansion
•2006 : Primark opened its first store in Spain – in Plenilunio (Madrid)
•2008 -2010: Expansion into Netherlands, Portugal, Germany and
•2011 : Primark further expanded with store openings in the UK,
Spain, Netherlands, Portugal, and Germany.
Facts about Primark
• Primark, the clothing retailer, has recently experienced rapid
growth and is in the middle of a major strategic change from
‘pile it high and sell it cheap’ discount retailer to mid-market
brand with celebrity status.
• It has gained market share at the expense of established
clothing retailers such as Next and Marks and Spencer (M&S).
It has also battled effectively against supermarkets, such as
Asda and Tesco, which offer low-cost clothing lines.
• Primark’s success has been most apparent in the growing UK
womens wear sector which, in 2006, had total sales of £18bn.
• Originally, Primark tended to locate in cheap, out-of-town
sites in areas of low income. These locations kept costs down
and meant that the company was close to its target market
• Primark decided to take its discount approach into the
mainstream market. It has begun targeting middle income
customers and competing more directly with M&S,
Debenhams and Next.
• Primark has achieved this in a number of ways including
moving into town centre, high street sites in larger, more
affluent locations. It no longer targets exclusively the low
income customer, and now says that its primary target market
is “young, fashion conscious fewer than 35s” who want
fashionable clothing at competitive prices.
• Primark has been featured in fashion magazine “Vogue”, and
celebrities have been seen wearing Primark clothing.
• As Primark’s strategic direction changes, and the company
moves into the mid-market sector, it has realized that low
prices alone will not be enough for success against established
companies. Fast product design and innovation, effective
brand differentiation, excellent customer service and a
positive shopping experience are all essential. The company’s
organizational culture will have to change if it is to change
from discount to mainstream retailer.
Primark: Iconic fashion
Primark's success is not simply down to supplying a fashion fix.
Primark thrives because of its speed at turning out designs
inspired by the catwalk and red carpet. It takes on average just six
weeks for an item to go from concept stage into the shops,
irrespective of whether it's a Kate Moss style waist coat or a
Sienna Miller hobo style skirt.
“Great sales does not make a brand
fashionable” critics say
"If Primark produces an iconic
piece like the military jacket, they
can do it as such low prices that
everybody just zooms in on it,"
says Ms Hinton.
Mission and Vision of Primark
"The mission statement of the Primark to supply quality
clothing at prices perceived to offer real value."
“The vision statement of Primark providing quality
products and services to their customer through price
“A low cost strategy is not a
cheap strategy for a
company to pursue”
specifically for the company
and as such Primark has its
own brand names. Within
both menswear and ladies
wear there is one main brand
name that supplies most of the
fashion labels, which are
added to by other suppliers.
Ladies wear Brands
Ocean Club — beachwear and
Atmosphere — Ladies fashion
& formal wear
Men's wear Lines
Denim Co. — Ladies denim
Cedar wood State — Mens
Limited Edition — Ladies
fashion (available only from
Butler & Webb — Mens formal
Authentic Apparel — ladies
Backswing — Sportswear
Cedar wood State Active (CS
Active) — Men's sportswear
Secret Possessions — lingerie
Denim Co. — Men's denim
Primark Essentials —
No Secret - Lingerie
underwear & nightwear
Primark Essentials —
Authentic Apparel — Men's
Love 2 Lounge — slippers, hot
water bottles etc.
Children's wear Lines
Early Days — baby wear (newborn-23 months)
Little rebel — boys baby wear (9–23 months)
Young dimension — girls baby wear (9–23 months)
Young dimension — young girls wear (2–7 years)
Girl 2 Girl — young girls wear (2–7 years)
YD — older girls wear (7–16 years)
Rebel — boys wear (2–7 years 7–16 years)
Denim Co. — Children's denim
Primark Essentials — underwear
Opia — Accessories
Opia Girls — Accessories for girls
Primark Beauty — Cosmetics
Primark Home — bedding, cushions, curtains, towels, kitchen
and home accessories
Primark: A Brief Overview Of The Business
Primark is a brilliant and unique
statement to enrich the life of
everyone with fashionable clothing
regardless of social status.
It emerged as major force in the British
retail industry, contributing through
its low price value and great quality
fashion products for everyone in
society as a whole and leaves
environmental and ethical behavior of
Primark does not rip off its customers
and presents excellent example of it
motto which states “look good, pay
less” Primark, (2010).
• According to Associated British Foods Plc (2009) it is a
diversified international group. It has over 96,000
employees in 44 countries with sales of £8.2 billion
approximate every year.
• This global business group has sales and manufacturing
operations all over the world. It has operation in America,
Europe, Asia, China and Africa,. Associated British Foods
Plc's business activities can be divided into grocery,
agriculture with sugar, ingredients and retail.
• The retail segment comprised of a major value fashion
retail group. This group is trading on the high street as
Penneys in Ireland, Primark in the UK, and Primark
Tiendas in Spain.
• It is operating 190 stores with 5.7 million square feet of
selling space on the high streets of the UK, Ireland and
• Recent research proved that in UK, Primark is now the second
largest clothing retailer by volume. In the important value sector it is
also the largest retailer.
• Most of their clothes are bought from same factories as other fashion
retailers and people producing them are paid exactly the same
whatever label and whatever price in shop.
• Company's success is based on sourcing supply cheaply, they buy
directly from factories without involving any agents, making clothes
with simple designs and fabrics, only making them in the most
popular sizes, buying stock in huge bulks and varieties and targeting
young, fashion-conscious buyers under 35's, offering them high
quality, fashion basics at value for money prices.
• They are able to offer such good value and good quality because of
low mark-ups and big volumes.
• Their overhead costs are extremely low as they do not run expensive
advertising campaigns; instead they have wonderful strategic
marketing approach that stands them out.
Stores of Primark
Number of Stores Trading at 22nd November 2012
Ireland – 38
Portugal, Germany Belgium, Austria-2
Spain – 33
UK – 159
Netherlands – 3
Portugal – 6
Germany – 8
Belgium – 1
Austria – 2
Primark business model
•Business model based on
High sales volume
Lower retail margins
•Value for money stems from
Economies of scale - buying volume
Sourcing products efficiently
• Using simpler designs or local fabrics
• Focusing on most popular sizes
• Using off-peak factory time for
Not spending heavily on advertising
Primark and business principles
Primark shares values with parent ABF
Shape relationships with all stakeholders
Affects dealings through supply chain
Respect for human rights
Setting appropriate conditions of employment in
• Over 700,000 workers in three continents
• Around 95% of Primark suppliers also supply
other high street retailers
Company's success is based on
sourcing supply cheaply,
they buy directly from factories without involving any agents,
making clothes with simple designs and fabrics,
only making them in the most popular sizes,
buying stock in huge bulks and varieties and targeting young,
fashion-conscious buyers under 35's, offering them high
fashion basics at value for money prices.
Their overhead costs are extremely low as they do not run
expensive advertising campaigns; instead they have wonderful
strategic marketing approach that stands them out.
Primark is able to offer value
and low prices because its
business model is based on
high sales volumes and lower
retail margins with minimal
The company keeps costs down
by buying large quantities of
economies of scale resulting
from buying in bulk. In
addition, retail prices are kept
low through lean production
The Market Segment
The market segment of Primark is
teenagers and young adult
(working group). In the competitive
marketplace, the market segment has
been an important factor to have a
clear definition in the supply chain
management and sustain their sales
even in the midst of industry crisis.
The market segment targeted by
Primark is the fashion conscious
under-35s with the slogan "Look
good pay less”
Primark’s new strategy is built on a number of key elements:
• continued rapid growth through careful selection of
locations in prime sites in the right towns
• improved store layouts that are more attractive and shopper
• buying the latest fashion goods at competitive prices from
suppliers all over the world
• an organizational culture that places a much greater
emphasis on good customer service
• attracting high quality staff with a range of retailing skills
• achieving economies of scale as volumes of supplies
• Publicity featuring celebrities wearing Primark clothing.
• Primark’s purchase of a number of high street stores from
two large retailers, who recently went out of business
acquiring the prime sites necessary for the move to the midmarket. The company than works with the local community
to promote its shops as a good place to both work and shop.
• Primark builds links with local colleges, Job Centers and
community groups to recruit the best people.
• employees undergo a three-week induction and training
program designed to communicate its organizational culture
and to build team spirit.
• The organizational culture attempts to create dynamic
people who can thrive in a fast moving fashion industry and
who enjoy putting the customer first.
• Attracting the right people to work for the company is
A successful marketing mix contributes to good marketing of
a product; hence there must be a brand strategy in place.
American Marketing Association (AMA) defines a brand as a
"name, term, sign, symbol or design, or a combination of them
intended to identify goods and services of one seller or group of
sellers and to differentiate them from those of other sellers”.
Primark has an extensive brand portfolio, Primark's branding
Delivers message clearly
Confirms your credibility
Connects your target prospects emotionally
Concretes User Loyalty
Gaining a specific number of new clients in next year
Positioning company as an industry leader in next 12
Strategic Marketing Management of Primark
Strategic marketing management entails the process of
formulation, implementation and estimation of marketing
strategy by an organization. Simply strategic marketing
management is about realizing marketing form the strategic
perspective of creating customers. Based on the strategic
points, at the level of marketing and at the level of the
instruments (the 4ps: price, place, product and promotion)
are created. The basic principles of Primark include
respecting human rights and setting a guideline for
appropriate conditions of employment
suppliers, employees and vice versa. The strategic
marketing of Primark has enabled them to capture
confidence of customers in the brand that helps reducing
the risk of business.
Cost -The management of Primark has
made an impression in every
costumer's in such a way that it is
considered to be low cost stores. The
cost factor helped Primark a great deal
in maximization of their revenue and
profits. Primark provides a whole
range of clothing in a very affordable
price which doesn't hamper pockets of
a common man.
Shopping Easy - Along with the cost
factor, Primark has given utmost
importance to make the shopping of
the customer easy and cosy. The
interiors of their stores have been
designed in such a way that it gives
utmost comfort to the customers. This
sitting, friendly and helpful sales
person, descriptive displays etc.
Focus on Customer Satisfaction - the
ultimate aim of Primark is customer
satisfaction. This is the reason why
along with low costs, Primark provides
comfort zone to their customers.
Primark considers the customer to be
the basic reason of their business is
customer itself and customer are
considered to be the “king”. Each and
every decision, policy and procedure
has been designed by management
keeping in mind the importance of
customer and their satisfaction.
Job creation - Primark created a lot of
jobs in a short span of time. Jobs were
designed in such a way the total work
is divided into small segment, such
as, one bigger work is divided into
smaller segments to make it
simplification increases productivity
and reduces wastage to a great extent.
Supply Chain of Primark
• The idea of supply chain management, has been an important
factor in the industry especially on the firms that are engaged in
the international market and is an ideal way to appropriately
deliver the customer’s needs in the most desirable way.
• Stepwise action makes Primark a productive sector. It is an
exciting growing brand that provides consumers with value for
money in fashion items.
• The company has an effective supply chain that combines
Bangladesh, India, China and Turkey and some parts of Europe.
• Like other business Primark’s main objective is to be a profitable
and sustainable but in doing that it is always trying to satisfy
customers keep themselves responsible to the customers.
Efficient Supply Chain, Rapid Turnover
• Like many of their competitors, Primark’s strategy is
heavily rooted in using private labels.
• However, unlike Zara’s focus on style, or H&M’s general
affordability, Primark’s niche is its rock-bottom prices.
• Costs are kept low by making cheap garments from manmade materials, using cheap production processes.
• There is also limited reordering of products, as they
operate on a “when it’s gone, it’s gone” basis.
• This results in frequent visits from customers, as the
average store turnover is six weeks
Limited Operating Costs
• As Primark’s main selling point is price, the company must forgo
expensive advertising almost completely, instead relying on “big
bags and big savings” to convey their message.
• They also place their cheapest items at the front of the
store, attracting passing trade and word of mouth.
• Primark stores tend to be in shopping malls outside of
downtown, further reducing costs through lower rents.
• Finally, staff service is focused primarily on managing checkout
lines and managing showroom inventory. Quality of service may
suffer, but the low costs are enough to satisfy a certain breed of
• Since 2001, when it built a 100,000-square-foot store in
Manchester, Primark has focused primarily on large stores to
encourage volume shopping.
• Floor space has in the past decade, resulting in tripled higher sales
• Primark has hired interior designers to outfit them with innovative
floor layouts and color plans to facilitate efficient shopping.
• Market Research World, 2011 revealed that value fashion
sector sees worst decline for first time in over 16 years much to gain of higher-priced retailers, reveals data by TNS
World panel Fashion.
• While fashion discounters such as Primark, Tesco, George
and Matalan saw a phenomenal sales increase of nearly 30%
last summer, growth has now ground to a hold with sales
falling by 1% over last six months.
• In contrast, sales of most expensive clothing are up by
4%, as shoppers head to generally more expensive retailers
such as multiples and mail order retailers.
• Clothing industry has been globalised.
• Strategies followed by clothing firms, to survive in a context
of strong pressure from retailers and from competition from
low-wage countries, are a combination of two trends.
• First trend is relocation of production to low-wage
countries; second one is the development of six added-value
package, innovation, branding and retail.
Ambitious expansion and sourcing strategy
The buzz around Primark
has, inevitably, made it a
favourite among financiers in
the City of London. The latest
company results, released in
November, show annual profits
up 30% and sales up 17% to
more than £1b. This Spring will
also see Primark challenging
the fashion chains Zara and
Mango on their own turf when
it opens two shops in Spain.
Can Primark continue to grow its
• Primark is expanding more rapidly than any other British
retailer. The company is planning to expand to
Portugal, Germany and the Netherlands in 2009
• British shoppers can expect more new stores in the
UK, where Primark already operates 4.8 million sq ft of
retail space across 140 stores, employing 25,000 people. Its
flagship Oxford Street store sold more than one million
garments in its first 10 days of trading.
• Primark's parent company, Associated British Foods, which
Twinings, Ovaltine, Ryvita, Jordans and Patak, as well as
multi-billion-pound sugar and agriculture interests, regards
Primark as the jewel in its crown. Boosted by Primark's
profits, the company last year posted revenues of £8.2bn.
Primark's marketing strategy during recession
• In recession normally people are trying to cut down extra cost
from their daily life
businesses, unemployment problem and devaluation of pound
sterling against dollar and euro. So, normally consumers are
going to be more dependable on the value products which will
cost less from that of luxurious brand products.
• Primark's success is surprising because it came at a time of
retail gloom. In a downtrodden economic climate marketing
strategy is different than that of normal economic situation.
• Primark is doing remarkably well in this downtrodden
economic environment. In a word, Primark's strategy is
working better than its rivals and seems to be very fit now.
Company's success is based on sourcing supply
cheaply, they buy directly from factories without involving
any agents, making clothes with simple designs and
fabrics, only making them in the most popular sizes, buying
stock in huge bulks and varieties and targeting
young, fashion-conscious buyers under 35's, offering them
high quality, fashion basics at value for money prices.
• Their overhead costs are extremely low as they do not run
expensive advertising campaigns; instead they have
wonderful strategic marketing approach that stands them
• The company has recently faced criticism from pressure
groups who claim that it exploits cheap labour in low-wage
economies, with no regard for workers’ conditions, so that
it can drive down costs.
Impact of Marketing Strategies on Financial
• They have been operating for several years and they are
currently buying out Littlewoods stores, several of the best
of which will be turned into Primark's and rest sold for a tidy
sum to other retailers.
• Primark has aggressive expansion plans in UK and on the
Continent. It plans to open in Holland and Germany next
year, as well as launching in Portugal. Primark flagship takes
an average of more than £2.5 million in sales a week. Rival
Marks & Spencer has two stores on Oxford Street, while Next
• Financial statistics of Primark present an excellent report of
figures revealing a constant increase in revenue and
operating profit over last three years from 2008-2011
• Year 2010 was exceptional for Primark as its revenue
increased by 18% with like-for-like sales growth of 6% and
benefit of continued investment in new stores.
• In comparison with other high street retailers profit was
35% ahead and operating margin improved substantially
from 10.9% to 12.5%.
• This improvement was mainly due to sterling's relative
strength against US dollar in first half which benefited cost
of goods sourced in dollars and sold in second half.
• In financial year of 2011, due to higher cotton prices and
freight costs and increases in VAT, already implemented in
Spain and in UK from January 2011, it is expected that
growth will be eroded.
• Primark can still continue to lead market by maintaining
price leadership strategy and by target marketing strategy
in long run.
Strategic Marketing Environment Analysis
There are three different analytical tools used to assess
marketing environment of an organization;
1. Porter's Five Forces Analysis,
2. SWOT Analysis and
3. PESTLE Analysis.
Porter's Five Forces Analysis
• Strategic position of a company depends upon the extent to
which what it offers is unique and cannot be replaced by
something else. Primark has strong brand portfolio which
is its uniqueness.
• As for some of products, like Primark cheap clothing there
are alternatives. But there is no substitute for low price of
• Buyers/customers have greatest impact on Primark's
strategies as its vision and strategies are customer focused.
• Primark is facing big challenge from supplier as it has good
and long term relationships with its suppliers build on trust
but recently three of its main suppliers are found involved
in child labour and Primark has to cut-off ties with them
immediately which is definitely a big blow for Primark.
• Primark pays its supplier competitive price for their
products to retain them. Primark maintains substitute
inputs, and high volume of supplier to avoid extra costs.
PESTLE Analysis challenging Primark's position in
• Strategic marketing analysis of Primark, using different
analysis tools reveal that Primark is expanding globally
• Primark has adopted an approach of “Think globally, Act
locally” as stated by Armstrong, (2006).
• They are expanding globally but cater needs of local
market and fashion trends in local culture.
• Primark supports UK's global role by showcasing the best
of British fashion to a global customers as well as it reflects
how it builds social cohesion and business ethics between
customers and its suppliers.
1.It has an organized business
2. It offers quality clothes
3. Provides clothing for all
ages and sexes.
1. poor working conditions and
disvaluing workers rights
2. The company could have
1. Expanding ventures.
1.The customer in terms of
2. High quality products and
fashion and uniqueness.
2.They do not have any
3. Provide high quality clothes
advertising whilst their
to fashion conscious
• Primark was at the centre of a storm over allegations that illegal
immigrants paid just over half the minimum wage had been
employed to make fashionable knitwear for one of the firm's
• An investigation by the Observer and the BBC revealed that
Manchester-based garment firm TNS Knitwear which supplies
20,000 garments to the firm every week. may have breached key
employment and immigration laws.
• The workers were allegedly being paid £3 an hour - just over half
the minimum wage of £5.73 - for 12-hour days, seven days a
• Employees at both TNS and Fashion Waves were caught on film
admitting their illegal status in the UK
• Working conditions inside both TNS and Fashion Waves were
also exposed as cramped and cold, in breach of health and safety
• Primark faced a major blow to its reputation on 24 June, 2008 after
being exposed by and undercover report by BBC exposing it using
• Afterwards, Primark's marketing strategy mainly focused to
promote itself as ethical organization with a clear and strict code of
conduct to which all suppliers must adhere and which forms part of
the terms of their contract.
• Primark supports nearly two million people through its supply
contracts worth £700 million and is dedicated to improve their
standard of living and quality of life. For this, Primark has
established ‘Primark Better Lives Foundation' (Primark Ethical
Trading, 2011 a).
• In response to the allegations of use of child labour by its
suppliers, identified by Panorama (BBC program) Primark stopped
buying from three factories in southern India for breaking its Code
• It also took other major initiatives and is now active member of ETI
that announce it ‘Achiever' in year 2009-2010 independent audit
Primark on the rack included footage said to
show three boys in a Bangalore workshop
testing stitching in the shop's clothes
Shamed BBC could lose prestigious TV award over ‘faked footage
of child labor’ in Primark Panorama expose
• The BBC could be forced to hand back a prestigious award it won
for the controversial Primark Panorama expose, after footage in the
show of child labor in India was revealed to be fake.
• The corporation won the Current Affairs Home Prize at the Royal
Television Society awards for its show Primark: On The Rack, which
was broadcast in June 2008.
• However the report said: ‘Having carefully scrutinized all of the
relevant evidence, the committee concluded that, on the balance of
probabilities, it was more likely than not that the Bangalore footage
was not authentic.’
• The footage might not be genuine in the 45-second clip. This
included the size of needles used, which it was claimed would have
been ‘inappropriate’ for ‘delicate’ work they were doing.
• The BBC will make an on-screen apology to Primark for the footage
that was likely faked
• The footage might not be genuine in the 45-second clip. This
included the size of needles used, which it was claimed would
have been ‘inappropriate’ for ‘delicate’ work they were doing
• The BBC Trust also found it odd that in the Bangalore scene
there appeared to be no other garments visible in shot – which
would be unusual if it was a ‘quality control process’.
• It added that the way it had been filmed – with a tight focus on
the boys and less on their surrounding environment – added to
concerns. There were also said to be ‘inconsistencies’ in the
evidence such as the email trail.
• In 2007 Blue Peter, Comic Relief and Children in Need were
found guilty of faking competition winners. And in 2009 a
Sun, Sea and Bargain Spotting cameraman posed as a customer.
Primark is a subsidiary company of Associated British Foods
(ABF). As part of ABF, the company shares important values.
These values provide an ethical dimension to Primark’s
activities. Being ethical means doing the right thing. For
example, ethical companies provide fair working conditions for
their employees, and build fair relationships with suppliers.
For Primark, acting ethically means,
taking care of its people
being a good neighbour
respecting human rights
engaging with its stakeholders.
• On Primark's website, www.ethicalprimark.com, the
code of conduct reiterates the conglomerate's stance that
wages and benefits paid to suppliers to their company for a
standard working week must meet national legal standards
or industry benchmark standards, whichever is higher.
• The same website states that working hours must comply
standards, whichever affords greater protection.
• The firm also claims to adhere to the ETI code of conduct.
Primark’s Code of Conduct
The code states that within its supply chain:
Employment is freely chosen
Freedom of association and the right to collective bargaining
Working conditions are safe and hygienic
Environmental requirements - Primark shares its
commitment with suppliers
Child labor shall not be used
Living wages are paid
Working hours are not excessive
No discrimination is practiced
Regular employment is provided
No harsh or inhumane treatment is allowed
Legal requirements - Primark is committed to compliance of
all countries’ laws.
Primark & CSR(Corporate Social Responsibility)
What is CSR?
Corporate social responsibility represents the responsibility
that a business has towards all its stakeholders, not just to
owners or shareholders, to deal with their needs fairly.
Primark has initiated a programmed of activities which
supports its corporate social responsibility (CSR) stance and
ensures that its trading meets the company’s values and
ethical standards. Underpinning its programmed of activities
is Primark’s Code of Conduct which ensures that all workers
making its products are treated decently, paid a fair wage and
work in good working conditions.
Why Primark embraces CSR
As an international business with a global supply chain and a
growing retail base, Primark believes that business has a
responsibility to act and trade ethically and that, by doing
so, it can be a force for good. Its business directly contributes
to the employment of more than 700,000 workers across
three continents. Ensuring that their rights are respected is
key to its continued growth.
Primark does not own the companies or factories that
produce its goods, but it does have a responsibility to the
workers in those factories, to its customers and
shareholders, to ensure that its products are made in good
working conditions. The HER-project in Bangladesh is an
example of how Primark is actively seeking to make positive
changes in the lives of its supplier workforces.
The programmers aims not only to improve the health of female
workers through training and education, but also to give them the
tools to help them take charge of their personal and working lives.
The HER-project is simple but
• A small number of female staff in a
factory (around 10%) is selected to
become health education trainers
called ‘peer group educators’.
• The local health service provider
educators, who are then responsible
for training the other women based
in the workplace, passing on the
disseminate what they have learned.
Primark's success continues as bargain High Street giant
launches 'posh' flagship store in Oxford Street
• The four-storey unit, which is near Tottenham Court Road, has a
capacity for almost 2,500 shoppers.
• At 82,000 sq ft, it is significantly bigger than Primark’s other Oxford
Street store, which opened in 2007 and covers 70,000 sq ft.
• The flagship store has 1,443 employees, 111 cash desks and 92 fitting
rooms and is the fifth largest Primark in the UK and the seventh largest
in the company.
• Primark, which has 242 stores across Europe, saw revenues rise by
17% over its current financial year.
More to come
•Primark will also have 28 outlets
in Spain after opening five new
stores in the debt-laden country
•Its margins benefited over the
summer from lower costs linked to
the material falling back in cotton
prices at the turn of the year.
•Shore Capital analyst Darren
Shirley, who continues to forecast
group profits of £970 million for
this financial year 2011, described
Primark as ‘possibly the most
potent retail format in the UK and
Primark bucks downward trend on the high street2011
• The retailer, which has 187 stores in the UK, Ireland, Spain and the
Netherlands, said yesterday that its like-for-like sales rose by 5% in
the six months to the end of February, compared with the previous
• Sales increased during the Christmas holidays and underwear sold
well over the Valentine's period.
• Maureen Hinton, senior retail analyst at Verdict Research, said:
"Primark is doing well because its target market is young and they
are not so challenged by what's going on in the economy as their
parents. Its target market is still buying clothes because they're not
being affected as much by unemployment."
• Primark has opened a new distribution centre at
Thrapston, Northamptonshire, to support further growth, and plans
to open seven new stores in the next six months in places including
Bristol, Cambridge, Portugal and Germany.
How can Penneys have the lowest prices on the
• Offering customers low prices by utilizing a number of cost
• no advertising costs. instead relying on our customers “doing
the talking” about products.
• buy and sell in bulk - Penneys and Primark have over 230
Netherlands, Spain, Germany, Portugal and Belgium.
• Its buying power allows us to buy in bulk and we pass the cost
savings back to the customer.
• Keeping overheads low wherever possible.
• With state-of-the-art logistics systems stores have up-to-the
minute fashion, as soon as it reaches Primark.
Primark is facing tough competition from
1. George at ASDA,
3. Marks & Spencer,
4. TK Max,
8. New Look,
9. Peacock and
Analysis for each major competitor determines that Primark has better
business strength and high market share.
It has good financial strengths and high profitability but relatively poor
quality of management and low standards of technology position.
• Primark is paying least attention to its marketing strategies.
• Primark is facing high competition with quality competitors like
Peacock, Matalan etc. They are offering cheap products as well
and growing at tremendous speed, threatening position of
• Most of Primark customers are switching to rivals because of
their quality products and good marketing strategies which
• Marks and Spencer, the biggest rival of Primark has very
extensive marketing strategies with strong brand portfolio. They
do advertisement on almost every media available; while Primark
do not use even single media for advertisement.
• Marks and Spencer offers frequent promotions for its customers,
they offer loyalty card, and have online sales portfolio, as well
directory sales is among one of their marketing strategies.
• Competitive rivalry can be effectively overcome through
deployment of cross-selling, pricing and co-branding and
marketing strategies. This approach to sales will not only increase
stability of business but also leverage competitive advantage in
target market identified.
Sales trends of Primark and its closest rival is Marks and Spencer
clearly show difference in sales growth of both companies over past
• Business environment is changing way Primark stands in today's
world and it is facing many challenges.
• As technology is emerging, retail business is taking new shape
changing at great speed with increase in number of quality
competitor launching better services.
• Another major reason for this transformation is that buyers are
developing their taste very rapidly and are becoming more
demanding with passage of time.
• Changes in internal & external environment factors like
competitive market, globalization factors, demographical and
social forces, ethical forces, technological changes, economical
factors and political issues are some other major reasons for
various kinds of strategic changes, structural changes, cultural
changes, system changes, process changes within organizations.
Our Recommendations for future
• Redesigning and re launch website with high tech online
shopping portal (Market and Product Development Strategy)
• Expanding market, explore new markets overseas.(Market
• Brand stretch (Product Development Strategy)
• Finding new talent of designer (Product Development
• Offer clothing for a mature market 35+ (Market Penetration
• Diversify (Introduce new product line)
• Introduce range of accessories (Market Penetration Strategy)
• Expand current product lines(Market Penetration Strategy)
• Introduce new product lines (Diversification, Market
• Introduce food Hall or Cafe'(Diversification)
• Introduce loyalty card or store card(Diversification, Market
• Add fragrance section and pharmacies (Diversification)
• Introduce section for electronics (Diversification)
• Enter in emerging markets like telecom (Diversification)
• Open new outlets (Market Development)
• More marketing can be done
• New market share expanding their range of clothes (Market
• New products expanding beyond clothing to include more
shoes, handbags etc(Market Penetration)
• Start own production factories in countries like china and
India to drop cost of production and more less prices
• Introduce customized tailoring and on demand preparation
of dresses (Product Development Strategy)
• For Primark to continue delivering value across range of its
products, it must develop strong marketing as well as has to
enter online shopping portfolio.
• They have to compete with rise of online retailers.
• Although only 4% of clothing sales are currently made
online, this looks set to grow. The value sector has had a huge
impact on fashion market over past few years and rest of high
street has been forced to slash prices in order to compete. If this
influence diminishes, fashion market could become a very
different place to trade in.
• The key challenge faced by Primark is critics who unveiled that
Primark is involved in unethical trading using child labour.
• Other threats are rival companies, customer's changing
requirement which has become potential implications in
implementation and success of new marketing strategies and
hinder its sustainable growth its survival in today's competitive
world. Primark should focus on brand stretch and family
branding strategies to gain competitive edge over competitors.
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