Introduction of Primark.
Our research purpose
Primark, which was build up in Ireland, is one of the fast fashion leaders in the UK retail market. The all 181 stores spread over Ireland, Spain, and the UK. The competitive advantage of the group is producing volume clothes and selling them in cheap price. Primark sell different catalogue product, women clothing, men clothing, shoes, accessories, baby clothing, children clothing, underwear, swimwear and nightwear. Nearly cover all variety of the clothing. According to Primark website figure, “Primark Stores Lt is a subsidiary of Associated British Foods. Associated British Foods is a diversified international food, ingredients and retail group with global sales of £6.8bn, and 85,000 employees in 43 countries. In the financial year 2006/7, 32 new stores were opened and five smaller stores were closed to give 4.8 million sq ft of retail selling space. Highlights during the year included the opening of London’s Oxford Street store in April. This was extremely successful, selling one million items in its first ten days of trading, and attracting considerable media coverage.”① From the figure, it shows Primark develops extremely fast and successfully. Particularly, Primark Oxford Street Store success means British consumers accept Primark in some way. This is a good sign for Primark to explore the UK market.
What fascinates us about Primark is they use both competitive price and up-dated clothes to attract target consumers. In order to find out what does consumers opinions on Primark, our group was divided into two groups. The first group’s task is doing the consumers observation in London’s Oxford street store. Meanwhile, another group is doing the consumer’s observation in slough store. Both groups ask 70 consumers to do the questionnaire, which we will mention below and why they chose Primark rather than other retails. We also ask the local store mangers about more information of Primark. After our observation, we find that Primark’s consumers group is mostly young people, who are age from 23 to 35. In the following report, we will analyze the positive and negative view of consumers and conclude the recommendation. 1). the positive view of customers
Firstly we can see as a discount retailer, Primark is successful because it offers customers with super-competitive prices. According to our research, 80% customers choose Primark as their favorite because of their cheap price. After a brief search online, the cheapest garments are about 9 RMB, which equals just about 1 pound. What the main reason of such amazing price? Generally, it could be concluded to three aspects.
a) Low overhead and operation cost. Primark always process bulk production and volume buying, which makes overhead cost low and keeps costs down. There are two distribution centers – a 650, 000 sq. ft. unit at Magna Park in Leicestershire, and a 200, 000 sq. ft unit at Naas. These huge centers are a guarantee to its efficient distribution, which lower its operation cost. There are 400 suppliers, most of which are in Asia such as India and China, where the labor cost are much lower than that in the developed countries. According to the secret investigation of Panorama, a program of BBC, it reveals that children were paid as low as 54 pence a day for embroidery and sequin work. No matter who should be responsible for this children labor issue, the cost in its work force really play a key role in the low price.
b) Design is simple and low design cost. As we know, design can create an emotive bond between brand and customer, allowing a retailer to elevate its product into a special experience. Primark makes its clothes in the most popular sizes. Sometimes, Primark copies its rivals’ clothes, such as Monsoon. There are a lot of similar clothing between Primark and its rivals. Imitation of popular prints, motifs and original designs in the market makes Primark...
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