The clothing retailer Primark, which offers a value range of products, competes directly with designer labels such
Question:
The clothing retailer Primark, which offers a value range of products, competes directly with designer labels such as Burberry and Alexander McQueen.
Primark began as Penneys in Dublin, the Republic of Ireland, in 1969, where it still operates under the same name, and by late 1971, there were 11 stores across the country. Primark’s base increased rapidly when it entered Great Britain in 1973, and by the end of the following year the total number of stores had risen to 22. By 2000, with continued expansion and acquisition, Primark had a store count of 108. The clothing retailer’s presence extended to Spain in 2006; the Netherlands in 2008; Portugal, Germany,
and Belgium in 2009; Austria in 2012; France in 2013; and the United States in 2015. Primark is still one of the fastestgrowing chains in Europe. The company has 287 stores with nearly 11 million square feet of retail space and employs more than 54,000 people in its stores throughout the world.
This growth was made possible thanks to Primark’s extensive planning and goal setting. It was built on the fast-fashion trend that had hit the fashion industry and prided itself on encouraging its employees to set their own personal goals and to make use of the training programs offered.
Primark is one of the most sought-after retail employers.
It has consistently had more applicants for jobs than available positions. Like other organizations, Primark has a purpose and a structure to support and enable its people in carrying out that purpose. The business, which prides itself on customer satisfaction, offers one of the best salary structures in retail but demands the very best, and it gets the best by hiring the brightest individuals interested in retail careers.
Goal-setting by employees is coupled with recognition of strong organizational skills by management. Primark’s Management Trainee Program is aimed at graduates, with key training on buying because the company sources its products from around the world. Interestingly, Primark is one of the few retailers that do not have an online presence;
the company believes that it does not need an ecommerce site (though it does deal with online retailers such as eBay, Amazon, and ASOS). In terms of planning and decision-making, the choice to not set up an e-commerce site makes perfect sense. Given that many of its fast-fashion clothing products begin as low as $4, it would take an enormous number of sales to offset the setup costs.
Primark does not advertise either. Instead, it relies on public relations, word of mouth, and the strategic positioning of key stores. Planning is focused on the ability to offer fastfashion products at the lowest possible price. At the same time,
it attempts to ensure that it operates within an ethical framework.
Primark is a member of the Ethical Trading Initiative,
and it supports local charitable organizations and community projects. It is also going through the process of replacing plastic carrier bags with paper bags.
Following criticism in the early 2000s for its use of Asian factories as the primary source of its products, Primark decided to acquire ethical trading status. Since 2014, Primark has continued to improve labor standards across its supply chain in China. Goals included increasing wages, delivering productivity benefits, and creating long-term and lasting improvements.
In order to meet these goals, Primark has simply hired. Progress has been encouraging, and realistic solutions to basic problems have begun to yield major successes.
Primark’s planning approach has clearly been working.
According to research, 75 percent of a consumer’s decisions are made in three seconds at the point of sale. Primark focuses on this and pays particular attention to instantly hooking consumers with its shop fittings, layout, and visual merchandising.
Primark’s planning for the future is well underway.
Discussion Questions
1. Discuss Primark’s decision to bypass e-commerce.
2. Differentiate Primark’s marketing from that of other retailers.
3. Provide examples of fast-fashion chains in your country. How would they cope with competition from an expanding retailer like Primark?
4. What types of planning and goal-setting are described in this case? How would it help Primark’s future operations and expansion?
Step by Step Answer:
Fundamentals Of Management
ISBN: 9781292307329
11th Global Edition
Authors: Stephen P. Robbins, Mary A. Coulter, David A. De Cenzo