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March 15, 2022

How click & collect could mark a turning point for Primark

Following the news Primark might be preparing to launch a click & collect service, one analyst says it could mark a turning point in its strategy and be an acknowledgment that fashion retailers cannot hope to be successful in the future without an online presence.

By Beth Wright

GlobalData associate apparel analyst Louise Deglise-Favre says Primark’s potential click & collect debut would be a “great” first step to start its e-commerce proposition.

The UK value fashion retailer sparked interest last week when John Bason, finance director of Primark’s parent company Associated British Foods, told Reuters: “We’re making the digital move forward in a very big way in both the UK and the rest of Europe. That will generate sales and profits for us.

“Does this give us a capability to move further forward? If there was an e-commerce opportunity for us, it will probably be more in the area of click-and-collect.”

He is, however, reported to have ruled out home delivery.

In a statement shared with Just Style today (15 March), a Primark spokesperson said: “We’ve said before that a click & collect service could be a viable option for Primark if we can show it is the right thing for the business. We don’t rule anything out for the future, however, our focus is on improving customers’ experience of Primark online and driving incremental footfall to our stores through the launch of our new website – starting with the UK later this month and rolling out to the rest of our markets into the autumn.”

While GlobalData’s Deglise-Favre notes Primark has not confirmed it is going to offer click & collect and that it might be premature to celebrate its entry into e-commerce, she says, hypothetically, such a service would generate excitement.

She says: “If Primark was indeed to offer a click-and-collect service, it could mark a turning point in their strategy and be an acknowledgement that fashion retailers cannot hope to be successful in the future without an online presence. Primark’s difficulties in FY2021 to rebound to its pre-pandemic levels can be largely attributed to its lack of online retail, as many stores experienced periodical lockdowns, losing out on sales, and not being able to compensate with an online presence.

“Besides, many consumers have continued using online shopping beyond lockdowns and restrictions, out of ease and convenience and Primark’s product ranges alone were not enough to convince shoppers to visit its stores. Primark’s pre-close statement for H1 FY2022 revealed the retailer was still struggling to recover from the pandemic, with like-for-like sales still down 11% of two-years ago.

“While click-and-collect will most likely help Primark’s sales by offering the ability to shop online, it still forces shoppers to visit a store, which many might not want to do. Offering click-and-collect would be a great first step to start their e-commerce proposition, and generate some excitement around the brand, however, it is doubtful that it would be enough to remain competitive in the long run.”

Primark is expected to launch its revamped website in the UK by the end of this month, which will allow shoppers to see in-store stock but the plans revealed so far do not indicate whether or not it will be transactional.

Associated British Foods recently said it expects Primark sales for the first half to be well over 60% ahead of last year, with footfall picking up in most markets, particularly the UK and Ireland.

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