Primark22 Nov 2018 11:32
Can't comment on the wider business as had limited exposure to it but do have a working knowledge of the Primark side at a strategic level.
There are lots of things for the business to be proud of, ethical sourcing for a start.
There are also areas where the strategy has not yet caught up with the scale. Decisions that were correct at 50 - 100 stores are not always correct for 300 - 500 stores.
They are aware and have started to take steps to resolve some of the issues already.
They have made good progress in new markets in Europe and the US, they have not yet exploited the counter seasonal effect the southern hemisphere offers to reduce markdowns and obsolete stock holding.
Personal viewpoint is that they would be a great success in Asia, S.Korea in particular would be worth consideration.
I see Primark as a continuing success. That said, it is not a business without risks and challenges, labour rates are going up, labour availability is going down, sustainable cotton production will come under pressure, keeping supply channels open and onboarding new suppliers will therefore become a challenge and may require alternative and more diverse sourcing policies.
The negative press regards fast fashion and the throw away society add to the mix.
Above all things the fickle nature of the target market is probably the single biggest risk factor.
If Primark falls from favour and the tide turns to one of the other fast fashion retailers the decline will be swift and brutal.