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CAsE ApplICATIon 1 CHAPTER 5 • Foundations of Planning 177

Primark Takes on Burberry and Alexander McQueen

he clothing retailer Primark, a value range of products, In terms of planning and decision making, the decision not
would compete directly with designer labels such as to set up an e-commerce site makes perfect sense. Given the fact
50
TBurberry and Alexander McQueen. Primark began as that many of its fast fashion clothing products begin at as low as
Penneys in Dublin, the Republic of Ireland in 1969, where it still US$4, it would take an enormous number of sales to offset the
operates under the same name, and by late 1971, there were 11 setup costs.
stores in the Republic of Ireland. Primark’s base increased rapidly Primark also does not advertise. Instead it relies on public
when it entered Great Britain in 1973, and by the end of the fol- relations, word of mouth, and the strategic positioning of key
lowing year the total number of stores had risen to 22. By 2000, stores. Planning is focused on the ability to offer fast fashion
with continued expansion and acquisition Primark had a store products at the lowest possible price. At the same time, it attempts
count of 108. The clothing retailer’s presence reached Spain in to ensure that it operates within an ethical framework. Primark
2006; the Netherlands in 2008; Portugal, Germany, and Belgium has membership in the Ethical Trading Initiative, and it also sup-
in 2009; Austria in 2012; France ports local charitable organiza-
in 2013; and most recently the Primark . . . tions and community projects.
USA in 2015. Hitting THE MARK It is also going through the pro-
This was made possible cess of replacing plastic carrier
with Primark’s considerable bags with paper bags.
planning and goal setting. It built on the fast-fashion trend that Following criticism in the early 2000s due to its use of Asian
had hit the fashion industry and prided itself on encouraging its factories as the primary source of its products, Primark decided
employees to set their own personal goals and to make use of the to attain ethical trading status. Since 2014 Primark continues to
training programs offered. improve labor standards across its supply chain in China. Goals
Primark is one of the most sought-after retail employers. included increasing wages, delivering productivity benefits, and
It has continually had more applicants for jobs than available creating long-term and lasting improvements. In order to meet
positions. Primark, like other organizations, has a purpose, these goals, Primark hired. Progress has been encouraging, and
people, and a structure to support and enable those people in realistic solutions to basic problems have begun to yield major
carrying out that purpose. Primark is one of the fastest-growing successes.
chains in Europe. The company has 287 stores with nearly Primark’s planning approach has clearly been working.
11 million square feet of retail space and employs more than According to research 75 percent of a consumer’s decisions are
54,000 people in its stores throughout the world. The business, made in three seconds at the point of sale. Primark focuses on
which prides itself on customer satisfaction, offers one of the this and pays particular attention to instantly hooking consumers
best salary structures in retail, but demands the very best; and with its shop fittings, layout, and visual merchandising. Primark’s
gets the best by hiring the brightest individuals interested in a planning for the future is well underway.
retail career.
Goal setting by employees is coupled with recognizing strong Discussion Questions
organizational skills by management. Primark’s Management 5-14 Discuss Primark’s decision to bypass e-commerce.
Trainee Program is aimed at graduates, with key training related 5-15 Differentiate Primark’s marketing effort from other retailers.
to buying because the company sources its products from around 5-16 Provide examples of fast fashion chains in your country. How
the world. Interestingly, Primark is one of the few retailers that do would they cope with they cope with competition from an
not have an online presence. The company believes that it does expanding retailer like Primark?
not need an e-commerce site. Primark is owned by Associated 5-17 What types of planning and goal setting are described in this
British Foods and it outlined the outlook for its various business case? How would it help Primark’s future operations, and
divisions in its 2014 Annual Report. expansion?