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The future of Primark – will it survive the effects of the pandemic?

Monday, 15 June, 8am: a long, socially distanced queue is patiently waiting, after three months of sorrow, to re-enter the long awaited paradise – Primark. After the great news that non-essential shops can now open, eager customers prepared to claim their goods queued outside of Primark shops from the early hours of the morning. Is it possible, however, that the shop was even more eager than its customers?

The culture of Primark 

When I think of Primark, I think of a wild, agitated, busy shop. Some people pop in and out of the store continuously, while others spend hours exploring floor after floor; huge queues await at the till, and changing rooms are a colourful mess. Primark does not sell online, nor does it struggle too much to advertise itself, because it knows that people will always randomly visit its busy town centre stores. This agitated, going-in-for-a-few-minutes shopping culture is what works for Primark, what generates its revenue and what keeps it alive. There is no other source of income than that of its great, continuous footfall.

And then, all of a sudden, a worldwide pandemic happens: now, tills are protected by plastic screens, floors are marked to direct circulation, and hand sanitiser is placed at the entrance. This doesn’t sound too bad; the main issue for Primark, however, is that the number of shoppers allowed in-store at a time is significantly reduced. And for a company that bases its revenue   and essentially its cash flow  on instore purchases, this is problematic, as limited customers will automatically result in decreased sales.

The main question that arises is, therefore, how long can Primark survive while social distancing rules are in place? To an extent, there is no way of knowing. Primark was doing just fine before the pandemic, despite the overall decline of the High Street. Now that is it back, however, and may I add with plenty of backlogged stock from the last few months, the store must strike a balance. It will have to sell its surplus stock at reduced prices while also reaching enough revenue to maintain cash flow and break even, all whilst hosting limited numbers of customers. It should also be considered that, while customers would normally be willing to queue for hours for high-end brands with exclusive demand, this is not exactly the market Primark operates in.

The loss of the shopping experience 

Given its online selling presence is non-existent as of now, this could potentially be the time to create one, to generate another source of income. Otherwise, questions arise as to how long will Primark be able to convince shoppers to prolongedly queue for hours, only to be welcomed by a new, fast shopping experience, where the customer is required to buy what they need and exit the premises, in order to make room for the next ‘crowd’. It could be argued, however, that this now falls short of being an experience at all. Shoppers could, on the other hand, take their time in store, like this lovely lady did, spending two hours in the store and calling it ‘a delight’. I am not sure, however, how delighted the socially distanced queue outside would be to hear that news.

Another important, threatening change in the shopping experience is that customers are not allowed to touch an item unless they intend to buy it. I never counted how many times I would touch items in a store, but particularly for clothing, I for one know that I like to feel the material of that dress, test the resistance of that purse, and check that price tag only to put the item back on the shelf. Moreover, fitting rooms are closed for now with the only possible way of returning an item if it does not fit is by queuing again, so we’re back at square one.

With no revenue over the last three months and a stubborn refusal to pay their rent, the only way for Primark to remedy this is through increasing sales. Moving on from the social distancing issue, and assuming Primark manages to get rid of the backlogged stock, the next step is increasing new sales and thus increasing production.

Ethics after the pandemic 

Like most clothes retailers, Primark clothes are made in countries including Bangladesh, India, Pakistan and China. They have a Supplier Code of Conduct, on-the-ground training for cotton farmers on child and forced labour, and even a programme that invests in education for children in Cambodia. It would look like they did their CSR homework and are on top of all things ethical. 

However, a recent UNICEF report warns that a COVID-19 consequence could be an increase in child labour, after 20 years of progress. Families who are most affected by the pandemic are more likely to send their children to work or increase the working hours of those already doing it. It’s only fair to assume that countries more likely to be affected by this crisis are the same countries where Primark, and other retailers, produce their clothes. A question arises therefore into whether Primark will be able to cope with a required increase in production, without directly contributing to an increase in child labour.

The future of Primark is definitely uncertain and open to increased speculations. Part of this is due to their unique selling model of refusing to move to ecommerce, as well as the shopping experience that comes with either spending hours taking each shelf at a time or randomly popping in to buy some hairbands. Whichever type of customer you were, the pandemic does not allow you to be that anymore.

Primark has the advantages of having already previously opened their shops in other EU countries and managing to respect social distancing, as well as their parent company being rich enough to help the shop ride this crisis out. The one thing that Primark does not have, however, is a resistant business model in light of this pandemic. And so, this very much threatens its future success. If you’ll excuse me now, I have a queue to attend to.

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