Primark shifting gear - and Fairtrade also picking up

Primark sales jumped another 8% in the last six months. But it's not just discount retail that's up.

Last Updated: 06 Nov 2012

Primark has now firmly established itself as one of the recession's big success stories: by managing to sell gear at ridiculously low prices while retaining its style cachet with discerning punters, it has been going great guns at a time when much of the high street has been struggling. Like-for-like sales were up another 8% in the last six months, including a 19% rise in the 16 weeks to January. It now has 196 stores, and over 6m sq ft of retail space.

The Primark budget model has been a riotous success here in the UK (quite literally on one occasion, when crazed bargain-hunters stormed a half-price sale at the flagship Oxford Street store). And the good news for owner Associated British Foods is that the model has proved equally popular overseas: it opened new stores recently in Belgium, Germany and Portugal, and attributes much of its recent success to ‘exceptionally strong performance’ from the company’s 14 Spanish shops. We know our Iberian brethren are a passionate bunch; how long till they build on their traditional tomato-chucking and bull-running festivals with an annual ‘run for the €2 cardigan’?

Of course, not everyone will be pleased to see Primark doing so well – and we’re not just talking about fashion snobs. The budget retailer was the focus of an expose by the BBC’s Panorama in 2008, which found that children were working in Indian refugee camps to produce some of its cheapest clothes. Primark promptly cut its ties with the suppliers and apologised profusely, but it clearly wasn't great for the image. Doesn't seem to have put the majority of punters off, mind...

Still, here’s some consolation for those who worry that Primark’s continued success reflects badly on our recessionary priorities: sales of fair trade products rose 12% last year, outpacing the rest of the market. So clearly people are willing to spend to improve conditions for suppliers. Harriet Lamb, chief executive of the Fairtrade Foundation, praised British punters, saying it was to their credit ‘that they do care and, despite the recession, they are still voting with their wallets for fairness and want to change the indignities of an unjust trading system’.

Today marks the start of Fairtrade Fortnight, in which the Fairtrade Foundation is urging consumers to switch everyday shopping basket items for fair trade items. And it needs the help: despite last year’s impressive rise in sales, the niche sector still only shifted £800m of branded goods last year - a mere drop in the ocean of the grocery market in general, which boasts annual sales of a whopping £150bn. Now that’s a fair old trade...

In today's bulletin:

Brown bullying row a bad example to senior leaders
BA expecting flak to strike - as Lufthansa suffers
Mike Ashley wades in to block Blacks restructuring plan
Primark shifting gear - and Fairtrade also picking up
MT Expert's Ten Top Tips: Supercharge your energy levels

Find this article useful?

Get more great articles like this in your inbox every lunchtime

The questions to ask when everything is unknown

Systemic intelligence is an indispensable skill for business leaders.

How to stop your culture going back to normal after COVID

In this video, Capita's Melanie Christopher and Greene King non-exec board director Lynne Weedall discuss...

This isn't just a health crisis, it's an equality crisis

Inspiring Women in Business winners: In the “new normal”, we must make sure that female...

How to build an anti-racist business

You don't need a long history of championing equality to make a difference.

What are Simon Roberts’ big 3 challenges at Sainsbury’s?

The grocer's new CEO has taken the reins at a critical time.

Should CEOs get political?

The protests that have erupted over George Floyd’s murder have prompted a corporate chorus of...