Yahoo Finance Primark to trial UK click and collect in move into online sales
Primark will trial a click-and-collect service in the UK, in the budget fashion chain’s first significant move into online shopping as it confirmed price rises were on the way.
The high street retailer will launch the trial at 25 stores in the north-west of England by the end of the year, but said it would only cover children’s clothing and accessories, as the company – owned by Associated British Foods (ABF) – tries to draw more families into its stores.
“We have chosen a much-expanded range of children’s products for this trial, which we believe has the potential to satisfy unfulfilled demand, driving footfall from both existing and new customers to deliver incremental sales in store,” ABF said as part of a trading update on Monday.
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Customers will be able to order from about 2,000 items online – only 40% of the range – including nursery furniture, clothing multipacks and licensed products, such as Disney T-shirts, that the retailer said would be “particularly attractive for our customers who do not regularly shop in our larger stores”.
George Weston, the chief executive of ABF, said the trial was about “giving more customers more reasons to come to our stores”. He said the company would test out the idea for several months and, if it proved to bring in additional sales, could take it outside the north-west or add other product categories.
He said shoppers would be able to immediately try on items they had ordered online in designated collection areas and pick up additional items from the store if they wished. Click-and-collect, and in-store returns, will be offered free as part of the trial.
Primark has so far only used its website to give customers a preview of clothes on sale, and more recently to give shoppers information about stock levels in local stores.
The announcement came as ABF issued a trading statement showing that sales at Primark were up 81% over the 12 weeks to 28 May compared with the same period in 2021, at £1.7bn. Sales in the quarter were also 4% higher than the same period in 2019, before Covid and subsequent lockdowns forced its stores to close.
Weston said Primark was benefiting from a rebound in shopping for nights out and holidays, with a 50% increase in sales of suitcases compared with 2019 and surge in sales of other holiday essentials such as beach towels and swimwear.
City centre stores are also performing much better as tourists and office workers return, although sales in those stores are still below pre-pandemic levels.
“The return of tourism and more office working combined with an improvement in the weather across all our markets was reflected in a strong customer reaction to our fashion ranges,” the company said.
Despite disappointing trading figures from online fashion specialists Boohoo and Asos, Weston said younger shoppers were not yet reining in spending significantly suggesting that pay increases for part time workers and less exposure to energy bills had protected them more than “less wealthy families”.
John Bason, the finance director of ABF, said that the cost of living crisis was affecting people but Primark was “as well placed as could be” in the tougher market. “I would be amazed if we don’t get more people coming to Primark than we would’ve done before,” he said.
Nevertheless, Primark is poised to put prices up in the coming weeks, as it first announced in April, and Bason said they were likely to rise again in February as the cost of fabrics such as viscose and cotton had risen as well as energy, transport and labour. The strengthening of the dollar, which most clothing factories are paid in, against the euro and the pound has also increased pressure on costs.
Weston said Primark was also closely watching events in China where lockdowns were affecting some factories and ports, threatening potential disruption to deliveries of stock.
