Are U.S. Retailers Ready to Compete With Primark's Fast-Fashion Frenzy?

12/28/2015
American retailers are continually bumping into one another, all trying to keep up with the latest consumer shopping trends. It makes sense, then, that another contender has stepped into the ring to shake up the U.S. fashion retail market in a big way.

Primark launched its first U.S. store in Boston in September. Specializing in apparel priced 30 to 40 percent lower than what U.S.-based companies charge for similar items, its thrifty business model has caught many stateside retailers off guard. To maintain a fighting chance, U.S. retailers need to monitor American consumers' responses to Primark's grand arrival and — depending on the newcomer's success — reconfigure their own business models.

What impact can Primark have on the U.S. retail market?
The U.K.-based Associated British Foods company owns Primark and makes its mission selling attractive, functional clothes, jewelry, home goods, and novelties at affordable prices. The retailer sells its popular items at 30 percent less than Old Navy and 40 percent less than H&M. But Primark's most remarkable feature is its renunciation of the e-commerce option. Shoppers will need to head out to brick-and-mortar stores to access the seller's wares.

Storming the U.S. market by dispensing high-quality clothing at deeply discounted prices and by offering no online buying options, Primark has certainly — and uncompromisingly — laid down the gauntlet. It's letting competition and customers know it has touched ground.

What is Primark's primary appeal?
Despite North America's ongoing recovery from the Great Recession, consumers remain cautious about spending — making Primark's "fast fashion" a welcome arrival for many. Fast fashion rapidly translates clothing designs from the runway into mass-production replicas that feature great eye appeal, deeply discounted prices and high sales potential.

In fact, Primark's only potential marketing obstacle can actually help the company stand out. By peddling its merchandise in only physical stores, Primark uses different types of sales techniques, such as offering customers a level of exclusivity with its fast-fashion items. Additionally, Primark turns visiting its store into an event instead of an everyday shopping-mall experience.

The retailer's strategy so far also includes striking in or near major U.S. cities, setting up its stateside flagship store in Boston's Downtown Crossing district and planning its next store for the King of Prussia suburb of Philadelphia.

Of course, Primark's impact might not be immediately apparent — especially without online sales numbers — but as it opens more stores around the country, the retailer could easily become a powerful force in the U.S. retail market.

Many U.S. retailers are already taking action in anticipation of the business model's success. For example, Nordstrom Rack continues to open stores to accommodate its customers' desire to visit physical locations to see, touch, and try on merchandise before buying.

So far, though, most U.S. retailers are not keen on accepting Primark's cornerstone practice of selling fast fashion. Many U.S. companies try to steer focus toward high-quality production and results over speedy manufacturing, and some industry experts and fellow retailers question the potentially unsustainable practices associated with it.

If Primark fares well in its first 10 stores, U.S. retailers might feel the pressure to make some swift, striking changes to their own business models. Retailers might need to consider incorporating some lines of fast fashion to compete with Primark's alluring business model that squarely targets fashionable American consumers on a budget.

Do you think Primark's U.S. launch will inspire American retailers to adopt a new business model? Let me know in the comments below!


Sam Bahreini, a seasoned operations officer and agile entrepreneur, is co-founder and chief operating officer of VoloForce, a company that aims to help enterprise retail brands ensure perfect program implementation across multiple locations using automation and tools.
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