Primark to launch Click & Collect test, sees strong SS22 as holidays return
Primark had big news on Monday and no, it wasn’t that trading is going well (which it is). It was that the company is working on a UK launch of a trial Click & Collect service for the end of this calendar year.
That’s a huge development for Primark, which is a rare major player in fashion retail as it doesn’t currently trade online.
The company said the trial will focus on “a much expanded range of children's products, which we believe has the potential to satisfy unfulfilled demand, driving footfall from both existing and new customers to deliver incremental sales in store”.
The trial will involve up to 25 stores in the northwest as a representative sample of store sizes and formats in its UK estate.
And the company added that Click & Collect “will build to offer customers some 2,000 options across clothing, accessories and lifestyle products, which will cater for a broad range of family needs from furnishing a nursery to clothing children of all ages. Around 40% of these options will be exclusive to Click & Collect”.
It thinks the expansion of the offering “will be particularly attractive for our customers who do not regularly shop in our larger stores”. Its average-size stores can only stock a limited range, “and for these customers the number of options available to them will broadly double, increasing even more for customers of our small stores”.
The orders will be processed and dispatched to stores from a dedicated UK distribution centre via a manual pick-and-pack operation, with plans to automate it “in due course”. Orders will be free to collect and returns will be accepted free of charge in store.
Primark has solidly resisted moving online, despite demand, for years, although it has upgraded its online experience in recent period. It saw “a positive customer reaction” to the April launch of its new UK website that showcases many more products and offers stock availability by store. Traffic is up by around 60%, customers on average are viewing twice as many pages per session, and almost 15% of visitors to the site are using the stock checker facility.
That’s clearly helping sales, even though shoppers can’t currently buy online. The company also said on Monday that the 12 weeks to 28 May saw sales up 81% year on year.
The performance came as all Primark stores were open during the latest quarter, in contrast to last year when most were closed until mid-April.
But importantly, sales in the quarter were 4% higher than the comparable pre-Covid period three years ago. However, that’s largely on the back of new stores. Primark said that like-for-like sales have been improving since the half year, but for the quarter they were 9% below pre-pandemic levels.
In the UK/Republic of Ireland like-for-like sales “improved markedly while in Continental Europe performance only started to improve at the end of the quarter following the removal of remaining Covid restrictions”.
In fact, UK sales were up 61%, and 2% ahead of the pre-pandemic quarter, with like-for-likes only down 4%. Destination city centre stores also improved “with a marked return of tourism accompanied by more office working”.
And Primark's value share of the UK clothing, footwear and accessories market, for the 12 weeks ending 1 May was “broadly in line with” three years ago.
As mentioned, Europe saw a late spurt but like-for-likes were still down 15%. That said, because of easy comparisons with the previous pandemic-hit year, total sales were up 106%. Compared to three years ago, sales were 7% ahead, helped by a 20% expansion of selling space.
Meanwhile, in the US total sales were 34% ahead of three years ago, boosted by new store openings.
Another reflection of the return of tourism and office working was the strong customer reaction to the company’s fashion offer. Its SS22 women's fashion ranges “were well received with their focus on brightly coloured dresses, heels and blouses. Sales of luggage and holiday essentials… strengthened over the quarter as customers looked to holiday travel and leisure activities”.
And licensed product “remained in great demand”, including Lilo & Stitch and Stranger Things products.
Primark remains on track to deliver a full-year adjusted operating profit margin of some 10%.
Copyright © 2022 FashionNetwork.com All rights reserved.