The fashion clothing industry - Case Study Example

Primark operates in 167 in UK, Spain and Ireland with one-third of its stores in Ireland and two-thirds in UK. Since September 2006, 23 new stores have opened to give 4.4 million sq ft of retail selling space. First established in 1969 as Penneys in Mary St (Dublin), Primark Stores Ltd., is a subsidiary of Associated British Foods Plc (ABF) a publicly quoted company. Primark is the leading player in UK's no-frills fashion retailers. Primark is a fast fashion trend setter for the consumers of age below 30. . Primark's profits rose 30% in 2005 off the back of a 17% sales increase (sales were worth over 1bn).

( The Guardian) In 1997, the combined wholesale sales revenue of the UK fashion design companies was about 600m, over half from overseas sales. The fashion clothing sales revenues have grown from just 185m in 1990, an increase of 225% over seven years giving a compound annual rate of growth of more than 18%. (Designer Fashion) The UK industry, though experiencing strong growth, is still small by comparison with France (whose industry, including revenue from perfume, accessories etc, is worth 900m), Italy (1.5bn) and the US (5.2bn). Led by Paul Smith, and international experience suggests that there is room for growth in this sector.

Overall, it is reasonable to project that the fashion industry will continue to grow at around a rate of 5% per year in nominal terms. ((Designer Fashion) Ac SWOT Analysis:While understanding the business strategy of any organization, the initial step to consider the SWOT analysis of the company. According to Chuck Williams, co-author Managing Organizations, "Strength and weakness are considered internal to the company while opportunities and threats are seen in the environment external to the company.

(Williams, C. et al)Strengths: Cost Leadership: Primark's core strength lies in low price offer to the clothing consumer. This can be studied as cost advantage of the firm in the following sections. The company also exhibits Cost leadership strategy. Primark has a tactful strategy in offering speedy markets sales that replicate the hot trends of the fashion show within less time for cheap prices. The clothing is highly admired by teenage girls, mothers and young lads. Speed to market:The primark release the new fashion into the market in a rapid manner.

While that fashion item is still in demand and hot in the market, it appears in the stores of primark. Value for money. Primark gives value to consumer's money. In primark's view, value to money is equal to quality compared to price. So, consumers are fully satisfied with the quality of clothes in primark and about prices.Efficient distribution:Having maximum hype is not enough to sustain in retailing market, delivering in time to retailers is also most important for business. This is possible through the efficient channel partners for distribution to primark.

Delivering the products in time is the factor of success. Segmentation & Targeting: Primark's focus strategy is it targeted the fashion conscious in young people only under the age of 35, by offering high quality. Fashion basics at value for money prices. Primark is proud on its loyal customer base.