Primark hopes luck of the Irish will see it win US hearts, and dollars
The Burnham building in Boston, Massachusetts, is widely regarded as one of the finest pieces of architecture in the city. It was designed can you wash a canada goose parka for the Filene’s department store chain in 1912 by Daniel Burnham, the Chicago architect behind the Selfridges building on London’s Oxford Street, and is on canada goose coat 1000 calorie diets America’s national register of historic places.
But its recent past has been traumatic. In 2007 it fell empty when can someone check if this canada goose outlet website is authentic the branch of Filene’s that it had housed since before the first world war closed. A property developer then gutted the interior, sparking fury in the Boston area.
Now though, the Burnham building has found an unlikely saviour. This week, Primark, the discount clothing retailer, will open its first US store on the site of the former chain’s flagship.
This is the latest stage of Primark’s dramatic evolution over 46 years from a single store – Penneys on Mary Street in Dublin – to a fashion chain with almost 300 stores across Britain and Europe.
Primark has won fans in France, Spain and Germany, but the US will be its biggest challenge yet. An array of major British retailers, including Tesco, Marks & Spencer and Dixons, have all suffered embarrassing failures there.
But securing the Burnham building does at least mean Primark has a prominent location from which to start. “Bostonians knew Filene’s and a number will have shopped there,” said John Bason, finance director of Primark’s parent company, Associated British Foods (ABF). “I think they will be genuinely interested in what happened to it.”
The Boston Primark, opening on 10 September, will be followed by a second US store at the King of Prussia shopping mall near Philadelphia before Christmas. Six more shops will open in 2016, including one in New York. The retailer has chosen to focus on the north-eastern US and always wanted its first store to be in Boston.
“We chose Boston because it is European-looking: it looks across the Atlantic. The Irish connection for this Dublin-based retailer was also a useful emotional connection,” said Bason. “In the first year there will be a lot of learning to do. I think we have a good idea about what fashion and styles will work, but there are some things we can’t learn until we have opened.”
He added that Primark has been preparing to launch in the US “for a number of years”. ABF announced the Boston opening in April 2014 homepage, and Primark has been conducting extensive research since then. It will stock the US stores with clothing from its European suppliers, who will deliver to a new warehouse in Bethlehem, Pennsylvania.
The stores will be replenished with new stock every day and largely sell a collection of Primark’s existing designs which the retailer believes will most appeal to American shoppers, although small number of products have been specifically designed for the US.
“We are not saying we are bringing European fashion to the US,” Bason said of Primark’s approach. “We are saying Primark is a fast-follower in fashion.”
He admitted that Primark management regards the US launch with a mixture of “excitement and anxiety”.
“There will be some things that are right and some things that are wrong,” he said. “It could be a sluggish start. The awareness of buy canada goose jacket cheap Primark [in the US] is well, well below what it is in Europe.” However, even if Bason chooses to downplay expectations, he believes Primark and its low-price fashion can exploit a gap in the American market. “We are going into the US because we believe we have something that is differentiated from what else is there,” he said. “We are not going in saying, ‘You lucky Bostonians – look what we have got for you’.”
Overconfidence and hubris have in the past hampered British retailers’ attempts to move into the US. Tesco, for example, thought it could launch an entirely new brand and concept – its Fresh & Easy foodstore chain– on US shoppers. However, retail consultant Richard Hyman said he thought canada goose coat 1000 calorie meal plans Primark could buck the trend.
“The US has been a graveyard for the vast majority of UK retailers who have gone there,” he said. “The apparel market there is massively overcrowded and, on the face of it, another player is the last thing they need.
“However, US clothing is some way behind ours in sophistication, newness and style. This is particularly true at the value end, which tends to be very samey, poor quality and lacking in fashionability. I think Primark will be extremely successful there.”
Nonetheless, Neil Saunders, the US-based chief executive of retail consultancy Conlumino, warned that Primark would have little margin for error in the face of fierce competition.
“There is no real gap here,” he said. “The market is crowded and competitive and oversupplied with apparel retailers. This is one of the reasons why so many firms – like Sears, American Apparel and Gap – are suffering. Primark is going to have to work hard to stand out.”
The stores would, he said, have to adapt to US shopping habits: “Although Primark is competitive on price it operates an EDLP [everyday low price] model. That’s quite different from a lot of US clothing retailers in Primark’s space, who use extensive discounting, promotions and coupons on top of this to drive footfall and sales.
“The US consumer likes this, and responds well to the idea of getting something at less than the price it is supposed to be sold at. The risk is that being simply the lowest on price may be a bit blunt. Primark definitely needs to make more noise in the US.”
But despite this warning, the opening of the Boston store will be low-key. The retailer is holding be an evening event on Wednesday best place to buy a canada goose jacket night for the American fashion press and bloggers to see its clothing, before the mayor of Boston, Marty Walsh, officially opens the store on Thursday.
And even if Primark does become the latest retailer to fail in its attempt to cross the Atlantic, at least it will have won friends in Boston by breathing new life into the Burnham building.
BAD BRITISH BETS
Tesco Britain’s biggest retailer launched Fresh & Easy in California in 2007 but pulled out six years later, having never made a profit. US shoppers were uncomfortable with Fresh & Easy’s self-service tills and packaged fruit and vegetables, stores were opened in off-beat locations and consumer spending was held back by the financial crisis.
Marks & Spencer M&S spent $750m (£494m) buying men’s clothing retailer canada goose coat 1000 bulbs coupon Brooks Brothers in 1988, but ended up selling it on at a loss. M&S also bought US buy canada goose coat online supermarket chain Kings, but that was also sold in 2002.
Dixons The electrical chain bought Philadelphia-based Silo in 1987. But it struggled to compete with chains such as Best Buy and racked up millions in losses before Dixons gave up in 1993.