Why Primark And ZARA Seize Market Share

As early as the second half of last year, a large number of media reported that Primark had defeated ZARA in Spain. According to the financial data, the annual sales of ZARA in 2013 was 16.724 billion euros, with about 6200 stores worldwide and 1858 in Spain, accounting for about 30%, but the sales only accounted for 20% of the total revenue; Primark, on the other hand, achieved total revenue of GBP 4273 million (equivalent to EUR 5.86 billion), with only about 250 stores in total, and only 40 stores in Spain.

Obviously, there are nearly 400 primary and fast fashion brands Opening speed It can't be compared with other countries. The main advantage is still in the price war. In the economic downturn, consumers are more inclined to cut the budget on clothing.

A few days ago, Primark issued a statement saying that it would officially enter the United States this year. The first store will open in Boston in September. Prior to that, Primark had been mixed up in the "European" market. In fact, it was mainly in Ireland and the United Kingdom. Only ten years ago, store expansion began slowly, and stores were opened in Spain, the Netherlands, Portugal, Germany, Belgium, Austria, France, etc. At present, there are more than 250 stores in total, of which 199 are in Ireland and the United Kingdom.

"As long as you walk into any Primark on weekends, there are at least 70 people in line," Racked said.

so far Primark There is no online shopping service. Although the official website will update the lookbook and its price, the purchase can only be made in the physical store. In 2013, the brand agent sold 20 pieces of products on ASOS to test online shopping. But 12 weeks later, the project was called off. Not because they can't sell, but because the demand is too strong, the transportation cost is greater than the commodity profit. "The profit margin of our single product is very small, which is why we connect online retailer And cannot compete with us. " Primary parent company ABF (Associated George Weston, CEO of British Foods).

In addition, Primark does not have any form of marketing activities. With a huge order volume, it can get the lowest price from suppliers, shorten the distance between fabric suppliers and processing plants, and use skilled workers and mechanical assembly lines and other means to minimize operating costs.

Check the official website of the brand. There is a column called "Our Ethics" in the top main menu. It seems that the brand attaches great importance to the negative news (some of which are false news) that frequently broke out before, and has set up a special page to explain in detail that the reason why they are cheap is not the use of child labor, the use of super low wage OEM, and clearly lists the detailed location of the OEM, as well as a series of environmental protection and social responsibility activities for children.

I believe most people will say that we have Taobao. But I want to point out that at present, Primark mainly sells goods in Europe, but the vast majority of its OEM factories are in Asia. If the stores are opened in China, I believe that its supply costs can be further reduced.

At that time, Taobao Store C and the European "Made in China" retailers would be in a similar position. Primark With brand effect, consumers tend to believe that Primark will have more strict and effective control over upstream factories than general retailers, and the low purchase volume of retailers also limits their inability to eliminate the link of intermediate wholesalers, resulting in significantly higher supply costs than the former.

But I also believe that it is very difficult to win the market in China only by price tactics. After all, more and more Taobao brands that cannot be ignored have preempted this middle market, found a balance in price, design and quality, and subdivided this market. In addition, Uniqlo, the Japanese brand of supermarket shopping, is also a strong competitor.