Poundland’s upcoming online launch leaves Primark “standing virtually alone”

Poundland’s upcoming online launch leaves Primark “standing virtually alone” as the only major high street retailer without an ecommerce operation, according to analysts.

Earlier this week Poundland announced that it was poised to launch online “home delivery as well as click & collect in-store” as it trials its new ecommerce operation with its 18,000 employees.

The discount retailer is understood to have quietly launched the trial, which offers home delivery to all of its colleagues and “selected guests”, in late February.

Meanwhile Primark’s chief executive continued to defend the budget fashion retailers reluctance to launch an ecommerce operation, despite seeing profits collapse 90 per cent to see losses £1.1 billion over the last six months.

According to ParcelHero’s head of consumer research David Jinks Poundland’s “eventual recognition that combined in-store and online sales are essential now leaves the discount fashion chain Primark standing virtually alone as a major High Street chain whose website is still only a shop window.”

READ MORE: Poundland poised to launch online home delivery and click & collect

Primark has long argued that its ultra-low-margin model simply could not accommodate the increased costs of online delivery, with its chief executive George Weston stating: “Our cost advantage comes from the fact that we are a bricks and mortar retailer which has neither the picking up costs, nor the distribution costs, of an online retailer.”

Jinks argued that if Poundland, which also operates on razor thin margins, can make online delivery viable then Primark should be able to follow suit.

“Every retailer is hoping that there will never be another national lockdown, but a store such as Primark is particularly vulnerable to any future local closures,” he said.

“We believe Primark needs to follow Poundland online. Its core market is young buyers – the age group shown to be least loyal to any one brand and most likely to shop online. Queues outside its stores when lockdown ended earlier this month show it still has fans, but there’s only so much Primark and other UK stores can do to stay relevant without a strong web sales presence.

“Meanwhile, we believe Poundland has cleverly embraced the future of the High Street by turning to the ‘dark side’ of retail, opening a so-called ‘dark store’ to fulfil its e-commerce orders. It has closed one of its three stores in Cannock, in the West Midlands, and converted it into a dark store: a shop with staff but no shoppers, using it as an online fulfilment centre.”

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4 Comments. Leave new

  • Steve Howsam
    April 30, 2021 5:56 pm

    It’s not the first time Poundland has traded online , it will be interesting to see what lessons it has learnt from others such as Wilko & Home Bargains and I’m sure a big minimum spend for free delivery and a minimum spend for a click & collect will be on the table at a guess they may do a home bargains case deals to get the margin return that the likes of Wilko has struggled to do to break even let alone turn a profit …

    Reply
  • I work for Primark. This incessant push to get us online is silly. Even despite our Covid losers our stores are doing exceptionally well post lockdown because the British public want to shop. They want to go out and browse, pick up items with their hands, meet friends, etc. We are also built very heavily around complimentary sales which you just do not get in an online platform. Going online would be a huge mistake for us and I do not know why retail “experts” do not understand this. We are supposed to be supporting our high streets, not encouraging their demise.

    Reply
    • Totally agree. There are still plenty of people who do not want to do all their shopping online – especially clothes. As you say there is so much you would miss out on by not seeing it with your own eyes. Just need changing rooms open now and my wife will be going on a spending spree! 🙂

      Reply
      • Chris Davie
        May 24, 2021 11:31 am

        Completely agree Dan & Tony. Buying clothes is a very personal experience – the material, the size, the fit, the design, the colour……you just can’t get that as an experience online. If the future of clothing retail is going to be a back and forth of delivery vans travelling everywhere then that’s surely not a positive progression for the customer, the retail industry and the environment as a whole?

        Reply

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