E-commerce is electronic commerce means of selling and buying products over the internet. Also, defined as online store made by brands and retailer to make their products available to the customers at their door step, they can browse products, choose and put them in the cart and pay at checkout. It all is done in the convenience and comfort of staying home. Today more than 70% people in the developed countries prefer this mode of shopping. But what you think without e-commerce or having an online store a brand cannot be established. And this is true for one of the famous fashion retailer store Primark. Primark originally named as Penneys founded in Ireland, Dublin in 1962. With success, it expands its business in England and now becoming one of the popular fashion retailers with almost over 315 stores without having Primark online store.
Why is Primark not selling Online?
It is a big question in the minds of people that why Primark is not thinking to start online shop? The reason is simple they don’t think it a useful step because:
- Prices of products are meager, and no one can bear to pay shipping cost equal to products price.
- Primark deals in fast fashion outfits as fashion trends changes quickly the returns of the clothes would be a problem in this case.
- Primark stores attract a large number of customers without the aid of an online store and dealing with such large number of shoppers online will be difficult.
CAN PRIMARK GOES WELL WITHOUT ONLINE STORE?
Primark has millions of followers on social media including Instagram, Facebook, twitter, Pinterest with an estimated value of over 7.1 million. According to one estimate, the average sales of top brands including Next, H&M, American Eagle, urban outfitters through e commerce is contributing 13.3 percent of total sales per year but that 13.3 percent is a mature online platform. It approximately takes four years for a newly developed online store to become a mature and total cost of operating an online store of retailers mentioned above comes out to be 8.5 of total annual revenues.
According to the audit report of the financial consultancy firm, it will cost 985 million dollars a year if Primark runs an online store in addition to 50 percent of the yearly cost as start up. These figures show that it will have an adverse impact on total sales annually and till the completion of four years of becoming mature in e commerce, it has to spend 2.4 billion before becoming profitable and then after four years it still has to maintain the standards of products and online services for customer’s satisfaction. Therefore, e commerce is not at all a welcome step for Primark rather than it will be risky if ever in future they decide to start an online business.