There is no need to raise Primark prices if consumers have money – AB Foods boss | So Good News
LONDON, Nov 8 (Reuters) – There is no reason to raise prices at fashion retailer Primark when consumers are short of money, the owner’s boss said on Tuesday, adding that the group could expand its customer base if rivals took a different approach.
“With consumers who are hungry there is not much,” George Weston, CEO of Associated British Foods (ABF.L), told Reuters.
He said if Primark raised prices it would continue to sell less and reduce price awareness in the eyes of consumers.
“There is an opportunity for us to break through strongly and increase market share if others take different decisions on price,” AB Foods said after reporting full-year results.
Weston said Primark shoppers were generally more conservative with their spending and budgeted more.
“People buy the things they need when they need them, not just hoping they will need them,” he said.
However, he said that winter products, such as hats, coats and jackets, and products that keep people warm in the house, such as snuddies and thermal leggings have been selling “very well, because we think people have been trying to keep their core temperature.”
Weston also notes that Christmas sales started early.
“People are spreading their Christmas shopping over three or four days, rather than relying on the cash they have in December,” he said.
He said Primark stores in the UK were still performing better than stores in continental Europe. “Northern Europe has a tendency to save money knowing there’s a bill coming, so Germany, the Netherlands, Austria are all close to selling … Spain and Italy are doing well,” he said.
Reporting by James Davey, Editing by Paul Sandle and Kate Holton
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