Primark pounces on US this week with Boston store
Primark's first store in the United States will open on Thursday, breaking new ground for the Dublin-headquartered chain, which first opened its doors over 40 years ago.
The store in Boston will be the first of a number that Primark is opening along the US east coast.
It's trying to penetrate a market from which retailers such as Tesco and Marks & Spencer have retreated in the past following expensive failed forays.
Primark, which trades as Penneys in Ireland, has been plotting its US entry for some time. It's targeting Boston with the first store in order to capitalise on the Irish-American heritage in the city.
It acquired a historic former department store premises there - Burnham Building - where the first US store will be based. It plans to initially open seven outlets in the US.
Among those heading to the opening is Mark Burlton, the high profile global head of cross border retailing at Cushman & Wakefield, who's been advising Primark on its American plans.
Releasing a trading update yesterday in advance of its full-year results in November, Associated British Foods (ABF) said that it expects full-year sales at Primark to rise 13pc on a constant currency basis. That will be been largely driven by a 9pc increase in selling space.
Sales on a like-for-like basis are expected to grow by 1pc.
"Very high sales densities were achieved by stores opened in the last 18 months and especially by our stores in France, which has been our most successful market entry to date," according to ABF.
It added that Spain, Portugal and Ireland had all performed well for the retailer so far during the financial year. Primark closed a Penneys store in Naas this year. It also shelved plans to develop a new store in the town.
Primark said it has an "extensive pipeline" of new stores to be opened over the next few years, the bulk of which will be in the United States, the UK and Spain.
It will also open new stores in France, in Lyon, Nice and Toulon. Its first Italian store, in Milan, will open next summer.
ABF said that it sources much of its merchandise for Primark in dollars, and that the strength of the dollar has adversely impacted its margins. "However, a good proportion of the impact has been successfully mitigated by our buying teams as they firm up orders for next year," said ABF.
Stock market-quoted ABF, which is controlled by the Weston family that also owns Selfridges, Brown Thomas and Fortnum and Mason, also has interests in grocery brands, agriculture and sugar production.
It said its full-year performance expectations remain unchanged. "Our earnings expectations for this financial year continues to reflect a modest decline in adjusted earnings per share for the group for the full year," it said.