Penneys goes after the cents with US opening
IT was only a matter of time before Penneys went after the cents and dollars of American shoppers.
Now the Irish-driven retail chain will open in Boston, with more stores slated for the north east of America in 2016.
Penneys or Primark, which is headquartered in Dublin's Mary Street, has been buoyed by a successful European expansion, opening 270 stores across nine countries.
Who would have thought that when Arthur Ryan opened for business 45 years ago, that a north inner city store would mushroom in such a fashion.
It will now move into Filene's, an iconic department store retail space in the heart of Boston and a strong Irish-American community nearby will no doubt have influenced their choice of city for baby steps into the tough American retail landscape.
Primark have leased 70,000 sq ft of selling space in the historic Burnham Building, which is currently being renovated at Downtown Crossing. There are plans to open there towards the end of 2015 and negotiations are under way to open further stores in the north east, between Washington and Maine, into the middle of 2016. The US stores will be supported by warehousing in the region.
If anything gave Primark extra confidence last week on the eve of the expansion announcement, it was the vista of all those denim shorts and crop tops at California’s Coachella music festival.
In that sea of US celebrity royalty and 'cool' teenagers, there, amongst the fringing, florals and mesh tops was absolute proof that Primark’s current spring summer 2014 fashion collection resonates totally with the American market.
After a successful leap in retailing from Ireland to the UK, Spain, Portugal, Belgium, Germany, Holland, Austria and most recently France, Primark carried out extensive research before dipping a toe into the competitive American market.
British brands like Topshop and Ted Baker have triumphed in the States but it hasn't been the same success story for others like M&S who failed to jump the Atlantic.
However, Primark - rebranded from Penneys outside of Ireland because of the existence of the American label JC Penneys - have a sound tailwind filling its sails.
The latest results show no sign of growth slipping and profits jumped by 26pc to £298m in the six months to the start of March. The company's tills rang up a 14pc increase in sales last year, worth a total of £2.3bn but the US retail landscape will present lots of challenge.
The Americans love to shop, their appetite for retail is 24/7 and, if they are not online, they are pushing the trolleys in malls and seeking out discounts by presenting coupons.
Key competitors for Primark in the value fashion sector will include Target, who have used personalities like Gwen Stefani to front clothing campaigns.
Forever 21 is another affordable, trend-driven fashion brand to pull in the lucrative 'juniors' sector along with Old Navy which has been a traditional mecca in the US for low cost family fashions.
H&M, a rival from the European scene, has been hugely successful in the US and then there's the locally owned Walmart, the world’s largest retailer in the world, with more than two million employees and driven by the Walton family.
Yesterday it was business as usual at the Mary Street offices in Dublin, and while the management team have to consider everything for their US expansion, the Boston opening is at least 18 months away. In the meantime, Europe continues to grow in volume terms.
Their 12th store in Germany opens in Cologne Neumarkt on May 2. That will mark Primark's 272nd store and 72nd internationally and the following month, their fifth French store opens in Creteil in Paris on June 6.