Join +750K new investors every month who copy stock picks from billionaire's portfoliosSign Up Free

No point raising Primark prices if consumers are cash-strapped - AB Foods boss

Published 08/11/2022, 09:11
Updated 08/11/2022, 09:37
© Reuters.
ABF
-

LONDON (Reuters) - There is little point raising fashion retailer Primark's low prices when consumers are short of cash, the boss of its owner said on Tuesday, adding that the group could expand its customer base if rivals take an alternative approach.

"With cash starved consumers there's not much point," George Weston, CEO of Associated British Foods (LON:ABF), told Reuters.

He said if Primark raised prices further it would sell less and undermine its value credentials in the eyes of consumers.

"There's a chance we'll come through strongly with increased market share if others take different decisions on price," he said after AB Foods reported full year results.

Weston said Primark shoppers were generally being cautious on spending and budgeting more.

"People are buying essentials when they need them, not in anticipation of needing them," he said.

However, he noted that cold weather items, such as hats, scarves and coats, and items to keep people warm in the house, such as snuddies and thermal leggings have been selling "incredibly well, because we think people have been trying not to turn their central heating on."

Weston also reckons Christmas sales have started earlier.

© Reuters. FILE PHOTO: Shoppers holding newly environmentally themed bags stand outside a Primark store in Liverpool, Britain, September 15, 2021. REUTERS/Phil Noble

"People are spreading their Christmas purchases across three or four pay days, rather than relying on cash that they have in hand in December," he said.

He said Primark stores in the UK were still performing better than stores in continental Europe."Northern Europe has a well developed habit of saving money when they know there's a bill to come, so Germany, Netherlands, Austria are all lagging on the sales front ... Spain and Italy are better," he said.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.