Primark sales rise 20

Primark has reported a 20% sales rise in the last three months desite fears of a backlash over the Bangladesh factory collapse. Photograph: Facundo Arrizabalaga/EPA
Primark has reported a 20% increase in sales over the past three months as the retailer avoided a consumer boycott over the Rana Plaza disaster in Bangladesh.

The plant, which made clothes for Primark and other brands, collapsed in April with the loss of 1,129 lives and triggered frantic attempts by western retailers to improve safety standards. The UK government is holding an industry summit this month in response to the disaster.

Primark’s parent, Associated British Foods, said good weather had been a significant factor in its performance in the three months to 22 June, outweighing the negative publicity.

John Bason, ABF’s financial officer, said: “The biggest effect on sales has been the weather. We haven’t seen any real change from the tragedy. It was a very real tragedy in Bangladesh and I think it has created a new understanding by consumers for the whole industry and the need to address the situation in Bangladesh. Retailers have come together and I think the messages of what needs to be done have been felt throughout the industry.”

Primark has signed up to a legally binding safety accord – along with 70 other retailers including Marks & Spencer and H&M – to carry out independent inspections of factories, and pay for the upkeep of safety standards.

Gap and Walmart signed up to a similar – although not legally binding – accord on Wednesday. It was branded a “sham” by NGOs who claimed inspection findings would remain secret. Bason declined to say whether he was disappointed that Walmart, which owns Asda’s George range, refused to sign the accord recommended by the Ethical Trading Initiative.

He said: “It wouldn’t be right for me to comment, but obviously, we believe what we’re doing is right and the ETI recognises that we have been at the forefront of the new accord.”

ABF donated food to around 1,300 families shortly after the event and compensated3,300 workers in the building, as well as providing long-term support to families of those working for Primark’s supplier who were killed.

Separately, Bason defended the company’s decision to start selling clothes online through fashion website Asos, despite previously claiming the company would never sell on the internet.

He said: “It is only a trial. Online sales are an important part of this industry. We are still going to get a lot of growth throughout stores, but it’s important to get some understanding of how online sales work. We’ve got no immediate plans to start selling anything more online.”

Elsewhere, ABF’s grocery business saw sales improve 8% in the quarter, as the company, which owns the Kingsmill bread brand, signed a deal to supply loaves to the entire Co-op supermarket estate.


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