Associated British Foods (ABF), owner of the cheap-as-chips clothing and accessories chain, revealed plans Monday to extend selling space at the store by 20 percent next year. That means the location, which opened one year ago and currently encompasses four floors of Boston’s storied Burnham Building, will soon comprise roughly 92,400 square feet.
“In the U.S., awareness of the Primark brand started at a low level and has continued to grow. The brand has been well received with very positive customer feedback, particularly for its exceptional value for money and the breadth of its product range,” ABF said in its preliminary trading report for the year ending Sept. 17.
Total sales at Primark, which has 315 stores worldwide, are expected to be 9 percent ahead of last year at constant currency (or 11 percent ahead at actual exchange rates), when ABF reports its final numbers for the year on Nov. 8. The projected rise is attributed mainly to new store openings in the second half that led to a 9 percent increase in selling space, as like-for-likes are expected to be down 2 percent due to warm weather in the lead-up to Christmas and a cold March and April.
“Ireland delivered a strong performance throughout the year, Spain, France and Austria traded well and the Netherlands and Germany improved,” ABF said. “The U.K. performance was in line with the group with good trading in periods of more typically seasonal weather.”
The British pound’s weakening against the U.S. dollar, particularly since the European Union referendum, isn’t likely to have much of an effect on Primark’s margins in this financial year as a result of ABF’s practice of taking out forward currency contracts when garment purchase orders are placed. However, at current exchange rates, margin will be adversely impacted next year, but the company said Primark is committed to leading the value sector of the market with its on-trend product offering and maintenance of its price leadership position in clothing.
In addition to increasing the size of its Boston store, Primark plans to open three more stores in the northeast next year, bringing its U.S. total to eight. Across the pond, five stores are planned for Germany, two more in Italy and a massive 89,000-square-foot location in the center of Amsterdam. Not to mention, a 32,000-square-foot extension to the Oxford Street East store in London will open ahead of the important Christmas selling period.