Times 100 Case Study Primark Online

Page 1: Introduction

Primark is a subsidiary company of the ABF (Associated British Foods) Group. The company was launched in 1969 in Ireland trading as Penny's. By 2000, there were over 100 stores across Britain and Ireland. By 2012 Primark had 238 branches across the UK, Ireland and Europe. Primark has become distinctive for offering unbeatable value whilst never losing its innovative, fashion-driven edge.

Like many retail fashion businesses, Primark does not manufacture goods itself. Its expertise lies in understanding its customers and working with its suppliers to produce goods to Primark’s specification. It then gets the right goods to the right places at the right prices. Its profitability depends on sheer volume of sales. Primark's value-for-money prices rely on low costs. These are achieved in part through economies of scale and efficient distribution.

Primark’s products are mainly sourced from suppliers in Europe and Asia. Its key sourcing countries are China, India, Bangladesh and Turkey. Putting the manufacturing of garments into these countries creates jobs. These are often at better rates of pay than other types of work on offer, improving overall standards of living.

Corporate social responsibility

Primark has initiated a programme of activities which supports its corporate social responsibility (CSR) stance and ensures that its trading meets the company’s values and ethical standards. Underpinning its programme of activities is Primark’s Code of Conduct which ensures that all workers making its products are treated decently, paid a fair wage and work in good working conditions. For more information please visit www.primark-ethicaltrade.co.uk

This case study looks at Primark’s involvement in the HERproject (Health Enables Returns) which is raising awareness and delivering healthcare education to female workers in supplier countries.

Exposed: Primark's fashion sweatshops that pay children just 60p a day

By Daily Mail Reporter
Updated: 11:10 GMT, 23 June 2008

Since Primark opened its doors in Britain, thrifty fashionistas have been snapping up bargains.

But the low-cost clothes come at a high price for young children toiling in the store's Indian sweatshops.

An investigation revealed that children as young as 11 were working in squalid conditions, sewing tiny beads and sequins onto cheap t-shirts by candle-light.

11-year-old Mantheesh (right) and a young boy work sewing sequins and beads on to Primark tops

Primark recently axed three suppliers in India for passing work to unapproved sub-contractors using child labour.

Children working at home were embroidering dresses and other items sold in the fashion chain's 170 stores.

The revelations were highly embarrassing for a company that has always claimed it is possible to sell T-shirts for as little as £2 without compromising its ethics.

War on Want supporters demonstrate outside the Primark shop on Oxford Street today

The company were alerted to the use of child labour in southern India by a BBC Panorama investigation for a programme to be screened on Monday.

The documentary shows children like 11-year-old Mantheesh being paid just 60p a day by factory bosses to work in a refugee camp.

Mantheesh had fled from Sri-Lanka with her aunt and programme makers found her waist-deep in Primark clothes, their labels giving away their destination - the UK and Ireland.

"I go to a house in the camp every day," said Mantheesh.

Investigators found this 9-year-old boy working in the refugee camp sweatshop

"Sometimes we get major orders in and we have to work double quick. I get paid a few rupees for finishing each garment, but in a good day I can make 40 rupees (60p).

"The beads we sew are very small and when we work late at night we have to work by candle - the electricity in the camp is poor."

Teenage girls pick up a few bargains at Primark like this top found in the Indian sweatshop

The BBC Panorama team carried out a six month undercover investigation at one of Primark's major suppliers, Fab and Fabric.

They discovered the Indian company were sub-contracting middlemen who employed children at Bhavanisagar refugee camp.

A Primark spokesman said: "Primark is an ethical organisation and takes its responsibilities seriously.

"It's an  absolute outrage for anyone to suggest otherwise.

"The BBC came to us with very serious allegations about the conduct of a small number of factories which we investigated throughly.

"What we found left us with no option but to drop those factories."

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