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Primark downsizes its branch network in Germany
The fashion retailer, which has long been spoiled by success, is also feeling the effects of the slump in consumption. Four branches are to be closed and hundreds of jobs eliminated. At the same time, new locations are being sought.
Updated: 04/25/2023, 14:44
Eat. For a long time, the fashion chain Primark put the German competitors under pressure with inexpensive and fashionable goods. But now the low-cost supplier has to pay tribute to the slump in consumption and downsize its branch network.
Four of the 30 Primark branches in Germany are to be closed by mid-2024 and 420 of the 4,500 jobs will be lost, as Primark manager Christiane Wiggers-Voellm told the German Press Agency. A number of other branches are to be downsized.
“Primark Germany is in a difficult and challenging situation,” said Wiggers-Voellm. The company is “overrepresented” in some regions and not represented at all in others. In addition, some shops in Germany are simply too big. As a result, the profitability of the stores is “at an unacceptable level”.
“We regret it if redundancies become necessary”
The Primark branches in Gelsenkirchen, Krefeld, Kaiserslautern and in the Frankfurt Northwest Center are to be closed. The planned cuts should be designed “as socially acceptable as possible”, it said in a letter to the employees. “We regret it if layoffs become necessary, but the planned adjustment measures are unavoidable.” The profitability must be guaranteed in order to preserve the other jobs in the long term.
Some of the remaining 26 shops are to be downsized. The company initially did not provide any information on how many and which ones. In these shops, however, no redundancies are currently planned.
In the past few months, Primark had already closed two branches in Weiterstadt and Berlin and halved the sales area in the branch in Hanover. Nevertheless, the closures do not represent a withdrawal from the German market in installments, emphasized the manager.
Primark online store not planned
“We’re staying in Germany and want to grow sustainably,” she said. Primark is currently negotiating the opening of new stores in regions where the company is not yet present. There are white spots in the store network in large parts of eastern Germany. However, the results of the talks are not expected until the end of the year. However, the new stores will be significantly smaller than the previous branches.
According to the manager, a Primark online shop is still not planned. However, the company has relaunched its website and now at least offers the option of checking the availability of most of the goods in individual stores.
Primark is owned by conglomerate Associated British Foods (AB Foods), which reported falling profits at its textiles business. The reason given by the group was increased costs, which were not all passed on to customers. The first Primark store in Germany opened in Bremen in 2009.
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