Dan Coatsworth, head of markets at AJ Bell, believes the group will have to invest in further e-commerce capabilities to support the size of the company.
He said: “Primark offering home delivery is the biggest UK retail news of the year.
“Having full online transactional capabilities is something the company has always shied away from. It has always argued that low price-point items are uneconomical to send, particularly if someone is only ordering a pair of socks or a t-shirt costing a pound or two.
“It stubbornly retained this view for longer than anyone expected, before easing back by launching a click and collect service. We’re now primed for the full home delivery experience.
“While physical stores remain relevant, online shopping is well established and Primark clearly had no choice but to adapt to the modern retail world.
“There is no firm date for when Primark will start home delivery, yet it has made the first step by acquiring Debenhams/Boohoo’s Sheffield distribution centre. That provides the backbone required to process orders and get items on the vans.
“Clearly a business of Primark’s size will need significantly greater logistics scale than one depot, suggesting that the group’s investment in full e-commerce capabilities has only just begun.
“There is also the question of whether the home delivery service will eventually be rolled out to Primark’s other geographic territories as it has so far only committed to Great Britain.”
Contact details are available to account holders.
Create a free account to get in touch with this expert.