BUDGET FASHION WARS
In a bid to take on rival Primark, Poundland will stock cut-price clothing label Pep&Co in another 91 stores by June, where almost every item will be under £10
YOU CAN already buy everything from bleach to cut-price chocolates there and now the nice people at Poundland want us to buy super-affordable clothing from them too. Convinced there is still a huge untapped demand for socalled “disposable fashion”, the retailer has announced plans to open 91 new Pep&Co fashion outlets within its existing stores by June in a determined bid to become a “major high-street fashion player”.
With items starting at £1 – natch – and the company claiming 95 per cent of its clothing range will cost £10 and under, the plan is to take on Primark at its own game.
The first skirmish in the superdiscount high-street fashion wars took place earlier this month when the two retailers locked horns over the price of a pair of jeans. It started with Poundland claiming it was the best retailer for denim and offering jeans for just £5. In a video on its Facebook page it openly compared its pricing to that of rival store Primark, whose jeggings were selling for £6.
In an instant riposte, the clothing and accessories company with its HQ in Dublin – which itself started selling beauty products from £1 an item in 2014 – trounced the upstart fashion retailer by slashing the price to £4.50.
Poundland, which was bought by South African retail billionaire Christo Wiese in 2016, responded with the comment: “Seems awkward you had to move from £6 to £4.50… watch this space Primark.”
However, with the exception of that piece of marketing nous, Poundland’s Pep&Co clothing range has managed to stay well under the UK fashion radar. Even seasoned style commentators seem unclear about a brand that will be found inside 330 Poundland stores by June – just 20 fewer than Primark, which reported a 150 per cent increase in sales after its successful march across Europe during the previous five years.
According to branding guru Mark Borkowski it is precisely this need to create “brand awareness” that will be the wannabe fashion giant’s greatest challenge. “The bottom line is price but it’s also perception,” he says. “People forget how hard Primark has worked for its influence. The quality of its product has captured the interest of the younger generation, as well as the key magazine fashionistas who can spot a sensational piece of clothing available for a limited time.
“People don’t just buy cheap, they buy cheap and fashionable. That is a huge fence for Pep&Co to jump over.”
Primark of course is famous for its belowaverage pricing: three years ago the average selling price of women’s clothing sold by the chain was £3.87 per item (compared with £10.69 at H&M). According to an article in The Economist, Primania – as this effect is known – “encourages consumers to buy heaps of items, discard them after a few wears and then come back for another batch of new outfits”. And yes, that is “few wears” not “few years”. All of which adds up to massive waste. According to a survey in the spring of 2016, 235 million items ended up on landfill sites as people readied their wardrobes for summer.
“The nature of the disposable aspect of super-cheap clothes adds to landfill and the waste crisis,” says fashion commentator Karen Kay. “My biggest frustration with all fast fashion is the ethics of production and manufacturing. When you can buy a pair of jeans for £3 you do have to question the provenance.”
John Bason, finance director at Primark-owner Associated British Foods, said recently that its clothing brand achieves its low prices thanks to “sleek logistics, a meagre marketing budget and its scale, which helps win bargains from suppliers”. In short it has tiny margins and makes its money on volume.
“Pep&Co will have to show consumers just how it can produce its clothes so cheaply,” agrees Borkowski. “This is a key consideration for today’s cluedup younger audience.
“People want to look good but they also want to feel good. The two aspects harnessed together are an obstacle the new brand is going to have to overcome.”
SALES of disposable fashion also benefit from the “Instagram effect”, a phenomenon pioneered in recent years by online retailer Asos, which sees fashionconscious young consumers posting snaps of themselves on social media.
“Poundland and Pep&Co are not just competing with Primark,” asserts Kay. “As well as the ease of buying online from Asos or Amazon, for example, one of the biggest growth areas in cheap fashion has been supermarket clothes such as George at Asda or Tu at Sainsbury’s.
“Buying a bikini with your bacon is fun but it has created a very different marketplace. Fashion is a very diverse as well as competitive market now.”
The main challenge, she adds, is getting consumers through the door of Poundland to buy clothes in the first place: “After that the bottom line is that people will only come back if they like them.”