Discount fashion chain Primark has made its mark in Europe by offering fast-changing fashion at rock-bottom prices. The secret of its success: placing huge orders for top-selling items like socks, tops and jeans and passing on the savings to shoppers.

That is the formula it hopes will help it crack the $200 billion US market next year. With an initial capital investment of under £200 million Primark plans to open a store in downtown Boston towards the end of 2015, have 10 stores in the north east of the country by Easter 2016 and build out from there.

“We’re a volume business. We sell 300 million pairs of socks a year. We sell 150 million T-shirts a year. We don’t have major overheads. We have a very efficient supply chain,” said Primark’s business development director Breege O’Donoghue.

If Primark can overcome the challenges of entering the market in America, where it will compete against established discount rivals Target and Forever 21 as well as players like Gap, American Eagle and Aeropostale, it could be a game changer.

“It’s a big if, and that’s how investors have got to look at this,” said John Bason, finance director of Primark’s parent Associated British Foods, which is 55 per cent owned by the Weston family.

“The bull case is it is absolutely a step change, suddenly the population opportunity for Primark has just doubled – if it works. If it doesn’t work then Primark is a western European brand.”

O’Donoghue thinks the move to the US will be helped by the fact that the north east of the country has a similar climate and strong cultural links to Britain and Ireland, but said Primark was also keen to adapt to a new market.

“We are cautious. We take our time to learn. We want a US business, not a Spanish business, not an Irish business,” she said at a store opening in Madrid in May.

A push into the US presents major challenges for Primark.

It will have to establish warehouses as the country is too far away for stores there to be serviced by its five European warehouses.

It will initially source clothes for the US from its traditional supplier markets of China, India, Bangladesh, Cambodia, Vietnam and Turkey. But rather than crossing Europe, clothing from Asian markets will come across the Pacific, through the Panama Canal and up the east coast.

“They have to develop another supply chain. That’s going to be a challenge but not necessarily a killer,” said Maureen Hinton, global research director at Conlumino, a retail research agency.

While many retailers suffered in the economic downturn Primark thrived. Its profit more than doubled from £233 million in 2007-08 to £514 million in 2012-13, driving a fivefold increase in the share price of its parent, which also has major sugar, agriculture, grocery and ingredients arms.

Founded by Arthur Ryan in Dublin in 1969, Primark now turns over more than £4.3 billion a year from 275 stores in nine countries, contributing half the profit of its parent.

Ann Marie Cregan, Primark’s head of buying for womenswear, says about 10 per cent of the lines in store are brand new each week, with stock turning over six times a season compared with an average of two times for most US retailers.

Primark says some 98 per cent of the clothing it buys comes from factories that also supply other major retailers. The big difference: Primark charges less for comparable quality.

Bason said Primark has the same cost of goods as other major retailers but has a much smaller gross margin – the amount it earns from selling products before the deduction of any selling and administrative expenses.

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