Strategic Analysis of Primark: A Comprehensive Study of its External and Internal Environment

Strategic Analysis
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Table of Contents
1.0 Introduction..........................................................................................................................3
2.0 UK External Business Environment of Primark..................................................................4
2.1 PESTLE Analysis.............................................................................................................4
2.2 Porter’s Five-Force Model Application...............................................................................6
3.0 Internal Environment Analysis............................................................................................8
3.1 Value Chain Analysis.......................................................................................................8
4.0 Analysis of the SWOT Position...........................................................................................9
5.0 Main Issues Faced by Primark:..........................................................................................10
6.0 Analyze the business unit of the organisation with any name of the strategy which the
organisation can adopt..............................................................................................................11
7.0 Conclusion:........................................................................................................................12
8.0 Recommendations:.............................................................................................................13
Reference List:.........................................................................................................................14
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1.0 Introduction
Strategic analysis is said to be the analysis of an entire organization based on various internal
as well as external factors so that the different goals and objectives that are set by the
company can be achieved. With the help of strategic analysis, the environment that the
company operates in can be analyzed. It also helps to specify the company’s objectives. The
company that has been chosen in this regards is Primark. Primark is considered to be one of
the most important retail stores of the United Kingdom. In this article, the strategic
management of Primark has been done in a detailed manner. In this article, PESTLE analysis,
SWOT analysis, Porter’s five forces as well as value chain analysis of Primark has been done
in a detailed manner.
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2.0 UK External Business Environment of Primark
2.1 PESTLE Analysis
2.1.1 Political Analysis: Britain decided to exit from the European Union in the month of
June 2016 and as a result of this, it caused a great deal of political uncertainty in the whole of
the United Kingdom. However, it can also be said that with the development of Brexit, the
entire nation suffered from a great deal of political turmoil (Zalengera et al., 2014). Due to
the Brexit factors, retail companies like Primark also faced a lot of political uncertainty due to
the fact that it operated from Europe as well. Primark however, benefitted from weak pounds
and after the saga of Brexit, the parent company of Primark also decided to leave the
European Union. The reason for such a decision was that the Brexit saga caused a great deal
of uncertainty in the financial as well as environmental market.
2.1.2 Economic Analysis: After the saga of Brexit, the pound sterling became very low and
as a result of this, there was a lot of economic turmoil in the entire country. As a result of
this, there was immense pressure on London that is regarded as the financial hub of the
country. There are various threats that the investors would be forced to pull out money from
various property funds. The company however, faces various issues that might have an
impact on the overall development of the company as a whole (Abbott, 2015).
2.1.3 Social Analysis: It can be said that Primark faces various social factors that may have
either a positive or negative impact on the company as a whole. It has been seen in some
recent study that there is a growing demand for plus sized clothes. This is because the country
faces a great mass of people that are growing in obesity as well as people are aging at the
same time. A recent study suggests that there are about 7 fat men in every 10 and there are
about 6 fat women in every 10 women. According to another recent study based on the age
group of the people, it has been observed that there are about 60% of people aged 55-65 years
that are buying clothes, with the help of online shopping (Racz et al., 2018).
2.1.4 Technological Analysis: There has been a tremendous growth of e-commerce and as a
result of this, there has been an ever growing competition in the retail industry of the United
Kingdom (Newton, 2014). The competition in the market is opening up due to the easiness of
e-commerce and its operational cost is considerably low. However, it is quite disheartening to
know as a matter of fact that Primark being one of the largest retail companies has not yet
started the use of e-commerce and as a result it becomes highly vulnerable for the company to
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