Comprehensive Analysis: PESTLE, SWOT of UK Clothing Retail Industry

This report presents a PESTLE analysis of the UK clothing retail industry, focusing on political, economic, social, technological, environmental, and legal factors impacting businesses like Primark. It identifies the positive and negative impacts of each factor, such as the effects of free trade agreements, Brexit, inflation, consumer preferences, technological advancements, and data protection laws. The report also includes a SWOT analysis, highlighting strengths like brand image and weaknesses like limited online presence. Opportunities for growth, such as catering to plus-sized consumers and overseas expansion, are discussed alongside threats like Brexit uncertainty and competition from Zara and H&M. The analysis further examines the competitive intensity and the bargaining power of suppliers and buyers, concluding with an overview of how strengths and weaknesses interrelate with external macro factors.

PESTLE ANALYSIS OF UK
CLOTHING RETAIL INDUSTRY
Primark

Macro environmental
factors
 Political
 Economic
 Social
 Technological
 Environmental
 Legal

Positive and negative impact of
Political factors
Positive
 free trade agreements has increased
profitability
Negative
 terrorist attack in London in 2017
declined sales.
 Brexit issue affected overall operations

Positive and negative impact of
Economic factors
Positive
 UK is still regarded as a fashion hub which will
boost its operations.
 Primark has not raised its overall pricing structure
which has helped it to attain an edge over
competitors.
Negative
 inflation due to fall of pound on account of Britain’s
exit from EU has decreased demand for clothing.
 presence of decreased wage growth has made the
consumers reduce their buying capacity

Positive and negative impact of
Social factors
Positive
 presence of affordable clothing by Primark as per consumer
taste and preferences of consumers has increased sales.
 rising obesity has favored the operations of Primark as it
offers plus size clothing to men and women.
 Ageing population has opened new clothing area that is for
the old.
 old people have more disposable income in hand which is
most likely to be used by them in spending.
Negative
 ageing population of UK has put a negative impact on its
staff number

Positive and negative impact of
technological factors
Positive
increase in growth of ecommerce, has
given new sales opportunities to
Primark.
clothes can be sold to larger consumer
segment due to online shopping option

Positive and negative impact of
environmental factors
Positive
rise in consumers who are trying to
adhere with ethical as well as
environmental friendly norms.
new trends in fashion market such as
use of organic cotton and clothes made
from recyclable material.
Negative
Need for keeping low carbon footprint
environmental friendly packaging

Positive and negative impact of
legal factors
Positive
the consumer rights laws will require it to become
more responsible towards product and service
offering in terms or pricing, quality and advertising.
It will further be required to take adequate health
and safety measures for its employees.
Negative
as per the new norms of data protection act,
Primark management will be required to be
stringent in the manner they handle the data of
consumers.

SWOT analysis
Strengths
 Good brand image for providing clothing at fairly low prices.
 strong presence in Europe and American nations.
 presence of more than 70000 employees who cater to varying consumer needs.
 Primark is a part of ethical trading initiative.
 presence of organized business structure (Barnes and Hunt, 2013).
 strong consumer loyalty because of its value for money offerings.
 Good investment in customer experience and service.
 clothing for all ages and gender as well as home accessories.
Weakness
 less stylish and fashion oriented in comparison to competitors.
 too much reliance on UK market which generates more than half of its global
turnover (Amit and Zott, 2014).
 Primark lacks an online ecommerce presence which is now that fastest growing
channel in UK retail market.
 Lack of innovation across store outlets which should be in form of visual
merchandising.

SWOT analysis
Opportunities
 cater to the needs of plus sized consumers as half of UK population
is predicted to get obese by 2050.
 focus on overseas expansion in nations other than Europe and USA
 focus more on advertising than just relying on word of mouth
publicity.
 Improve merchandising in its stores.
 Develop a new line of clothing which targets to needs and
requirements of aged consumers.
 It requires to match itself with unique needs of consumers in terms
of fashion and uniqueness
Threats
 Brexit issue caused a lot of uncertainty.
 Competitor firms like Zara, Hand M, Marks and Spencer, ASDA,
New Look.

External analysis
High competitive intensity - a presence of many retailers
that makes the scenario a highly competitive one.
Threat of new entrants – Low as government offers lenient
policies and encourages free entry and exit options.
Bargaining power of suppliers – Low as Primark has got a
presence of wide supplier base and does not demand much
from single one.
bargaining power of buyers – High as there is a presence of
large number of players in industry
Threat of substitute – High as Primark and other competitor
firms are offering similar kinds of products which makes it
easier for consumer to switch from one to other brand.

how strengths and weaknesses
interrelate with external macro factors
 strong brand image consumer loyalty as well as a good
presence in European and US market has led to strong
consumer loyalty that signifies the social factors.
 The presence of ethical trading initiative that has been
undertaken by the company ensures that it gets the needed
political support for its functioning.
 consumers also consider it an eco-friendly friendly company
which thus interrelates to environmental factor of macro
environment.
 The firm has also invested a lot in consumer experience as
well as service and also provides clothing for all ages as well
as gender which ensures that buyers are attracted towards
the brand. This thus integrates with socio cultural factor so
that overall brand value of the company is maintained.