This case study explores the operational and strategic challenges faced by Primark, a leading international fast fashion retailer, due to geopolitical disruptions in the Red Sea. The disruption of key maritime trade routes has significantly impacted Primark’s supply chain, resulting in increased logistics costs, inventory delays, and a 15% drop in sales during Q1 2024. The study examines how Primark has responded to these challenges through supply chain adaptation, early ordering strategies, and stakeholder engagement. Using theoretical frameworks such as Supply Chain Disruption Theory, Theory of Constraints, and Lean Supply Chain Management, the analysis highlights the importance of risk mitigation, supply chain diversification, and technological investment. The report also evaluates the impact on internal and external stakeholders, including management, employees, suppliers, investors, and customers.
Primark UK Case Study: Strategic Response to Red Sea Supply Chain Disruptions
1. Introduction
Primark, a global fast fashion retailer founded in Dublin in 1969, operates over 370 stores across 12 countries (Statista, 2024). Despite generating £7.8 billion in revenue in 2021, the company faces significant challenges, notably supply chain disruptions in the Red Sea. Geopolitical tensions, including Houthi rebel attacks and regional conflicts, have disrupted maritime trade routes critical to Primark’s operations (Primark, 2024a; Primark, 2024b). These disruptions have led to a 15% decline in sales and a 20% loss due to increased logistics costs and inventory markdowns (Freight Systems, 2024). Primark has responded by revising its supply chain strategy, engaging with shipping partners, and emphasizing flexibility to mitigate customer impact (Stlouisfed, 2024). This report evaluates the implications of these disruptions, analyzes stakeholder impacts, and proposes strategic solutions using relevant theoretical frameworks.
2. Challenges to Primark
Primark’s reliance on Asia-Europe trade routes has been compromised by Red Sea disruptions, forcing rerouting via the Cape of Good Hope and increasing transit times (Davey, 2024; LSE UK, 2024). The company has faced inventory misalignment, higher costs, and reduced profitability, prompting early ordering and stock adjustments (RTE News, 2024). Air freight is avoided due to cost and environmental concerns. Prolonged disruptions threaten Primark’s ability to maintain competitive pricing and rapid inventory turnover (Thisismoney, 2024). Restructuring the supply chain is complex and costly, and reliance on a single route increases geopolitical risk (Calcalis Tech, 2024). To remain competitive against diversified rivals like Zara and H&M, Primark must pursue supply chain diversification and robust risk management (RTE News, 2024).
3. Purpose of the Report
This report investigates the impact of Red Sea disruptions on Primark’s supply chain and explores strategic responses to mitigate operational and financial risks. It aims to support Primark in maintaining efficiency, profitability, and its competitive position in the fast fashion industry through improved inventory management, cost control, and supply chain diversification.
4. Stakeholder Impact
4.1 Internal Stakeholders
Executives and management must lead strategic adaptations to ensure business continuity and competitiveness (Xydia and Cole-Wright, 2019; Ivanov et al., 2021). Employees, including store managers and warehouse staff, must adjust to new logistics protocols, supported by training and communication (Tricahyaningtyas et al., 2023; Mafruhah et al., 2024).
4.2 External Stakeholders
Supply chain partners must align with Primark’s revised logistics strategies to maintain product flow (Aishwariya, 2019; Stlouisfed, 2024; Wang, 2023). Investors monitor Primark’s strategic response, influencing market confidence and valuation (Mafruhah et al., 2024; Wu et al., 2023; Langley and Rieple, 2021). Customers may experience changes in product availability and pricing, requiring Primark to maintain variety and affordability (Ivanov et al., 2021; Rölfer et al., 2024; Sundarakani et al., 2021; Khaled et al., 2019).
5. Evaluation and Analysis
5.1 Supply Chain Disruption Theory
Red Sea disruptions exemplify supply chain vulnerability due to geopolitical instability, impacting shipping times and costs (Eisenberg, 2019; Freight Systems, 2024; JP Morgan, 2024; Shoe Intelligence, 2024; Aishwariya, 2019). Primark must adapt strategically to maintain profitability and market presence.
5.2 Theory of Constraints
Primark must address bottlenecks in customs, warehousing, and supplier coordination to maintain fast inventory turnover (Perry and Wood, 2019; Auke and Simaens, 2019; Tan and Yu, 2019; Calcalis Tech, 2024; Palazzo and Siano, 2019; Davey, 2024).
5.3 Risk Management
Effective risk management involves identifying vulnerabilities, evaluating impact, and implementing mitigation strategies (Eisenberg, 2019; Izdihar and Dhakirah, 2024; Fondevila-Gascón et al., 2022; JP Morgan, 2024; Auke and Simaens, 2019). Primark should diversify routes, strengthen supplier relationships, and use predictive analytics.
5.4 Lean Supply Chain Management
Lean principles focus on minimizing waste and maximizing efficiency. Primark must enhance forecasting, inventory systems, and supply chain visibility to maintain performance despite longer lead times (Khaled et al., 2019; Fondevila-Gascón et al., 2022; Langley and Rieple, 2021; LSE UK, 2024; Xydia and Cole-Wright, 2019).
5.5 Resource-Based View (RBV)
Primark’s competitive advantage lies in brand reputation and cost leadership. Strategic partnerships and technology investments are essential to preserve these strengths (Mafruhah et al., 2024; Roozen and Raedts, 2020; Stlouisfed, 2024; Palazzo and Siano, 2019; Perry and Wood, 2019).
5.6 Porter’s Five Forces
Supply chain disruptions intensify competitive pressures. Rivals with agile logistics may gain market share. Primark must reinforce supplier relationships, diversify sourcing, and enhance customer engagement (Pratson, 2023; Wang, 2023; Roozen and Raedts, 2020; Tan and Yu, 2019; Tricahyaningtyas et al., 2023).
6. Conclusion and Recommendations
6.1 Recommendations
6.1.1 Diversify Supply Chain and Logistics
Primark should reduce reliance on vulnerable trade routes by sourcing from multiple regions and exploring alternative transport modes. Investments in infrastructure, supplier partnerships, and logistics agility are essential (Wang, 2023).
6.1.2 Strengthen Risk Management and Scenario Planning
Primark must adopt proactive risk identification and scenario planning, including contingency plans and stakeholder collaboration (Wu et al., 2023).
6.1.3 Invest in Technology and Data Analytics
Advanced technologies such as AI and predictive analytics can enhance inventory management, demand forecasting, and supply chain visibility (Xydia and Cole-Wright, 2019).
6.2 Conclusion
Primark’s experience with Red Sea disruptions highlights the fragility of global supply chains in fast fashion. Strategic measures including diversification, risk planning, and technological innovation are essential for resilience and competitiveness. These actions will safeguard operations and reinforce Primark’s market leadership.
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- Maria Bibi (Author), 2025, Primark UK Case Study. Strategic Response to Red Sea Supply Chain Disruptions, Munich, GRIN Verlag, https://www.grin.com/document/1612320
