'This isn't about opening as many stores as we can': Primark U.S. president Kevin Tulip on introducing the value retailer to North America

0:03Hello, everyone, and welcome to the Modern Retail Podcast.

0:30plan is by 2026 to have 60 US locations. Is that right? That is exactly correct. All right. I'm excited to ask about each individual location where they are. No. But just I want to know how you're how you're approaching it, what the US strategy is, given the status that Primark has overseas. I'd love to talk with a guy who's trying to replicate that one way or another over here. But how are you doing, Kevin? Thanks for joining. Yeah, no, thank you for having me. I'm doing great. We just recently opened our 20th store. So we were in Albany in upstate New York. So that was number 20. Seems like we've been on quite a journey this year.

1:10So cut the ribbon on the 20th and actually we're heading towards number 21 now, which is going to be in Arundel Mills. So just outside of Baltimore, that's going to be our first store in Maryland. So looking forward to that in early September. Wow, wow. Congratulations. So how many stores have you opened so far this year? Yes, we've opened seven this year so far. That's a lot of stores. Yeah, I moved to the US about 18 months ago, and we just then announced our ambition for 60 stores by 2026. So we've been pretty busy with the seven stores in the last 12 months there. And obviously, we've still got a few more to go this calendar year.

1:44And then a few leases that we've signed and recently talked about publicly, including our first store in Texas, which is going to be a Macallan. So we're really looking forward. No date on that one yet, but we're really looking forward to getting down there and getting our first Texas store open. Well, congratulations. Let's back up a little bit and talk just about who you are. So correct me if I'm wrong, but you've been at Primark for quite a long time, or at least that's what your LinkedIn says. So 20 years. It is definitely a long time, over two decades now. So I actually started with Primark when I was 16.

2:15Wow. So yeah, it was a weekend job. I'm straight out of school while I was studying. I'm doing four hours on a Saturday, four hours on a Sunday and I really fell in love with retail fell in love with the buzz of a busy store fell in love with the ability to have a lot of colleagues talk to customers about commerciality, about product about leadership, about development there was just so much of those kind of first few months and few years that just really captured my imagination and I really wanted to grow and set myself as a leader within the store that I was in at the time. And then Primark went through a fairly large expansion in the UK at that time.

2:58We're still relatively small, but we went through quite a large growth spurt in the UK, which allowed me to be able to move around a lot. So no, it was a great first few years. Wow. So what would you say your trajectory of roles was? So you started off at a specific store and then you helped it expand into new territories in different parts of the UK. And what were you in charge of essentially? Yeah, so my first sort of management role was I was looking after the ladies wear department of one of our stores in northern England. And at that point, because we had a number of stores that we were opening across the UK, there was this ability, you know, quite early on in my career to be able to move around a lot, to take opportunity, to go for a promotion, not in the same store, but actually, you know, move to a different city.

3:43and that really interested me as well you know at that point to be able to move around to be able to experience different places and you know different different cultures around the UK as well was was really interesting so that allowed me to be able to do it I think you know and I talked to a lot of our team here today in the US about taking opportunity and kind of getting out your comfort zone and looking for those promotions and opportunities outside of the building that you're in I think there's also something healthy about experiencing you know new teams different regions, different cultures, and really kind of grown your leadership presence, I guess, in terms of doing that as well.

4:19So it's still something that I really encourage our teams here today, but it's something that I had the ability to do back then. Absolutely. So could you just give a brief, very truncated history of Primark? I feel like many people know what it is. You know, if you're in the US, you've probably heard about it, or maybe stopped into one of the new ones, or maybe when you went to London once you stopped But I feel like it would be good to just get a sense for how you inside of it describe its difference in the retail ecosystem. So, I mean, we started in 1969 in Dublin with one store on Mary Street.

4:54And our original founder, Arthur Ryan, had the vision of creating a store where there was affordable fashion for the people of Ireland. And that idea spread from Ireland right the way through to the UK in the 70s. with a low number of stores at the time. Then we went through some quite significant growth in and around 2006 to 2008. And then by 2012, we'd opened our first store outside of the UK and Ireland. So that was in Spain. And that was really our first step sort of onto the European continent. And from there, obviously, we started to get new market entrances into the new European countries, right the way through until 2015 when we opened our first US store here in Boston, downtown Croson.

5:42And actually, as we sit here today, the US is one of 16 countries where we currently trade. So when I started working for Primark 20 years ago, it was a retailer on High Street in a shopping area or in a number of UK cities, but certainly wasn't what it is today, which is a European phenomenon. I mean, we talk about Primania, which is this feeling that people get, you know, when a new store opens or new product drops in store. And it's really become a phenomenon where people are taking, you know, buses, coach journeys to come and visit us. You know, when we open new stores, having, you know, hundreds and thousands of people, even in some of our countries, you know, queuing up outside to be able to shop in our stores for the first time.

6:26I wanted to get into that. Primania is such an interesting concept. I've seen it on social media. Would you say that is predominantly in the UK or is that throughout Europe? Would you say like that sort of cult-like line out the door sort of thing? Yeah, really throughout Europe as well. I mean, it obviously started really in the UK as we were opening stores and as we were going into, you know, new cities that didn't have a Primark before. But even from my own experience, you know, working in the Netherlands, in Belgium, seeing it in Germany, you know, we had a lot of countries where that was really building.

6:56When you have a low number of stores, and of course, you don't have an online store, you don't have a transactional website, it built this want of wanting to be there and get in and knowing that some of the stock was selling out really quickly. So you built over time this need and this want to be making the journey to go. And in some of our countries, when we first started, when we had a low number of stores, less than 10, people were really making that journey. And we continue to see it even today. I mean, even when we opened our store in Buffalo in West New York, I mean, the amount of customers that came down on opening day from Canada.

7:33You know, I was talking to people who were up at 5 a.m. to stand in the line from 8 a.m. in the morning before we opened at 11. You know, they discovered the brand previously, whether it was on vacation in London or in Madrid. So they'd known Primark, they'd seen us online, they'd seen the social media following, but obviously didn't have a store that they were able to travel to. So that's really that Prime Mania sort of building. I wanted to ask, because in the U.S., it's difficult. You don't have one-to-one in terms of cultural wants and interests. And it's hard. There are very specific things that a U.S.

8:07shopper knows about that isn't the same, say, overseas. So how are you trying to build that same sort of cult status, that Prime Mania in the U.S.? Like, has it been more difficult to get that kind of line out the door than it has been in Spain or in the Netherlands? Or what are you doing to try and build that anticipation, I guess? I think we, of course, we started in 2015. So we took a fairly slow approach to growth in those early years. So, of course, you know, from a brand awareness standpoint, although we had a small number of stores around the Northeast, I mean, there was, you know, huge parts of the U.S.

8:44that they would never have even heard of Primark before. And as we've continued to open stores, we've seen that continue to build. And I think there's two elements that we really see it and feel it. The first one is around social media. And we recently just announced our Arundel Mills opening date online. And just reading through the comments myself under the post, I mean, every other comment on that Instagram post is around, when is Primark coming here? There's no Primark in my town yet. I can't get to one yet. I saw this in London. Can I get this in my store? So there's definitely on social media that presence.

9:18There's also when we have new product and collaborations coming in. So we have a number of licensed partners that we work with and have worked with for a long time, trusted partnerships, whether it's with Disney, Netflix, Warner Brothers, NBA, NFL. And it's something as recent as even probably our Barbie collaboration that we did. I mean, less than a week in most of our stores, you know, and completely sold out. You know, we had customers phone in stores asking online, where can I still get this product in? So we really see that continuing to build both in new store locations, the want of a new location, as well as some of our product drops that we've got coming in as well.

9:56Can you talk a little about how, well, let's start with the 2015. What was the concept of that first store? Because I know that you've, over the years, shrunk the size of generally your US stores. Is that correct? So what did the first one look like? And what does it look like now? So the strategy was always about, you know, opening a handful of stores and really testing and learning. And I think, look, that's been the approach from the very beginning and still is the approach today, by the way. So, you know, downtown Crossing in Boston, we opened, fantastic opening. But we had, of course, taken a similar store size to what we had in Europe at that time.

10:34You know, again, a very European centralized strategy. We had a lot to learn coming into the US. And of course, we did a lot of homework before we landed in. But yeah, once you open your doors is when you really start to learn some of those lessons. And I'm sure for the team on the ground, there was some hard lessons to learn. But in reality, what we realized was that, you know, that 35 ,000 square foot of retail selling space is the sweet spot. That's what we're looking for in terms of having the right product range from our global range available in the US, from having the right space that, of course, is then profitable for us.

11:10And that's where we then, over time, we started to think about our real estate strategy around that 35 ,000 square foot, on top of everything else that we already knew, as well as what we continue to learn as we opened in new locations. I mean when we opened outside of the northeast in Sawgrass Mills in Florida and then when we opened State Street in downtown Chicago as you can imagine there's more learnings there once you're moving outside of the northeast once you're opening stores in a different state it's got a very different climate so you've got that one global range but then you've got a very different climate you know and obviously you've got a lot Sawgrass Mills has a lot of tourists shopping with us as well from Central and South America so you've got that as well to get in and figure out and learn.

11:56And I think the power of Primark is really around the trust and, I guess, empowerment on the local leadership teams to spend the time learning about their customer, to really looking at the commercial elements of their store, to looking at what products working for them, and to really help tailor the range for their store based on their customer profile. And that's really the fun and the commercial, the commerciality of Primark is really that continuum to learn once we've cut the ribbon, once we've opened the stores for years after. Got it. You go a little bit more into that because I find that fascinating because I would think for a store like Primark, and this is based, well, now it's completely changed because I'm talking with you, but I imagine that the assortment that I would see in one store in Dublin would be similar to the assortment that I would see in the Queens, New York one.

12:44But it sounds like you're saying that there's a very big Central South American population in the Florida area. And so you have a different assortment there and the store associates are empowered to change that up and make it so that's more tailored to that demographic. So it's one global range. So you would see the same products. So you would see the same products. But what we allow our teams to do is, you know, we might have, I don't know, store where leisure wear is just by far and away a bigger mix than what we would see in another store, another area. And rather than completely restricting them from using any autonomy and not being able to kind of bring in an entrepreneurial nature to it, we allow the store teams to really lean into certain product types, to dial up to certain space on certain sections.

13:32And that way, then they can really make sure that the store feels like a very consistent Primark store, whether it's from a brand perspective, whether it's from a product and collaboration standpoint. But over time, that store will continue to learn and will continue to be shaped by the customers that are selling. And I'll give you a perfect example is, you know, we opened in Queens on Jamaica Avenue, which is really our first neighborhood store in the US. Very different from a downtown location, very different from a mall location. So the leadership team in that store have really got to know the community that's shopping there.

14:07And it's a different frequency. You know, the customer in there is, you know, traveling through. There's a lot of commuters. And we can see that the type of product that they're buying is slightly different from what we would see in other stores, even in New York. The team there have got the ability to then make sure the merchandising plays into that, that they're ordering more volume of certain lines that they know they're going to sell. So the look and feel will be consistent, but hopefully over time, the customer in that store or that area start to see more of the product that they're loving and they're buying in bigger volumes than they would see maybe in a different store.

14:42So you mentioned you have the Jamaica Queens one, which is more of a neighborhood spot. You have downtown Chicago, you have downtown crossing in Boston, you have mall locations, like with these new locations, do you have a sweet spot for the type of area, whether it be urban, suburban, etc, for where you want to go? Or how do you choose which area is best for you to open? Yeah, you know, we obviously have a real estate strategy with, you know, where we would want to be. But a lot of that then is really based on around, you know, the location, the criteria, of course, already having, you know, good foot traffic in there.

15:18We're looking for, you know, certain things around, you know, the competitor set that's around us. And then, of course, it's really down to the right space and the right part of the mall, the right building if it's in a downtown location. And that's where for us, you know, the growth has been, you know, slow to a certain degree, but we've taken our time and understood the locations we're going into. This isn't about just opening as many stores as we can. I mean, even our 60 store, you know, roadmap that we've talked about having 60 stores by 2026 is still dependent on those right locations coming up on the right space in the right part of the mall.

15:53And if that isn't right for us, then we won't take the risk in that. I think what we've continued to learn is, you know, lessons, whether it be downtown, whether it be a mall store, that's helped us continue to shape it. And even properties that we will be looking at in the future, you know, continuing to just make small tweaks about the space, the density, the floor, the location within the mall that we would want to be going into. Got it. Can you talk a little bit about the mall, just maybe zoomed out? Because I feel like that's a hot topic for years. It was said the mall was going to die, and then it didn't, and then it changed because of COVID.

16:29So how has the mall as a centralized shopping area, and it sounds like you're focusing on them more specifically, I'm guessing, in downtown areas you're looking at malls, or are you also looking at them in suburban areas? No, suburban areas as well. I think, look, it's very dependent on the mall. I think, look, we all know there is obviously a lot of retail selling space in the US generally. But there are some malls, and there are a lot of malls, which are incredibly busy. I mean, we just opened in Jersey Gardens in New Jersey recently. And I mean, you know, the first time that I stepped foot in that mall was a Thursday afternoon at 4 p.m.

17:03I mean, absolutely packed. Unbelievable, the foot traffic that's going through there. And if you stand there on a Saturday or Sunday, it's even busier. So we knew that, you know, there are locations like that, you know, whether it be Jersey Gardens, Sawgrass Mills, whether it be, you know, some of the stores we've opened recently, where you know that there are certain elements of the criteria that are definitely going to be fulfilled. There are some malls where we go back and we visit a lot. And this isn't about just taking data or a third party giving us a list. This is about us really going in and standing there and spending time, morning, afternoon, evening, weekday, weekend, multiple visits, really going back and understanding is this a place that we know we can be successful and we can have a really sustainable future.

17:49so as we get properties that come up and as we spend the time and we really validate that for ourself that's the moment where we would then go forward with that but there's a lot of work goes in years of work that goes in in terms of choosing these these locations and you know where we've continued to open we've opened in malls where there is already good foot traffic and I'm sure that's not the case for every mall in the US but it's about being selective and about then you know really looking at what other facilities are available in the mall, what's the competitive set in the mall, you know, what's the parking facilities like in that mall, and really making sure that we're doing our homework on that.

18:26What is the ideal competitive set you would have in a mall? If you like, are there a few stores where you're like, we are really complementary to each other, and that would be ideal for us? You know, we obviously watch what other fashion retailers are doing as well. And, you know, there's always that, that thing of you're never going to be successful by yourself. And that's something, you know, as part of our kind of value set, we've always wanted to be on a good high street, in a good downtown area, in a good mall that, you know, looks after the area. We want to join that and be part of that as well.

18:55So look, we're looking for a good competitor set, whether it be, you know, good other fashion retailers, whether it be, you know, things like cinemas, et cetera, that are bringing in additional foot traffic on top. You know, but I say that, I mean, we've opened in a number of mills locations recently, where, you know, they don't have those elements of cinemas, etc. But because it's that sort of off price model where there is foot traffic going to that mall to shop, you know, that's also been pretty successful for us as well. Would you say that the demographic or the type of shopper in the US that you are finding come to Primark is different than what you're seeing in, you know, the UK and Europe stores?

19:33Or is it generally the same general demographic, I guess? It is generally the same demographic. What I would say is that definitely the frequency of visit is quite different. So we would see that, you know, and this is a, you know, a really top level between the two, you know, in Europe, we'd probably have a higher frequency of visit, but probably a lower basket spent. Whereas in the US, we'd have, you know, a lower frequency and a higher basket spend. But even within the US, we see that quite different. You can imagine in downtown locations, downtown Brooklyn, where we opened in December last year, the frequency of visit there is very high compared with, you know, a mall store like King's Plaza.

20:13But you also see the difference there in terms of the number of items and the general basket spend within the two as well. What are you seeing in assortment and choice? Like whether this can be both for US or both in general, how things are going, like trends change people, you mentioned athleisure, I imagine you guys have seen a huge spike worldwide with athleisure. But how has your overall assortment shifted from what it has been traditionally? Yeah, I think you've got to remember that around 60 % of the Primark assortment is really everyday essentials. So, you know, t-shirts, denim, socks, underwear, that kind of thing.

20:46So there's obviously a trend element to it. But, you know, for the most part, it is everyday essentials. Between sort of the US and Europe, there is definitely a bigger lean towards leisure and sportswear that we've got here versus Europe. But actually, you know, there is a lot of similarities, to be honest with you, you know, whether you talk about something like, you know, colorways, denim, etc. There is a lot of similarities. Where we do see some other differences, some interesting differences that certainly have been interesting for me over the last 18 months to get to learn is there's definitely a bigger lean into licenses here than what there is in Europe.

21:23So, you know, when we have a range, whether it be like a really kind kind of evergreen range on Disney with Mickey or Minnie, or whether it's really something like Barbie, we definitely see a higher percentage coming from the US than in Europe. When we think about something like Children's Wear, which is a really big part of our business, that's been probably a biggest growth for us in the US from when we opened in 2015 to where we are today. And I think a lot of that's word of mouth. Obviously, we aren't spending a lot of money on huge marketing and advertisement campaigns, maybe like some of our competitors.

21:59So there is an element of word of mouth, takes a little bit of time to spread. And I think children's wear is one of those where, you know, people have shopped with us, worn it, washed it, trusted it, come back and reboard it. And then, of course, you've got that whole thing between parents of, you know, where's that dress from? Primark, you need to go check them out. It was only$8. So that's continued to grow over time. And really kind of coming out of COVID, you know, there's been some big shifts on there. Of course, we saw the big kind of leisure wear shift, a lot of people working from home.

22:28But actually, that's definitely started to, we started to see sort of more formal and soft fashions increase. Definitely, as there is more people going back into the offices. And of course, we saw the big resurgence of people going back out again. And definitely travel. Travel has been big on everyone's agenda in the last 12 months. Something like luggage for us, which, you know, not a huge part of our business. But the increases that we've seen between luggage and travel accessories and collections like swimwear has just been phenomenal this year. So definitely we've seen people getting back out and booking vacations and getting back on flights.

23:04A lot of stuff I want to dig into, but one that really stuck out was the license part. You say that U.S. shoppers have a greater volume of people who are buying those types of license collaborations, which makes sense when I think about it culturally. We love our Disney tie-ins. How do you go about inking those? Are you always on the lookout for new potential license partnerships? Are they usually inbound? Are you very specific about the ones you do? Are you more open about it? How are you thinking about that entire area of the business? So, look, obviously, as a function, the buying and merchandising team are based in Dublin.

23:43So, you know, centralized in Dublin. And as part of that, obviously, we have a licensed team. headed up by Sarah Jackson there, that would be working with the licensed partners. They would be creating the product, designing the product, and that would be manufactured in the same factories and countries that we're doing our other product in as well. So it is our product. It's unique to Primark. It's not something that people can go buy in other retailers as well. We have a number of licensed partners that we've worked with for a long time. So the likes of Disney has been with us for a long time, and there's a lot of trust there.

24:16Some of the sports licenses are much newer. We're really starting to see the opportunity of that and being able to grow the range in that as well. I think the license team are always on the lookout for the next collaborations to work with. But as part of our values, it's about building great relationships with whoever we're working with. And that includes the license partners as well. So I can imagine for the team, it's not just about moving on to the next one. it's actually about building more and more on those trusted relationships and actually continuing to look at, you know, what are the ranges for the next season, et cetera.