Primark commits to payment for outstanding orders

The fast-fashion retailer had already committed to paying in full for any items that were in production, finished or planned for handover by April 17.

Primark will be discussing the details of these payments on a one-to-one basis with suppliers in the coming weeks.

Primark has also now placed £1.2bn of orders since stores reopened to prepare for the coming seasons, with its standard 30-day payment plans in place.

Primark chief executive Paul Marchant said:  “In March, when we had no visibility of how long stores would be closed and already with some £1.5bn of stock in stores, depots and in transit, we had to take a number of actions quickly to ensure we were able to withstand the crisis. This included cancelling orders, which was one of the toughest decisions we have ever had to take. 

“As we began to mitigate costs and could see a reopening timetable, we have prioritised more funds to support the supply chain, including establishing the wages fund and we committed to taking an additional £370m of orders in April. Now that we are trading once again, we have been able to place significant orders worth £1.2bn with our suppliers. 

“We know our actions have been hard for our suppliers, including carrying the costs of these outstanding liabilities. This commitment ensures that our suppliers will have been paid for all in production and finished garments and fabric costs incurred for Primark and now that we are open and trading again, we are able to place new orders. The reality is that we need a healthy, thriving retail environment to underpin a healthy, thriving garment supply chain. This, in turn, will protect the jobs of the millions who work across our industry.” 

The fashion industry has been hit exponentially by the coronavirus crisis, with many suppliers feeling the brunt.