Austerity chic fashion chain Primark and the budget supermarket Aldi yesterday revealed a sales boom as the cost of living squeeze shakes up the high street.
Sales at Primark were up 24per cent for the first half of its financial year, helped enormously by the appeal of its £5 denim shorts and £3 crop tops to teen girls.
While the figure at Aldi rose by 31.1per cent as middle income Britons traded down from major supermarkets in search of bargain wine, fresh coffee and even lobster.
Sales soaring: Primark saw a 24 per cent growth in sales in the first half of this year. The news sent shares in the parent company soaring 8 per cent today
The longest squeeze on living standards in a century, with price rises outpacing increases in incomes, has triggered a radical shift in shopping habits.
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Primark discomforts struggling rival M&S with sparkling sales performance as it keeps winning on the High St
Bottle of gin from Aldi costing just £10 beats well known rival brands in taste test putting it in the same rank as Harrods
High streets are changing with the rise of the likes of Primark at the expense of established brands like Marks & Spencer and Next.
At the same time, Aldi, Lidl, and Poundland together with pawn shops and payday loan firms are thriving.
Primark’s skill has been in turning around the latest catwalk fashions and celebrity trends and offering budget versions in double-quick time.
Sales of its tiny denim shorts and cropped tops took off after being worn by the likes of American teen singers Carly Rae Jepson and Taylor Swift.
Now, virtually every teen girl in the nation can be seen tottering around in similar outfits, regardless of the rain and cold that have blighted the country.
Its other recent best-sellers include £9 satchels, £10 maxi skirts and a jewel collar dress at just £13.
Takings at the group during the first half of its financial year, which ended in March, were up by 24per cent to almost £2billion. This boosted profits by 55per cent to £238million.
The group opened 15 stores during this period, taking the total to 257, while it is expanding both in the UK and overseas with plans for its first outlets in France.
Primark is owned by the giant food company, Associated British Foods, which owns famous brands such as Kingsmill, Ryvita and Twinings, as well as British Sugar.
It described the fashion chain’s performance as ‘exceptionally strong’, saying it had helped the group to post a 25per cent increase in its pre-tax profits, taking them to £452million.
Chic: Primark's summer range, which is on sale in shops, is set to be Latino inspired. They announced today that sales have been booming
Success: Consumers have turned to Primark as they face a squeeze on living standards - and move away from established brands like M&S
Chairman Charles Sinclair said: ‘The Primark success story continues. Trading in the period was very strong, the profit margin was much improved, customers in continental Europe have taken enthusiastically to the Primark brand and there is very real momentum in the addition of selling space.’
Primark’s figures are in sharp contrast to M&S, where recent cold weather and weak consumer spending drove clothing and general merchandise sales down 3.8per cent in the first three months of the year.
Sales at Aldi are up by a remarkable 31.1per cent in a year, according to retail analysts Kantar Worldpanel. At the same time, the figure are German-owned rival, Lidl, rose by 10.1per cent.
Aldi is opening new outlets at the rate of two a month as Britons develop an appetite for its range of quality products at budget prices.
Sales success: Aldi saw sales grow 31.1 per cent in the first three months of the year as budget-conscious shoppers turn away from the big four supermarkets
Budget supermarket success: A cheap bottle of Gin from Aldi was named one of the best ahead of established rivals in a blind taste test
It has based its advertising strategy on a claim that it is able to offer the same quality as big brands for the price supermarkets charge for value own-labels.
At the same time the group has made a conscious effort to attract middle income shoppers who have been forced to cut down on household spending.
Both Aldi and Lidl have a reputation for selling high quality wine at low prices. Also added to the mix are Aberdeen Angus steak, prize-winning champagne, freshly ground coffee, olive oil and parmesan cheese.
Both of these firms are now making a big effort to offer a wide range of fresh meat, vegetables and fruit.
Edward Garner, director at Kantar Worldpanel, said: ‘Aldi has set two records in the latest period, with its highest ever growth of 31.1per cent delivering a record market share of 3.4per cent.
‘Pressure on household budgets is undoubtedly driving some of the growth at the discounters, but messages about quality are starting to resonate.
‘Lidl announced this week that it will increase its fresh meat and poultry floor space by 50per cent within the year, and Aldi’s new ‘convenience’ store in Kilburn is a departure from its traditional edge-of-town offering.
‘These changes are likely to appeal to a new and different group of shoppers which will bolster the performance of the discounters even further.’
At the other end of the scale, Waitrose is also growing strongly with sales up 12per cent in a year. Its reputation for being careful about how it sources its food has won customers as a result of the horsemeat scandal.
M&S, which does more than any other retailer to police its suppliers, has also seen a rise in food sales of some four per cent.