Primark is in for some more competition in its biggest market as Zara owner Inditex SA plots a UK debut for its ultra-low-cost chain Lefties, a move that could dent the British retailer’s dominance.
The Arteixo, Spain-based group has considered at least four locations for Lefties in the UK with 20,000 square-feet plots most likely, according to people familiar with the matter. It is looking at the Lakeside shopping center in Essex, the Bluewater shopping center in Kent and sites on London’s Oxford Street and Westfield London, the people said, asking not to be named discussing information that isn’t public.
Lefties, which began as a bargain-bin outpost for Zara’s leftover stocks in the 90s, is expected to launch in the UK in 2026. Inditex declined to comment on the specifics of its plans for the market.
The move couldn’t have come at a worse time for Dublin-based Primark, the UK’s largest apparel retailer by volume. Amid intensifying competition from online Chinese giants like Shein and Temu, Primark’s parent Associated British Foods Plc this month said the retailer’s second-half like-for-like sales are expected to be flat in its core market — a vulnerability Lefties could potentially exploit with a fresh, aggressively priced format.
“Lefties definitely is a threat to Primark, which is already suffering from these ultra-low fast-fashion places like Shein,” said GlobalData associate analyst Chloe Tedford-Jones. “If Lefties were to come to the UK and offer click and collect, self-checkouts, self-returns and things like that it would really give them an edge over Primark.”
For now, AB Foods doesn’t seem worried. Lefties’ UK entry would mark the turning of the tables after many years of Primark’s presence in the Inditex unit’s home turf in Spain, opening its 60th store in the country in 2023. Spain is Primark’s second-largest market.
“Lefties is a very good operation,” AB Foods Chief Executive Officer George Weston, told analysts on an earnings call on Sept. 10. “Just as we’ve competed well with them in Spain, so we’ll compete well with them anywhere else.”
Lefties may be an odd name for a retailer in English-speaking markets in the current, polarized political climate. But that may not stop it from becoming a formidable rival to Primark. The Spanish company’s nimble supply chain and speedy online deliveries pose a particular threat since Primark is largely reliant on its network of 197 stores across the UK. The retailer closed its operations during the pandemic lockdowns, and has since started a click and collect service. But it has yet to dive into online delivery.
“Primark will need to have some sort of online delivery as things progress,” Tedford-Jones said, noting that such sales are consistently outperforming the wider apparel market in Britain. Unlike Primark, Lefties offers online shopping, and unlike Shein — which only has occasional pop-up stores — it has brick and mortar outlets.
A new player like the well-heeled Inditex’s Lefties might shake up the $89 billion UK apparel market, affecting the likes of Boohoo Group Plc and Asos Plc — both troubled retailers — and grocers that integrate fashion like George at Asda and Tu at J Sainsbury Plc. Smaller brands River Island and New Look are closing stores as part of broader restructurings. With 6.7 percent of the market in the UK, Primark has turf to defend.
Eroding Primark’s lead might not be easy for Lefties, industry observers said, partly because of the Inditex label’s lower operating costs in Spain.
“Primark has a very, very solid position in the UK market, particularly in the value space,” said Panmure Liberum analyst Anubhav Malhotra, noting the cost differential. But Lefties’ prices show it can go head-to-head with value leaders like Primark and Shein, with dresses on its Spanish website listing for as little as €9.99 ($11.7) and jeans from €12.99.
For Lefties to offer broad online delivery and returns, it would have to grow its UK network to around 30 or 40 stores, something Inditex could achieve in two to three years, Malhotra said.
Primark can take some comfort in the fact that the two chains often appeal to different kinds of shoppers. Lefties is pitched at younger, fashion-conscious consumers chasing trends at rock-bottom prices. Primark’s core customer is largely the household shopper — typically women buying not just for themselves but also for their children and families.
Founded in the 1990s as a Zara outlet, Lefties later began making its own collections. Today, its 210 stores span 18 countries, with Spain, Portugal and Mexico at its core. It has the same supply chain and infrastructure as Inditex brands like Zara. After years of focusing its growth in the Middle East and North Africa, Inditex is now betting on Europe — relaunching in France and making a push into the UK.
Inditex is “testing Lefties in new markets,” Investor Relations Director Gorka Garcia-Tapia told analysts during the firm’s earnings call this month, marking the first time the group has disclosed the extent of Lefties’ physical presence.
Lefties was the only Inditex brand adding stores in the 12 months to July, going to 210 from 198. The retailer launched a new logo this year, and a home line evoking Zara Home at a lower price point. Sales at the Inditex subsidiary in charge of purchasing for Lefties have more than doubled since 2019, according to Spain’s companies registry, providing a glimpse into the budget fashion chain’s success.
By Clara Hernanz Lizarraga and Katie Linsell