Primark warns of supply chain disruption following Coronavirus

Fast fashion giant Primark heavily relies on China for its supplies of clothing and accessories. Despite parent company AB foods stating it is on track to post full year figures, there are concerns to look for suppliers outside China amid the coronavirus outbreak.

Nigel Frith, a senior market analyst at www.asktraders.com, stated: "Investors remain gripped by coronavirus developments. Today Primark's owner joined the growing list of firms warning over the potential impact of coronavirus. Whilst in the short-term AB Foods said that it was well stocked, there is a risk of supply shortages if factory delays in China are prolonged.

"A short-term supply shock shouldn’t have any serious impact. However, should the coronavirus outbreak disrupt supply chains over a longer period then the impact could be grave. This message isn’t dissimilar to what we have heard from other firms. Yet the fact that the spread of the virus is showing few signs of slowing and is actually increasing outside of China is certainly cause for concern."