Monday 22 October 2018

Harvey Norman in talks to open two new stores

Chief executive Blaine Callard
Chief executive Blaine Callard
John Mulligan

John Mulligan

Australian retailer Harvey Norman is plotting two new stores - in Sligo and Galway - as it continues a sustained expansion plan after nudging into profitability.

The CEO of the Irish arm of the furnishings and electrical chain, Blaine Callard, confirmed that the company is in advanced talks for leases at the two locations. The new stores are likely to employ dozens of staff between them.

"We've had two years of profit in the Republic, opened a new store in Tallaght last year ... had a very strong peak period, and business is robust and growing," said Mr Callard.

Harvey Norman spent about €6m opening a flagship store in Tallaght, south Dublin, last year, in a premises that it owns and developed itself. "We are certainly looking to expand our Irish retail network with several more stores over the next few years," said Mr Callard. He has previously signalled that Harvey Norman could open five or six new outlets in Ireland. It currently has 13.

Harvey Norman has been actively scouting for a site in Galway for more than two years, and, as well as five outlets in Dublin, already has stores in locations such as Cork, Waterford, Limerick, Drogheda and Tralee.

Stock market-listed Harvey Norman entered the Irish market in 2003, but by 2016 had only ever posted a profit here twice. It had racked up accumulated losses of about €110m as it was hit by the recession and tied into onerous leases that charged boom-time rents.

As Ireland's recession hit in 2008, Gerry Harvey, the founder of the chain, lamented that the group should never have entered the Irish market and that its performance here at that stage was "catastrophic".

But the chain's profit in Ireland during 2016 and 2017 reflects a turnaround programme that was initiated by Mr Callard after he was put in charge of the Irish division in 2010.

The chain has now gone from a position where it was expected Harvey Norman would retreat from Ireland, to one where it is a leading electronics seller and where furnishings sales have risen on the back of a resurgent property market.

Mr Callard likened the reversal of fortunes as being like the "Bunnings dilemma, but with a happy ending".

Earlier this week, Australian group Wesfarmers said it's reviewing its ownership of the Homebase chain in the UK and Ireland after buying the business in 2016.

Wesfarmers had hoped to replicate the Australian success its Bunnings hardware chain has enjoyed.

Irish Independent

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