A life of luxury
Published: 05 November, 2007
Brown Thomas is the name in luxury goods retailing in Ireland, with its main store in Dublin's Grafton Street and regional outlets in Cork, Galway and Limerick, all renowned for the superior quality of their customer service. Despite growing competition from the likes of Harvey Nichols in the Dundrum Town Centre, Brown Thomas keeps piling on the profits.
Its turnover last year was €228m, and pre-tax profits were close to 10 per cent of that figure. The well-heeled customers of Brown Thomas just keep merrily shelling out; price is of little concern, it seems.
The pedigree of Brown Thomas is impressive. The first luxury department store to open in Ireland in 1849, it was founded in Grafton Street by two haberdashers and general drapers, Hugh Brown and James Thomas. In 1971, Galen and Hilary Weston (of Associated British Foods fame) bought the store from the McGuire family, who had run it for many years, when it was close to closure.
Today, it's part of the Weston-controlled Wittington Investment Group, which also owns Selfridges in London and Holt Renfrew in Canada. Galen Weston himself is the second richest man in Canada, and his wife was formerly the Irish teen model, Hilary Frayne.
The big change came in 1995, when Brown Thomas took over rival department store Switzers, on the opposite side of Grafton Street. Switzers had been trading there for over 100 years, and Brown Thomas instituted a complete revamp of the store. The original Brown Thomas store was then sold to Marks & Spencer.
These days, Brown Thomas in Grafton Street is a bastion of top grade men's and women's fashions, cosmetics, home furnishings and hardware. Many top-line brands have their own boutiques within the store, for example, Hermes, Jimmy Choo, Christian Dior and Louis Vuitton.
Although Weston claims that the high-end stores in the Dundrum Town Centre have had little impact on Brown Thomas, stores like Harvey Nichols are also reporting strong and undiminished demand for luxury goods from Irish shoppers.
When Galen Weston bought Brown Thomas, three regional stores came with the package: Cashs in Cork, Moons of Galway and Todds of Limerick, all long since rebranded as Brown Thomas and all greatly developed over the past few years.
Brown Thomas also owns the BT2 chain, with outlets in Grafton Street, the Blanchardstown centre and Dundrum Town Centre. These outlets all sell mass market clothing aimed at younger consumers.
Earlier this year, Brown Thomas sold its 28 a-wear stores to their managers for €70m, rather than the original higher expectation of €85m. This management buyout was backed by Alchemy Partners, a private equity firm; a-wear has 25 shops in the Republic and recent research shows that a-wear outlets in Dublin are among the 10 most visited stores in the city during Saturday shopping.
Northern Ireland has two a-wear outlets, as well as a concession on level two of Selfridges in Birmingham. Before the sale, Weston had ambitious plans to expand a-wear in Britain.
Brown Thomas is now looking north of the Liffey in Dublin, although this is likely to be a medium-term development, either a dedicated Brown Thomas store or a BT2 outlet.
The group is currently adjusting to staff changes at the top. Former chief executive Dalton Phillips left earlier this year to take over the running of Loblaw, Canada's largest grocery chain, at the behest of Galen Weston, who has a 61 per cent stake in the chain, where his son Galen Junior is the executive chairman.
The new chief executive is Nigel Blow, who has joined Brown Thomas from Harrods, a very similar type of operation.
And at the end of last year, the company appointed a new chief financial officer in the shape of Ray Hernan, who joined from a radically different business background with Ryanair.
There is seemingly no let up in demand for the type of luxury goods that Brown Thomas sells, and as a result this top-end retailing business looks set to become one of the most dynamic and profitable elements of the retail sector.
