When Harvey Norman announced, with a modest fanfare, just over five years ago, that it was to open two stores in Ireland in the summer of 2003, no one in Irish retailing took much notice. It may have been a big noise in electrical and computer retailing in its native Australia, but it had rarely come to attention in Irish retailing.
After all, other international companies with similar ambitions, like Courts, have come and gone. Few expected anything more with Harvey Norman; how wrong they were. The pushy Australians, with their irritating loud ad slogan 'Go Harvey Go', have made big inroads into the Irish market and are set to become the biggest retailers in their sectors - electrical goods, computers and home furnishing - within the next two or three years.
The company's first Irish stores were in Swords and in Dundalk. More were added over the next few years, keeping to Ireland head Aidan Brady's promise. He said the firm was looking at opportunities and sites across the Republic, intent on being truly nationwide by 2008. But cities such as Galway have yet to see their first Harvey Norman stores, as do big retailing hubs like Athlone and larger towns like Sligo. It recently signed a deal for 4,000 sq m in a new park in Waterford, making the total 14. Several more remain on the cards despite economic downturn.
In 2008, with the 13th store in phase 2 of Carrickmines retail park in south Dublin, Brady has still come close. In the last six months of 2007, Harvey Norman opened two stores, Little Island, east of Cork city, and Castlebar, Co Mayo, its first in north-west Ireland.
The early sceptics have had to eat some not too tasty humble pie, as the company has climbed out of debts from brand building in Ireland. In 2004, it lost more than €3.2m; in 2005, it lost nearly €2.3m. By the end of June 2006, it had accumulated Irish losses of €9.6m, but with tax losses of €7.9m to write off against future profits. Now turnover has been climbing significantly: last year, up to the end of June, was €71m with its first small profit made. This year, helped by a rash of new openings, turnover is likely to be €80m and more profitable, with most of the debts recovered. It has just signed an agreement to rent a new HQ in Swords, paying €169 psm on a 20-year lease.
Outside Australia, Harvey Norman has company-owned stores in Ireland, New Zealand and Slovenia, while Singapore and Malaysia are run by a franchisee. Worldwide, it has over 200 stores.
The most recent six-monthly results showed a healthy rise in group net profits, up 31.1 per cent. Ireland had made a fine contribution: its stores on a gross profit margin of around 28 per cent, and as a real employer, with around 500 people on the payroll.
Group chairman Gerry Harvey said the firm is determined to lead in premium new products - just what it's done in the Irish market. Many doubted the brash Australian entrepreneurial spirit would go down well in Ireland, where marketing tends to be more subtle, but clearly it has tapped into current consumer ambitions.Selling at keen prices, generous trade-ins where applicable, and aggressive promotions a constant feature, it is well bedded in across the Republic. Next is Northern Ireland, Scotland and then, to meet chairman Harvey's expansionist ambitions, England.
An unusual rollout, but it's individual and successful. Whether it's an oven, a computer or an honest-to-goodness bed, Harvey Norman is now retailer of choice for many Irish consumers.
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