Harvey Norman expansion plans hit by lack of sites in Galway

Harvey Norman, the Australian-owned electronics and homewares retailer with 12 stores in Ireland, is being stymied on a planned expansion into Galway because of a dearth of suitable large-scale retail stores.

Harvey Norman Ireland chief executive Blaine Callard said the company was keen to open a new site in the city that would employ up to 50 staff.

“We’re laser-focused on opening something in Galway, but the trouble is there is absolutely nothing available that’s suitable,” he said.

Nama approached
The retailer is believed to have approached developers and owners of land tracts in Galway, understood to include Nama, asking them to build a new store from scratch.

“We’ll probably need something built for us. We want something that is more than 45,000sq ft, on one level, and with car-parking spaces. But there’s nothing in the whole of Galway city. We won’t go there if the site is not right,” said Mr Callard.

The retailer, which entered the Irish market just over a decade ago, yesterday reported strong sales growth here for the nine months to the end of March, in the latest indication that confidence is returning to Irish consumers.

Harvey Norman, which has sales of about €140 million in Ireland, said like-for-like sales at its Irish outlets in the three months to March rose by almost 8 per cent, making Ireland the strongest-performing region in the group. Its sales climbed more than 5 per cent in the three months running up to Christmas and the new year.

Its like-for-like sales slipped by more than 2 per cent in the three months to the end of June last year. Mr Callard said this was because they were benchmarked against the period running up to digital television switchover the previous year.

“In reality, we have had three very strong quarters so far,” he said. “More people are coming through the door, and conversion rates are up, so people are buying and not just browsing. We are bullish about this year.”

Still loss-making
Mr Callard said the turnaround in fortunes of the business, which has racked up losses of about €150 million since it entered the Irish market, was down to the economy and how the company marketed itself.

The company was still loss-making, but he said it was “on track” to return to profitability in the next couple of years.

Harvey Norman was once notorious for its brash advertising image, embodied by radio advertisements urging “Go, Harvey, go!”. Mr Callard ditched the advertisements and credits the image change with helping to improve performance.