The “Boss” label on the back of Tesco Ireland chief Geoff Byrne’s jeans seems apt as he strides across the upstairs atrium of the College Green Hotel in Dublin towards a meeting room for our interview.
“It’s the look I’m going for,” he jokes. “There’s a subliminal message in there.”
The Hugo Boss jeans look a good fit – as he does, as the newish leader of the Irish arm of the British supermarket chain.
In June, Byrne formally became chief executive of Tesco Ireland, having filled the role last year on an interim basis while his predecessor Natasha Adams was on leave.
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It’s a big role within corporate Ireland. Latest filed accounts for Tesco’s Irish subsidiary show it made a pretax profit of €120.3 million on turnover of €3.26 billion. And it has a 23 per cent market share here.
It’s a high-volume, low-margin business. Some 80 per cent of its overall sales are from food and drink, with non-food items making up the balance.
There are about 1.8 million “active” members of its Clubcard loyalty scheme.
Byrne says Tesco’s biggest challenge right now is “keeping prices down for customers”, with inflation in grocery prices running at about 5 per cent, according to recent data from the Central Statistics Office.
“We’re working really hard at that while also trying to keep our staff and colleagues happy to provide enough reward to keep it meaningful for them, while giving a bit back to your shareholders.”
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It’s a juggling act.
Byrne says the spike in grocery prices has been driven by globally traded commodities such as cocoa, coffee, beef and dairy. “If you take them out of it, a lot of the other stuff is pretty much the same at the moment,” he says.
“We’re working hard not to pass on every price increase to our customers because that’s our job. And if we do, we’ll delay it as long as we possibly can.”
Despite a sharp rise in beef prices, Byrne says its volume beef sales are “slightly positive” year on year.
“Now, people are trading down to cheaper cuts but I’ve been surprised how well our sales of steaks have held up. Then again, I guess the cost of steak in a restaurant is very expensive now.
“A lot of local hotels and pubs have stopped doing them. But I come from a farming community and it’s important that farmers get paid.
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Tesco Ireland is very much in growth mode, allocating €100 million in capital a year for the next five years to add 10 shops annually to its chain.
With 185 stores in the Republic (it also has 45 in the North), you might think we’re at saturation point in terms of the number of Tesco shops that can be supported here.
Not so, says Byrne. “I think we’re a long way off saturation point.
“My ambition would be that every consumer in Ireland would be able to choose to go to a Tesco. Whether they do or not is up to them, but I want to put Tesco in their way at least.
“We’ve done 40 [new stores] in the past five years. The plan is to try and open 10 stores a year going forward, for at least the next three, four, five years. I’m confident we’ll get to 10 this year.”
“Any town with a population of 6,000 or 7,000 people I think should have a Tesco. Certainly ones with 10,000. I could take you around the country and there would be 30 or 40 large towns where there’s no Tesco.”
As a young lad, I worked in a fruit and veg shop and I loved it. If you like people and banter and a bit of craic, and working in a bustling business, retail is a good place to get on. It’s also very meritocratic and you meet all sorts of people from all sorts of backgrounds
He then rattles off a list of large towns where Tesco has no presence (Enniscorthy, Dungarvan and Carrigaline among them), not to mention Kilkenny city, which has long been a source of frustration for the supermarket giant. “We have an Express store in the middle of it but we don’t have a big supermarket,” he says.
“But we have one going through the planning process, so fingers crossed we’ll get through our speedy planning process. At least we have a site and a planning application.”
In addition, he sees a “lot of opportunity” for its smaller format Express stores, especially in areas where new apartments are being built.
“Express has the most potential. I don’t see us rolling out any big hypermarkets.”
Tesco also recently launch Whoosh, it’s online service promising deliveries within 45 minutes. Byrne says this has performed so well that the retailer “accelerated the Dublin roll-out” by a number of months.
It has also launched in Cork and Galway, which were originally slated for next year. Typically people buy 10-11 items, which are sourced from Tesco shops locally, allowing the company to sweat existing assets, and are sent to customers via Deliveroo, Byrne says.
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Online shopping is now “approaching 10 per cent” of Tesco’s Irish business, making it the biggest player in that segment of the grocery market here, he adds.
Byrne joined Tesco (then known as Quinnsworth) straight from school as a trainee manager on March 15th, 1989.
“When I was in school I had worked a couple of summers part-time in Quinnsworth and I liked it. I had a great store manager, Mrs Murphy, who encouraged me after the Leaving Cert that if I didn’t want to go to college I could go back and they’d get me a job as a management trainee. And I’ve been here ever since.”
He started in a store in Dún Laoghaire, which also happens to be the location of Tesco’s head office, bringing him full circle within the business 36 years later.
He was made a store manager at 24 in Arklow, Co Wicklow. Tesco bought the business in 1997, with Byrne moving on to ever bigger stores in Greystones and the Square in Tallaght before becoming an area manager.
He says Quinnsworth was a “brilliant business with fantastic people in it but was probably always a bit underinvested”. The sale to Tesco brought a “lot of innovation, a lot of investment and a lot of professionalism”.
“It really did change the business. We had about 60 stores [as Quinnsworth] and within 10 years we had well over 100. I was lucky to be a young guy in the right place at the right time.”
Why retail?
“As a young lad, I worked in a fruit and veg shop and I loved it. If you like people and banter and a bit of craic, and working in a bustling business, retail is a good place to get on. It’s also very meritocratic and you meet all sorts of people from all sorts of backgrounds.
“It’s too tough a business with too thin a margin not to be a meritocracy. If you’re smart and you work hard, you can get on. I’ve always liked that.”
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He’s sanguine about the various payroll costs (higher minimum wage, pension auto enrolment and sick leave measures) that the Government has forced on employers in recent times, drawing the ire of business lobby groups such as Ibec and Isme.
“It’s all manageable,” he says. “I would regard us a very good employer. If you take [pension] auto enrolment, we already had a good pension scheme so we’re not starting from zero there. The same with our sick pay, which is very good.
“The average (hourly) rate of pay in a Tesco store now is about €17.60. Our staff have to live too.”
Byrne grew up in Avoca, Co Wicklow. His parents were both “Aughrim people”, his father an electrician and his mother a hairdresser.
At the time it was a “sleepy village”, home to a copper mine and later the location for the popular BBC TV series Ballykissangel.
“For years there was tourism from Ballykissangel. It got another run in Australia a couple of years ago and people started showing up from Australia wanting to get pictures taken.”
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Byrne got to rub shoulders with a young actor called Colin Farrell, who spent time on the show in the late 1990s.
“He was a nice fella. He would go to the local pub for a pint in the evening and play some pool with the lads. I got to play a game with him in Fitzgerald’s of Avoca. He was good.”
Did Farrell win? “He did, yeah.”
Hurling was more Byrne’s sport, thanks to the efforts of a local sergeant who hailed from Clare.
“I was worst corner forward in the county but I enjoyed it.”
In spite of all the price challenges at the minute, Byrne is “positive” about the future for Tesco Ireland.
“People don’t stop going to shops, they may trade up or down on products but it’s up to us to put the right products in front of them. I do think the inflation will tail off and start to normalise in the back end of the year and take some pressure off consumers.”
The Irish economy is “robust and strong”, with a growing population”, he adds – all positives for a retailer.
“We’re going to have to build a lot of houses in the coming years and those houses will needs shops. Overall, I’m very positive.”
Christmas is just around the corner, although the sales uplift is less pronounced in groceries than for other retailers.
“Sales would be up 4-5 per cent in the run-up and then Christmas week you double your sales. But there’s only so much people can eat.”
While Byrne is relatively new to his role as Irish chief, he does have 36 years in the locker with Tesco. Will this be his final role with the supermarket giant?
“I love what I’m doing. I wouldn’t put a time horizon on it. I’ll do it as long as people want me to and as long as I’m really enjoying doing it. Might as well.”
CV
Name: Geoff Byrne
Job: Chief executive, Tesco Ireland
Age: 55
Lives: Avoca, Co Wicklow
Family: Married, with three adult children
Hobbies: Golf (14 handicap), hill walking and reading books. “I’m a bit of an anorak for history books. My wife tells me I need to lighten up and give my brain a rest so I read a bit more fiction now.”
Something we might expect: He shops in Tesco. “Nobody connected to me is allowed to shop anywhere else or they are out of the house for good. But I do visit the stores [of rivals] a lot. You will always learn something from your competitors, and if you think you won’t you’re probably in the wrong place.”
Something that might surprise: He played pool and had a pint with Colin Farrell, when the Irish film star was a member of the cast of BBC TV show Ballykissangel, which was filmed in his home village of Avoca, Co Wicklow.
