Harvey Norman has good lockdown after learning lessons of crash
Irish consumers appear to have spent heavily on their homes and entertainment
Paschal Donohoe’s budget speech from last year on multiple TV screens in Harvey Norman in Airside Retail Park, Dublin. Photograph: Alan Betson
Although a dark cloud hangs over much of the consumer economy, there are still a few micro-climatic bright spots about the place. One such positive performer looks to be Harvey Norman, the Australian furniture and electronics retailer with 13 outlets in the Republic.
Its most recent stock market trading update, delivered in recent weeks in its home country, shows sales here boomed despite the lockdown. In the five months to the end of May, according to the update, its sales here rose by 25 per cent in Australian dollars. The euro appreciated by 3.5 per cent against the Australian dollar in that time, but that only accounts for a portion of the increase.
Irish consumers, deprived of the pub and holidays and yet to feel the full economic effects of lockdown due to Government wage subsidies, appear to have spent heavily on their homes, snapping up furniture for remote working and televisions to watch Netflix and other services while housebound.
Harvey Norman Ireland’s online sales channel carried it shoulder high through the pandemic while its stores were shuttered.
The chain has had a bumpy 17-year voyage through the Irish economy, which is in its second existential crisis since Harvey Norman arrived in 2003. The company’s performance has closely mirrored Irish economic fortunes for much of that time.
In the economically frothy years shortly after its arrival, its persona was brash and shouty like much of the Celtic Tiger – “Go, Harvey, goooo!” It then followed the economy into a swan dive in 2008. But, like the Irish economy at large, it survived its near-death experience and fought its way impressively out of the Great Recession, toning down its loud mouth and expanding quietly.
Now the economy has gone into another precipitous plunge, but so far Harvey Norman has yet to follow. Its decision in the lean times to invest heavily in its digital operation appears to have paid off handsomely, if its latest trading update is anything to go by.