UK-listed retailer Poundland is planning to open six new Dealz stores in Ireland over the next year, chief executive Jim McCarthy has told The Irish Times.
“The plan is to add six additional shops in the next 12 months but we might actually add to that,” Mr McCarthy said. “We’ve got a lot of growth to come.”
The new openings will bring to 41 the number of shops in the Republic for Dealz, which opened here three years ago this month with stores in Blanchardstown and Portlaoise.
The group’s revenues from the Republic amounted to £55 million for the year to the end of March 2014.
Mr McCarthy said Poundland had pencilled in 70 stores into its expansion plans for the Republic. “Internally, our target is 70 but Javelin, our consultants, say that 100 can be done.”
The Poundland chief executive said it would also consider establishing a distribution centre here at some point in the future. “There’s not enough critical mass just yet but, as we continue to grow, it will make us think very hard about setting up a distribution centre.”
Dealz opened its 34th store in Wexford last week with Mr McCarthy reporting that it attracted 3,000 customers on its first day.
To date, the UK company has invested €53.6 million in its Irish network with about €4.5 million being spent this year on its expansion. It attracts about 200,000 customers a week to its Irish stores.
Dealz was a new brand launched here by Poundland, targeted at the value end of the retail market. Most of its products are branded and are sold for €1.49. In the UK, most of its products sell at £1.
Mr McCarthy said the average spend by Irish shoppers in its Dealz outlets amounts to £6 per transaction. By comparison, UK consumers spend £4.50 on average in Poundland stores.
Why the difference?
“There’s a couple of things. We’ve got a new brand in Ireland and I think there’s probably a bigger value difference in Ireland than in the UK, where there’s more competition.”
Mr McCarthy acknowledged that there are some “green shoots” of recovery in the Irish economy but doesn’t expect it to hinder the company’s growth.
“I think habits have been acquired [in the downturn] by consumers and those will continue. All the figures indicate that people like value and they’re supporting companies like ourselves, Aldi, Lidl and Primark.”