Pennys is forging ahead with its Irish expansion plans, with a new shop opening in Tallaght on Thursday. Photograph: Dara Mac DónaillThe new Penneys shop due to officially open in Tallaght on Thursday will be the discount clothing chain’s first new outlet in Ireland for six years, since it opened in Liffey Valley. Back then, the economy was in the middle of a steep upswing. The new Tallaght outlet could hardly be opening at a more difficult time.
Penneys, which is known as Primark outside of its home country, is facing significant challenges. Months ago, in its first ever public set of Irish accounts signed off by its parent, Associated British Foods, it committed to expanding its Irish footprint by 20 per cent. Yet just weeks later, ABF issued a profit warning for the Primark group. Its business model is about to be tested like never before.The inflation crisis is squeezing Primark from all sides.
Meanwhile, the inflation crisis is also chewing up the disposable income of its budget-conscious clientele. The company does not do online sales, so its ability to cut back costs while still reaching its younger customer base are limited. It must open expensive new shops if it wants to grow.
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