Tesco is to create 1,500 jobs in a €100 million expansion that will see the chain diversify beyond its core grocery activities with the unveiling of its first convenience store and forecourt filling station in the Republic.
The opening of six outlets and a 20,000-square-metre distribution centre in Ballymun, Dublin will account for the bulk of the investment. But the UK group's move into the high-growth convenience retail sector and its bid to establish itself as a petrol vendor are likely to prove equally significant.
Tesco's announcement that it is to locate a convenience store in Tralee, Co Kerry ends months of speculation within the industry that it was poised to introduce the profitable "Tesco Metro" brand to the Republic. While the outlet will not trade under the Metro logo, it is anticipated that it will be the first of a number of Tesco convenience store openings over the coming months.
The Irish convenience sector has grown dramatically in recent years. It is dominated by Centra, SuperValu and several smaller players. Tesco's British rival Marks & Spencer late last year signalled its determination to win a share of the market when it declared it will launch a late night store in Dún Laoghaire, Dublin.
Tesco will follow its first foray into convenience with the opening of a service station in Killarney in early 2004. A further three forecourts are planned for greater Dublin and are subject to planning approval.
The group revealed it had increased purchases from Irish suppliers to €1.4 billion annually, a 64 per cent rise since it acquired the Quinnsworth chain for €820 million in 1997. It marked the announcement with an award ceremony for producers in Dublin yesterday at which the Taoiseach Mr Ahern hailed the firm's commitment to "the future buoyancy" of Irish retailing.
Tesco chief executive Mr Terry Leahy said the company was keen to diversify into non-grocery business. He cited its foray into the British telecoms market as an example of profitable subsidiary activities.
The new recruitment drive will bring the numbers employed by Tesco Ireland to 11,500, a rise of 3,500 since its takeover of Quinnsworth. Some 750 jobs will be created in Dublin, 330 in Cork, 150 in Waterford, 100 in Meath, 55 each in Kerry and Carlow and 90 in Donegal. The first new stores will open within months.
