THE BIG INTERVIEW: Barry Williams, managing director of Dealz and Poundland UK

By Donna Ahern
THE BIG INTERVIEW: Barry Williams, managing director of Dealz and Poundland UK

Following the announcement this month that it plans to open 10 stores in Ireland next year, Barry Williams, managing director of Dealz and Poundland UK and Ireland, tells Maev Martin why their business model will thrive in a post-Brexit, and increasingly-competitive, retail industry.

Dealz opened its first stores in Blanchardstown and Portlaoise in Ireland in 2011. Now, with 66 stores throughout Ireland, the discount retailer is looking to open a further 10 Irish stores in 2020, making an investment of €10 million and creating over 250 Irish jobs.

Dealz, the European discount retail chain that takes its inspiration from sister UK business Poundland, has now surpassed the 100-store mark, with 46 Dealz stores already open in Poland and Spain.

Dealz is owned by Pepkor Europe, which also operates over 850 Poundland stores in the UK and over 1,500 PEPCO stores in 11 countries in Central and Eastern Europe. “We’ve firmly established Dealz in Ireland which has enabled us to take the brand to other European countries,” says Williams.

“But we will never forget our roots here in the Republic of Ireland and, as we continue to grow here, we will also look to build our infrastructure in Ireland to support that growth. The Irish business environment is a harsh one at the moment.


The biggest challenge that I see for us operating in Ireland is logistics. We serve all of our stores in Ireland through our UK network and, at some point, we will have enough volume in Ireland to justify opening a depot here.

As we continue to grow, we will get to a position where we will have a distribution centre in Ireland and that will drive more efficiencies – I would be confident that we will get to that position within the next five years.”

Growing Market Share

The full Dealz range covers three industry categories: fast-moving consumer goods (FMCG), from shampoo to chocolate; general merchandise, from gardening products to stationery; and clothing, for adults and children.

“FMCG is 55% of our sales in the Irish market, so it is a core part of our proposition,” he says. “The FMCG side hasn’t grown dramatically for us recently but clothing has really taken off.


Our clothing brand PEP&CO is in over 300 stores in the UK and has gone well for us in Ireland – close to 10% of our sales in Ireland are generated by the PEP&CO brand.”

Is Dealz in a position to challenge either the Irish-based multiples or discounters with its grocery retail offering? “I think we are doing it already – we are one of the few good news stories in the Irish grocery retail market at the moment,” he says.

“If the overall grocery retail market isn’t growing and we are growing our share, someone is losing out. We are in all of the major retail spaces and we are offering most of what the major grocery retailers are offering.”

Best-Selling Brands

Speaking of which, Dealz points out that its best-selling products include Lyons Tea, Lotus Biscoff, Kinder Bueno and Quantum Quilts.


“I’m well aware of the big battle in Ireland between Lyons Tea and Barry’s Tea,” he jokes. “Lyons is one of our biggest selling lines and Biscoff is another top selling line.

Batteries sell for us too, but the Kinder brand is massive for us in Ireland. We have between 4,000 and 5,000 lines in a store. We keep everything tight and focused.

We believe in small returns, but lots of them. We only have 66 stores in Ireland, so there are markets and catchment areas that we aren’t exploring at the moment, hence the expansion plans.”

Those expansion plans won’t see the Dealz operation embarking on a new strategy in the Irish market, such as focusing on specific FMCG categories, with a view to further siphoning off market share from either multiples or fellow discounters.

“Our existing proposition is working, so there is no need to adopt a new strategy,” he says.


“With stores all over Ireland, including nine in Dublin and two in Cork and, more recently, the ex-Aldi store that we opened in Tullamore a couple of months ago, we have further ambitious growth plans for the Irish market,” he says.

“We are planning 10 stores by 2020 but if it ends up being 20 stores we will be delighted.

In addition, our success with Dealz in the Republic of Ireland has given us the ambition and confidence to take the brand elsewhere in Europe – and we’re pushing the button on growth in Poland and Spain.”

Uniquely Placed After 31 October

The Dealz announcement is a good news story for the Irish retail sector at a time of extreme uncertainty, with the Irish economy facing into a no deal Brexit, but what impact is Brexit likely to have on the Dealz business model?

“Brexit has had no impact on our business yet, apart from introducing a degree of uncertainty into the market,” he says.

“We are focused on what we can control. Our contingency planning is on the basis of a no-deal scenario. It will bring challenges to the company but nothing that can’t be overcome.”

Dealz have identified migrant labour, tariffs, and congestion at ports as the key challenges to be addressed.

“We have robust plans to deal with all three,” he says.

“Regarding migrant labour, we are a good employer. We take care of our employees and we aren’t as exposed as other industries, so we are confident that there won’t be any staffing issues for us as a direct result of Brexit.

When it comes to congestion, our supply chain will get longer, so we have a plan to build our stock at both ends. With the inevitable tariffs that will be introduced, we will have to drive more efficiencies in our business, so we don’t add any costs to our customers.

All three are challenges that are faced by retailers on an ongoing basis – they are just all coming together at the same time with Brexit.”

In fact, rather than viewing Brexit as a difficulty or ‘challenge’ that has to be overcome, Williams see it as providing a potential business opportunity.

The Dealz business model could mean that it is uniquely placed to grow post-Brexit, while other retailers struggle to find growth in a radically changed market.

“Retailers shouldn’t pass on the costs that come with Brexit to customers, but it is quite likely that a lot of our competitors will have no option but to pass on the additional costs to their customers,” he says.

“Price inflation is the way to build a business in the absence of volume growth, but that doesn’t work for us.

That isn’t our business model so, in that sense, Brexit could work to our advantage vis-à-vis our grocery retail competitors. We are a low-price retailer, so we are ideally placed to continue to thrive and grow in a market where multiples and the more high-profile discounters feel they have no choice but to increase their prices.”

A Simple Approach To Pricing

€1.50 is the price point that Dealz launched at in the Irish market and Williams says that 50% to 60% of their sales in Ireland are at that price point. However, Dealz also offers a wider selection of price points.

“Our multi-pricing approach covers certain lines, such as FMCG products like Lyons Tea, and some general merchandise and clothing items, and our customers are very receptive to that,” he says.

“Customers love the simplicity of our pricing approach - and our amazing pricing. Our business is based on driving efficiency, and technology is enabling us to create a lot of efficiencies in our business.

We see lots of opportunities to make ourselves more efficient and create a better customer experience. We have a team that focuses on value engineering on a constant basis.”

Family Fashion Brand

In 2018, Dealz launched family fashion brand PEP&CO into 30 Irish Dealz stores with a ‘shop-in-shop’.

The discount clothing for men, women, and children, is now in all stores, with edited ranges in smaller locations that are unable to support a full ‘shop-in-shop’.

Many multiples and discounters in the grocery retail space are in, or are moving into, the hardware/general merchandise space, and some, including Tesco with its F&F range, have also entered the clothing arena.

“We plan to extend PEP&CO to any new Dealz locations in the Republic of Ireland,” he says.

“In Ireland, prices at PEP&CO start at €1.50, with almost 60% of items at €5.00 or less, and we are keeping quality high and prices low as we build a business of real scale and volume.

We are competing with Tesco and Penneys and we are competing well. It is about the value equation across the business – price plus quality plus design – that is what unlocks value for customers.”

Swimming Against The Tide

Dealz doesn’t trade online. Williams says that many industry commentators find that surprising. However, adopting the opposite approach to most businesses has worked very well for the retailer so far.

“The discount retailing sector is growing and is forecast to grow at similar levels to the online market, and will, in fact, outpace online for some of the categories that we operate in,” he says.

“Not having the distraction of online has benefitted our business and allows us to focus on our stores and on making them the best they can be.

The DNA of our business is that we like swimming against the tide.

We are entering our 30th year as Poundland and our eighth year as Dealz, which is a solid track record of success, despite going against the conventional business mantra that says you can’t have a successful business without an online operation.”

Increasingly Attractive To Brands

We have seen the discounters – Aldi and Lidl – reposition themselves with great success in the Irish market, moving from being viewed as the low-cost proposition to being both the great value and great quality proposition for Irish consumers.

Will this successful repositioning make it difficult for Dealz to further increase its share of the FMCG market in Ireland? “No – we have competed alongside Aldi and Lidl for years and continued to grow,” he says.

“They have done a great job in the Irish market, but we are now in the same place as Aldi and Lidl and we offer the same quality proposition. In addition, our Lyons Tea and Kinder products, for example, are the same as those on sale in SuperValu and Tesco," he said.

"The only difference is that they are more competitively priced. We are very strong in terms of our brand offering in the FMCG space and that will continue to evolve. We service seven million customers a week in Ireland and the UK so, as we grow in the market, we become much more attractive to brands.”

Indeed, they aren’t the only discount retailers that are proving their attractiveness to brands. Nielsen’s State of the Nation figures, released during the summer, show how discounters are capturing market growth.

While the multiples experienced flat growth and the convenience sector recorded growth of 1.4%, the discounters are growing by 5%.

What is particularly interesting in the Nielsen figures is the fact that 78% of market growth is driven by brands in discounters, with 70% of shoppers perceiving that discounters offer the lowest prices. Brands have gained 3% value share in discounters and branded items are, on average, 8% cheaper in discounters than in supermarkets.

“We sell all of the main brands in every FMCG category and we are selling around three of the leading brands in each category,” says Williams. “There are few leading FMCG brands that aren’t on sale in our stores.

I started my career in retail in a QuikSave store, which was the original discounter in the UK, and Lidl and Aldi were virtually all private label.

Now that they have become so successful, the brands have increasingly placed their products in their stores.

It comes back to my point that discount and online are the growth channels, and retailers outside of those channels, i.e. a lot of independent stores and some of the multiples, are the ones that will struggle to achieve growth, particularly in a post-Brexit business environment.”

© 2019 Checkout – your source for the latest Irish retail news. Article by Maev Martin. Click subscribe to sign up for the Checkout print edition.

Stay Connected With Our Weekly Newsletter

Processing your request...

Thanks! please check your email to confirm your subscription.