Swedish super store may set up shop here if the cap fits

A GOVERNMENT review into the size limits imposed on large hardware and household stores could pave the way for Swedish retailer IKEA’s entry into the Irish market.

Environment Minister Martin Cullen yesterday announced a limited review of the retail planning guidelines which will focus on the cap on floor space imposed on large retail outlets. However, the review, which invites public consultation, will not include grocery stores or supermarket retailers and will instead focus on non-grocery shops such as household and hardware providers.

The planning guidelines, introduced in January 2001, limit the size of large-scale shopping units to 6,000 square metres.

Several chains, including IKEA and German discount grocery retailer Lidl, have been anxious to have the limit scrapped. IKEA, in particular, had recently entered negotiations with the Government, saying it was anxious to do business here.

Concerns that IKEA could opt for a location in the North is believed to be a factor behind the decision to review planning guidelines. If the company was to move into the Irish market, significant job-generation and investment would follow. An IKEA store due to open in Cardiff later this year will create up to 500 jobs.

Responding to yesterday’s announcement, a London IKEA spokeswoman said the company would submit views to the Department of the Environment as part of the review’s consultation process.

“IKEA remain enthusiastic about the Irish market and continues to monitor developments in the whole of Ireland that can accommodate our scale of operation, which is typically 28,000 square metres,” she said.

The Irish grocers’ federation RGDATA welcomed the exclusion of the grocery sector from the review. Director general Ailish Forde said the review was a welcome development.

Mr Cullen said the size limits were being reviewed to ensure effective competition and to take account of ongoing developments in the retail sector.

“While I am generally satisfied that the guidelines are operating satisfactorily, concerns have been expressed about the impact of the cap on retail warehouse competition. The impact of the National Spacial Strategy on the guidelines as well as the need to ensure a full range of retail facilities to encourage competition and investment would be considered by the review,” he added.