Dell poleaxes us!

* Sorry about the lack of posts in recent days. We had a new exam system in the school over Christmas which seems to have increased the scale of corrections substantially - for me at least! But leavonomists, rest assured, normal service resumes from today. *

Well, this week brought us one of the worst pieces of news since the recession hit when Dell in Limerick announced 1900 job losses over the next 12 months. The manufacturing plant is moving to Poland. 450 people will lose their jobs by the end of April, with the remainder gone by next Christmas. About 1,000 high-value jobs will remain in Limerick, but for the workers who were losing their jobs, the decision was final and would not be reversed.

The job losses are a huge blow for the mid-west region, but the knock-on effects may be far worse. Dell confirmed that 1,500 jobs in other locally based companies supplying it would be directly affected by the downsizing. Local business leaders have estimated that as many as 5,000 people could lose their jobs by the end of the year, as the shockwave from the announcement hit the city. With unemployment rates in Limerick among the highest in the country, and jobs going by the day across a range of industries, the chances of re-employment for many are slim, at best. In all, the events of this week are yet another reminder that the country's largest employers no matter what sector they're in - Waterford Crystal, Tara Mines and now Dell - are vulnerable to the vicissitudes of a wildly turbulent global economy.

The Tayto man goes abroad

In the Largo Foods HQ, outside Ashbourne, Co Meath, boxes of crisps are waiting for dispatch to places such as Italy and California - all orders received online by Largo, the snack company headed by Ray Coyle which bought the Tayto brand from C&C back in 2006 for €62m. The orders don't have any significant impact on overall sales numbers, but do serve as a reminder that for Largo's business to grow, Mr Coyle and his team have to look outside Ireland, where Tayto's decades-long dominance has been eroded by Pepsico's Walkers crisps and Procter & Gamble's Pringles (although a UK court ruled this year that Pringles are not crisps due to their lower, 42% potato content -- a decision that will save P&G millions of euro a year in tax).

Tayto did not adequately or rapidly respond to the threat from Walkers, which today has a 26% share of the Irish crisp market. The Largo group has a 47% share of the Irish crisp and snack market, with Tayto accounting for 28% of the crisp market, and King 11%. Largo's home-grown brands, including Hunky Dorys, do reasonably well with a 13% share of the crisp market, but it's Tayto that is so far demonstrating it could have the legs to travel much further afield than Europe.

Source: The Irish Independent