The challenges go from rising operational costs to shifting consumer confidence - yet they remain essential to the vitality of towns and cities across the country.
According to Jean McCabe, CEO of Retail Excellence Ireland and advisory board member for NRF 2026: Retail’s Big Show Europe, supporting small and medium-sized businesses must be a national priority.
Rising costs weigh heavily on small businesses
Retailers across Ireland are grappling with increasing financial pressure. Higher labour costs, soaring energy prices and rising fuel expenses are hitting smaller businesses particularly hard. “These retailers are the heart of our towns and cities,” McCabe explains. “Protecting them is essential to maintaining the health and vibrancy of local communities.” At the same time, she warns that new retail developments must be carefully planned to avoid damaging existing high streets. Striking the right balance between expansion and preservation remains critical.
A two-speed consumer economy
Ireland has been highly successful in attracting foreign investment, particularly in technology, pharmaceuticals and high-end manufacturing. Dublin, in particular, hosts the European headquarters of many major international companies. While this investment has boosted overall consumer spending, it has also created disparities. “There are parts of society that are not seeing the benefits,” McCabe notes. “As a result, consumer confidence is not as high as it could be.” This growing gap in purchasing power is influencing retail performance and shaping demand patterns.
McCabe said foreign investment has helped consumer spending but that there is a bifurcation of domestic spending power between affluent and less-affluent consumers. “There are parts of society that are not seeing the benefits of that economy,” she said. “As a result, consumer confidence is not as high as it could be and that is impacting spending.”
Leveraging Ireland’s global appeal
Despite these challenges, Ireland’s retail sector benefits from strong international appeal. Tourism - especially from North America - continues to drive footfall. Global brands are increasingly establishing flagship stores in key locations such as Dublin’s Grafton Street, while local retailers are reinforcing their identity by highlighting Irish provenance. “We’re seeing a strong focus on premium offerings and local sourcing,” says McCabe, pointing to collaborations between grocery retailers and Irish food producers.
Reinventing the in-store experience
Retailers are also adapting their strategies to evolving consumer behaviours. Convenience shopping dominates during weekdays, while weekends are increasingly about experience-led retail.
Creating engaging, family-oriented environments is becoming essential to attracting customers and driving in-store traffic.
McCabe has headed Retail Excellence Ireland for nearly three years and is a retailer herself, having owned the boutique fashion brand Willow, based in Clare on Ireland’s west coast, for more than 20 years. She will be attending NRF 2026: Retail’s Big Show Europe in Paris September 15-17. Make sure you register now.
