The State's smallest, and smartest, department store made its debut yesterday when Louise Kennedy opened her new premises in Dublin.

The Tipperary-born designer has spent the past two years refurbishing a listed early 19th century house on Merrion Square as her headquarters. In addition to serving as her home and design studio, the 4,300 sq ft building will also operate as a retail outlet offering Ms Kennedy's clothing and a variety of other goods. Her arrival in Merrion Square comes just as the contents of the late Sybil Connolly's premises a few doors away are due to be auctioned.

The main room on the ground floor of the Kennedy building has been turned into what is described as a "lifestyle salon" offering interior accessories, books, objets d'art and gifts from a diverse range of English and Irish designers including David Linley and Louise Bradley. From next spring, the range of glassware being created by Ms Kennedy for Tipperary Crystal will also be available.

The first-floor rooms showcase both the current Kennedy collection as well as hats, bags and other accessories by such names as Galway-born milliner Philip Treacy, Lulu Guinness and Emily-Jo Gibbs. Louise Kennedy's latest enterprise is in line with a global trend towards smaller, more intimate retailing. She cites a number of other examples in Europe such as English designer Paul Smith's recently-opened mini-department store in London's Notting Hill and Colette on the Rue St Honore in Paris. A significant part of her business in Merrion Square, she believes, will come from overseas visitors "looking for a different shopping experience as, increasingly, department stores around the world are homogenising and showing fewer points of difference".

Irish customers, says Ms Kennedy, "will appreciate the unique attention and quality of service that only a salon-style store can offer". She stresses that her Merrion Square outlet will be complementary to, rather than in competition with, Irish retailers already carrying her clothes.