It must feel like Christmas time all year round for the Smyth brothers who own Smyths Toys, the Irish toyshop chain that started in Co Mayo. It had a turnover of £27 million last year - and that was before it opened two new stores in Blanchardstown and Bray.

Of course, things were not always that way: according to Padraig Smyth, there was a period when he and his brothers thought of giving the whole thing up and changing direction. That time is now firmly in the past, and the Smyth brothers have expanded their toy empire to include outlets in Tallaght, Jervis Street, Blanchardstown, Cork, Limerick, Galway, their home town Claremorris and, more recently, Bray.

The Smyth family has been in business in Claremorris for as long as anyone can remember. According to Padraig, their parents, Paddy and Bernadette, ran "a typical country newsagents, selling newspapers, cigarettes, a small line of groceries and, of course, toys".

The Claremorris shop, where the dream began some 20 years ago, is now revamped and expanded, to look like all the others nationwide.

Having raised five sons and one daughter, Mr and Mrs Smyth still take an active interest in the family business and work long hours behind the counter in their Claremorris shop. Eldest son and accountant, Anthony, and second son Padraig are the main men behind Smyths Toys, but younger brothers Tommy and Liam are also on the board of directors. Liam divides his time between the now expanded shop in Claremorris and the toy store in Galway.

In tandem with the toy business, the brothers have always been involved in the pub and catering trade. They opened Mulligan's in Claremorris in the early 1980s, before moving to Galway, where Tommy now runs McSwiggans pub and restaurant, which opened in 1985 - on the same day Knock airport was opened. "You could say it took off too," jokes Padraig.

It must be among Ireland's most successful family-run enterprises. Only Joe, a software design engineer and the youngest of the Smyths, and Maura, married with three sons in Claremorris, are not involved in the business.

Getting an interview with one of the Smyth brothers is difficult. "We're doing fine and we like to keep our heads below the parapet," Padraig says. But he is not shy talking about the business he and his brothers have built up. They opened their first toy shop in a basement unit off Eyre Square in Galway in 1986, when Dunnes Stores, Quinnsworth and Roches were all carrying toy lines.

"We reckoned we could do just as good as them, if not better. We were aiming for a year-round business, not just a seasonal one." They moved to a slightly bigger shop on Eglinton Street, just off Shop Street, a year later, but by 1988, they were thinking it had all been a mistake.

"It just wasn't profitable in a small unit and we couldn't find a bigger shop in Galway at that time. We were going to get out of toys altogether, but then we took one last shot when we opened our 6,000 sq ft store, which had been a warehouse in Henry Street in Limerick. That was the turning point.

"It was the first shop which introduced wide aisles and trolleys. Within two days, we knew we had the right formula," he says. In 1990, Smyths Toys returned to Galway where it opened a bigger shop in Woodquay. Expansion was then the priority. The chain's 10,000 sq ft shop opened in Maylor Street, Cork, in 1992, followed by its 20,000 sq ft shop in Tallaght in 1994.

More big shops followed in Jervis Street in 1997, Blanchardstown in 1999 and it opened a 7,000 sq ft shop in Bray last June. More shops are planned for next year.

The company's head office is in Galway. The Smyth boys have an affinity with the city where they went to college, and which gave them their first taste of big business. They moved into their 7,000 sq ft store in the Galway Retail Park in 1994. This property was recently expanded to 14,000 sq ft. It now houses two floors of sheer fantasy for children from one to 91, with aisles of toys, video games, bikes and nursery equipment.

The company does 75 per cent of its business from October to Christmas Eve. Its turnover last year of £27 million was calculated before the Blanchardstown and Bray shops opened. Padraig believes it has no real rivals in the market anymore, although Argos, which recently opened a store in Galway, does command 20 per cent of the British toy market.

"Toys are generally cheaper here than in the UK because the market is tighter. However, inflationary trends mean profit margins are under pressure due to the weakness of the euro against the dollar. Last year, the punt was worth $1.30, this year it was worth $1.10. By cutting out the middleman and buying direct from manufacturers, we have minimised the effect of the weaker currency," he says.

Hard work is at the core of the winning formula: while Christmas for most of us begins in mid-December, it begins on January 10 each year for Padraig Smyth.

"That's when I go to Hong Kong for the first of the world toy fairs. The main buying season for us for the following Christmas is February and March. I go to Hong Kong and London in January, Nuremberg in Germany in February and New York the same month."

The euro means the company is beginning to buy a lot more toys from European suppliers, including a handful of Irish suppliers. "Gosling Games do the excellent Discover Ireland and Discover Europe board games. MB Games has a plant in Waterford which employs 700 people. We buy Monopoly, Pictionary and all the other MB and Waddington games from them." Kestrel, a Donegal-based company, produces slides, swings and other garden toys, while Little Tikes, the American-owned company, had a factory in Finglas supplying children's toys which had to close last year because it could not recruit enough staff.

Staff shortages are a constant problem for most expanding companies, but Padraig says he is lucky in that regard. The company, he says, always had a core of loyal employees who have been there from the very beginning.

Extra staff are taken on at Christmas - mainly students and women working full-time in the home.

"They make excellent employees, especially mothers who want to work part time for us. We are delighted to have them and they get to work the hours that suit them. We are also starting to take on non-nationals and that's working out too," he says.

What is the in toy this Christmas?

Playstation 2, retailing at £379, according to Padraig - but it cannot be got for love or money at the moment. The Who Wants to be a Millionaire craze is also sweeping the country and you have a one in a million chance of getting the electronic board game of the same name in any shop before Christmas. Scooters are also going to be very popular this Christmas.

A consistent favourite in recent years has been Buzz Lightyear. Kids just love Buzz, according to Padraig, and he has outsold all other crazes over the last five years, including the the Ninja Turtles, and more recently, Furbys and Tellytubbies. With the launch of Toy Story 2 on video, he predicts Buzz will be a big hit again this Christmas.