It’s a tale of how a cheetah curbed its pace to conquer a new terrain. When in 2018 IKEA launched its first large format store in Hyderabad, it was an exciting time. The global giant entered the lives of world travelled Indians to offer them modernist furniture and affordable quality home interior products and solutions.

The brand had taken a big risk, since in India where the streets are dotted with carpenters, handy men and cheap labor, getting homemakers to assemble furniture themselves was a gamble. However, their reputation preceded their arrival. The first store garnered enough hype and interest and IKEA India planned at least 25 stores by 2025 with announcements of various stores opening in multiple cities. The modernist and accessible furniture design of the brand tapped the gap in the Indian market – those who had visited IKEA global stores and wanted the products at home.

Today IKEA India has five outlets – three in Mumbai, one each in Hyderabad and Bengaluru, and has expanded its omnichannel network through a digital-first strategy. It also has an online store in Pune sans a physical store. The city is additionally home to IKEA’s first Distribution Centre (Fulfilment Centre) in India.

The brand plans to open two more such distribution centres in Delhi and Bengaluru in the next few years to ramp up its fulfilment capabilities across the country. Moreover, the company has assembling centres in Hyderabad and Mumbai to assist the end Indian customer.

Susanne Pulverer, CEO and Chief Sustainability Officer, IKEA India had said last year that the expansion was taking “longer than expected but they were committed to India”. The main reasons as highlighted by her were the Covid 19 pandemic and the Russia-Ukraine war, which affected the global economy, impacting supply chains, consumer buying decisions, and IKEA’s learnings.

Sale Sale Sale!

The strategy was altered to focus on metropolitan and Tier I cities such as Mumbai, Bengaluru, Hyderabad and Delhi NCR. IKEA India also became more flexible and began to offer attractive offers to customers. Recently, they slashed their prices across categories, to make home furnishings more affordable and accessible for the Indian market, and it was applicable for both its offline and online formats.

Considering recent unprecedented situations such as the pandemic, rising costs of living, supply chain disruptions, and increased inflation, IKEA India took a step to “restrengthen” its affordability agenda, based on the IKEA’s Life at Home Report 2022.

The company announced lower prices for products across categories including store and organize furniture, storage solutions, living room seating, bedroom furniture, office storage, kitchen accessories, children’s storage, etc. This is a long-term initiative.

The prices of these products were reduced, starting from 16 percent to as much up to 39 percent. This initiative is aligned with IKEA’s omnichannel experience for the consumers as the low prices are also reflected in their food offerings and services.

“At IKEA, we believe that everyone should be able to afford home furnishing products and solutions to be able to create homes they love. We are constantly challenging ourselves to find new ways to keep product costs as low as possible without compromising on design, function, quality, sustainability, health, or safety. Local sourcing, new and innovative solutions, and materials, construction techniques, distribution, and transportation are some of the ways that help IKEA keep a competitive price point. We will continue to invest in creating a positive impact on the society and the economy,” elaborated Pulverer.

Another important area where IKEA India intends to concentrate is sourcing raw materials. According to Pulverer, the company intends to scale up local sourcing to almost 50 percent from the present 30 present. Such a move will help bring down the massive customs duties, and in turn make the products even more affordable and attractive for the end-consumer.

Textile is first, wood furniture the next step. “Textile has been at the core of what we exported out of India, along with plastic and metal products. There are also partners who craft heavy furniture like sofas and mattresses, which are more difficult to transport and import. Therefore, wood-based furniture will require local sourcing, once we find the suitable raw material,” she added.

Sustainability Drive

The Swedish furniture giant is known globally as a sustainable and eco-friendly company. Their recent annual report integrated sustainability and climate reporting throughout the business and provided a transparent account of performance and areas where the company was making progress.

“FY22 has been a great year for us, and India remains one of the important growth markets for the Ingka Group. We are committed to becoming climate positive by 2030, and the performance across the group is moving in the right direction. We are progressing well on our journey towards achieving last-mile EV deliveries by 2025. Our focus is to inspire the many people to live a better life by providing affordable solutions for healthy and sustainable living. We will continue to work towards creating a positive impact on the planet, people, and the economy by unleashing the potential of our Ingka business,” Pulverer said.

Some of the sustainable measures taken by IKEA are that the use of renewable energy, transitioning into zero emission home deliveries, introducing a more plant-based food menu, and offering circular services like ‘buy back and take back’.

Additionally, the company works in partnership with other businesses, industries, society and NGOs to drive a positive impact on people and the planet, including supporting a world where human rights were a reality for all.