There are worse ways to spend a lazy Saturday than heading to the huge IKEA furniture store. Little ones can be easily left in Småland, a supervised play area, where they can freely explore a maze of flat-pack furniture and second-hand goods. You might also want to stop by a restaurant and try some Swedish meatballs.
Ikea’s cheap products and knack for getting shoppers to take home bags full of decorations they never knew they needed helped it to become the world’s largest retailer, with annual sales of 48 billion euros ($53 billion) last year. It has grown into a furniture company. The company, privately operated through a mysterious network of foundations, controls about 9% of the fragmented global furniture market. To continue its growth, the company has invested in e-commerce services and added new store formats. A new experiment with used furniture could help make stores bigger and more environmentally friendly.
In recent years, IKEA has worked hard to make purchasing its products more convenient, especially for customers who don’t have a car. Jesper Brodin, boss of INGKA, which owns most of IKEA’s stores, said while it may be fun to wander around the giant stores, many shoppers don’t have a day to spare to buy two folding chairs. says INGKA boss Jesper Brodin, who does not own IKEA’s intellectual property. ). The company was initially slow to introduce online sales, but it has become a priority since the coronavirus pandemic shuttered nearly all IKEA stores. It now accounts for 23% of the total.
IKEA has also been moving its stores closer to its customers. Now, IKEA has a central “planning center” where customers can assemble their dream kitchen, bedroom and bathroom. Small stores located in downtown shopping districts are also popping up in many cities. In July, IKEA invested in a tower under construction at 5th Street in Manhattan. Avenue: A new store is scheduled to open on Oxford Street in central London in the spring, and the company is also acquiring a mall with IKEA as its anchor tenant. In November, it acquired Churchill Square, a major shopping center in Brighton. In England, the store is located on the site once occupied by the bankrupt department store Debenhams.
Both developments are new to IKEA, but by no means new to the industry. Even more novel is the recent announcement of a platform for people to sell used IKEA furniture online. Trials will begin in Oslo and Madrid and run until December, ahead of next year’s global rollout. IKEA customers can already sell their furniture back to the company in their stores, with more than 200,000 customers using the service last year, twice as many as in 2022. The company’s second-hand platform will allow people to get rid of their old furniture. Buy new buyers directly. IKEA provides recommended prices, general photos and product details (including, importantly, assembly instructions). Sellers can add their own photos and choose a price. The buyer collects the furniture.
IKEA products already account for about a third of used furniture sales, Brodin said. The platform will be free to use, at least initially, but IKEA will give sellers a way to encourage return visits to their stores. If you choose IKEA coupons as payment, you will receive a 15% bonus on the sale price.
It has legs.
In addition to increasing sales, this platform should help IKEA achieve another of its goals: becoming more environmentally friendly. Brodin believes sustainability and profitability can go hand in hand. Since 2016, the company has increased its sales by a third, while cutting carbon emissions from its operations by half and carbon emissions from its supply chain by a fifth. Currently, four-fifths of the energy consumed in our stores and factories comes from renewable sources. In Germany, its biggest market outside of Sweden, it operates 23 solar farms and five wind farms (and sells excess power to the grid). By making it easier for people to sell their old furniture, fewer of Billy’s bookshelves end up in the trash and more flat-pack furniture ends up in living rooms.
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