IKEA comes to India
IKEA is a Swedish-founded multinational group, that designs and sells ready-to-assemble furniture, kitchen appliances and home accessories.It was founded in Sweden in 1943 by then-17-year-old Ingvar Kamprad. He was listed by Forbes in 2015 as one of the ten richest people in the world, worth more than $40 billion.
IKEA India, part of the IKEA Group, has been present in India for 30 years, sourcing many different products for IKEA stores worldwide.The company has sourced products for approximately € 315 million every year.They aim to double this number in the next few years to meet their global and Indian needs.
IKEA opened its first store in India on Thursday, kicking off its retail journey five years after it received approval to invest in the country's single-brand retail sector.
The company, which has employed 950 people directly and another 1,500 indirectly at its store here, plans to hire 15,000 in the coming years as it expands operations in India.The store here is the first of 25 such outlets planned to be set up in India by 2025.So far, IKEA has spent half the Rs 105 billion earmarked for investment in the country.
IKEA will set some prices even lower in India than elsewhere, as it wants to attract cost-conscious Indian middle class customers. The company’s competitors in India are startups like Pepperfry and Urban Ladder. The overall market, however, is dominated by a multitude of vendors selling ready-made or made-to-order furniture.
Our assessment is that IKEA is pushing into Asia as growth slows in Europe and North America. We feel that IKEA has the task of winning over customer taste in India, as the concept of do-it-yourself interior goods is a novel concept to Indians.