Ikea revamps its stores as e-commerce grows | Money

The Ikea logo is seen on flags outside the Ikea Concept Center, a furniture store and headquarters of Ikea brand owner Inter IKEA, in Delft, the Netherlands, March 16, 2016. – Reuters pic

STOCKHOLM, May 9 – The company that controls most Ikea branches is repurposing its stores to accommodate the boom in online commerce.

Ingka Group announced on Monday that it will invest 3 billion euros (RM14 billion) by the end of 2023 to open new stores and upgrade existing ones.

“The investment will allow us to renovate and repurpose existing stores,” Tolga Oncu, director of retail operations at Ingka Group, which operates more than 400 of the approximately 500 Ikea stores worldwide, told AFP. .

As more businesses shift their focus to online shopping, the company noted in a statement that “our stores remain one of our greatest strengths.”

But Oncu also pointed out that physical stores were being revamped to support online shopping.

He cited the example of a branch in Kuopio, Finland, which was upgraded to support online order shipping.

The expenditure of 3 billion euros by the end of next year marks a step forward for Ingka, which has invested 2.1 billion euros in its new and existing stores between 2019 and 2021.

Significant investments of nearly 1.2 billion euros are planned in London, and Ingka will also continue to invest in markets considered mature, such as Spain and Germany.

Founded and based in Sweden, Ikea belongs to a complex structure of companies and foundations based mainly in the Netherlands, Switzerland and Liechtenstein.

Traditionally, huge Ikea stores have been located in the suburbs or on the outskirts of cities, but the furniture giant began a change in strategy by opening its first city center store in Hamburg in 2014, and a new model with an offer smaller in Paris in 2019. .

It also plans to open new stores in or near city centers, including Nice this week and Stockholm this summer.

The pioneer of kit furniture to be assembled at home was founded by Ingvar Kamprad in 1943, and has become a multinational giant present in around thirty countries.

At the beginning of March, Ikea announced the suspension of its main activities in Russia and Belarus following the Russian invasion of Ukraine.

The move affected nearly 15,000 employees, 17 stores and three production sites as well as 47 suppliers in Russia and 10 in Belarus. “Our activity will remain on hiatus until further notice,” Oncu told AFP. —AFP

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