September 21, 2012

Swedish retailer Ikea to expand retail network

Swedish furniture retailer Ikea plans to expand its retail network in some markets that include the US and China.

By admin-demo

Swedish furniture retailer Ikea plans to expand its retail network in some markets that include the US and China.

The move is part of the retailer’s aim to double its retail store count by 2020, reported Wall Street Journal.

Ikea Chief Executive Mikael Ohlsson told the website that the company intends to increase its production in the US, and would also like to find more suppliers that have a strategic fit with Ikea.

The retailer will add over a 100 stores will be added to its approximately 300-strong chain, Ohlsson added.

The drive will require annual investments of about €1.5bn to €2.5bn from 2014, and result in the opening of 20 to 25 stores a year, the company said.

"Every store is an investment of between €60 million and €100 million, and that normally translates into 300, 400 or 500 new jobs," Ohlsson said

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In the fiscal year ended 31 August 2012, revenue increased 7% from a year earlier, driven particularly by growth in emerging markets such as Russia and China.

The Swedish retailer is also looking to triple the rate of expansion in China, and its first South Korea store is expected to open in near future.

The chain also has plans to open its first stores in Croatia and Serbia in 2013, as well as a third warehouse outside Barcelona in December 2012.

Further, Ikea would open 25 stores in India in the coming years with an investment of €1.5bn, following the government’s approval.

"We’re very positive toward the steps taken," Ohlsson added.

The company designs and sells ready-to-assemble furniture such as beds, chairs, desks, appliances and home accessories.

Swedish home furnishing retailer Ikea Group currently operates 325 stores in 40 countries worldwide.