After growth in the past financial year, the largest owner of Ikea furniture stores, the Ingka Group, wants to attract customers with price reductions. Ingka boss Jesper Brodin emphasized on Thursday that the group is currently investing heavily in price reductions. Depending on the market, storage items such as drawers, shelves, wardrobes and kitchen utensils are particularly affected. The most popular Ikea shelf Billy has already become 20 percent cheaper in the 2023 financial year.
The Ingka Group, which owns the most Ikea stores worldwide, increased its sales in the 2023 financial year (at the end of August) by 5.7 percent to 41.7 billion euros. Worldwide, including trademark rights, Ikea sales rose by 6.6 percent to 47.6 billion euros, said Inter Ikea, which also owns the Ikea brand. Jon Abrahamsson, head of Inter Ikea, said the number of products sold had not kept pace with the increase in sales value. As more and more customers ordered more expensive Ikea items online, fewer small household items such as glasses or napkins were purchased.
“When you walk into an Ikea store, there are a lot more impulse purchases,” he said. Management is also hoping for a boost from the trend that, due to inflation, people will spend less money in restaurants in the coming months with many holidays and instead invest in better quality living. Olga Oncu, head of Ikea retail at Ingka Group, said Ikea could benefit from people preferring to celebrate holidays such as Thanksgiving, Christmas and New Year’s at home. “The families who may have celebrated these events on vacation or in restaurants in the past are now celebrating them at home because they feel it is better for them economically.”
According to a study by consulting firm Deloitte, Americans plan to spend less this holiday season. According to this, sales during the peak shopping period in the USA will grow more slowly than they have in five years. The USA is Ingka Group’s second largest market.