Ikea and Child Labor

Ikea’s main key component of its business strategy is to offer the lowest possible prices for its products. This is done by getting rid of unnecessary expenses all throughout the process of manufacturing its products to selling the products in its stores. Ikea doesn’t hire nearly as many in store workers as similar stores do like Bed, Bath, and Beyond or more technology oriented stores like Circuit City or Best Buy. Its stores are not eloquently furnished. The warehouse concept created by Ikea takes out a lot of costs that other stores would have. While you have to generally help yourself out by walking around different sections of the store, you don’t have to pay more for the product you are buying because Ikea doesn’t have to pay many workers. In order to avert the negatives of the warehouse style of its stores, Ikea tries to show many small areas as display rooms to advertise its products. This way customers can look at a certain area and decide what they want in that set up of a room rather than getting help from a person. Because Ikea tries to cut costs in every aspect of its business model, child labor is an issue the company faces. Ikea outsources the manufacturing of its products in areas of the world where it cheapest to make those respective products. While this is a good thing for the company in respect to cutting costs, child labor is often used in the manufacturing of cheaper products. When Ikea looks for companies to oursource its manufacturing to, Ikea must make sure that the companies making their products are ethical and moral. If Ikea was to support companies that used child labor to make their products, the public would not want to support Ikea when finding out that Ikea products were made using child labor. The key problem faced by Ikea in trying to monitor potential child labor use in the manufacture of its carpets was to find a third party company with extensive experience in providing external monitoring of other companies. Ikea