Ikea Case
Company History * Established by Ingvar Kamprad in 1943 at the age of seventeen. * The name IKEA was derived from the combination of first letters of CEO name (Ingvar Kamprad), followed by the first letters of the farm and village he grew in (Elmtaryd and Agunnaryd). * Originally sold pens, binders, watches, wallets, cigarette lighters and expanded into furniture, kitchen and other products. * Small backyard company soon developed in to one of the world’s largest furniture retailers. * Currently have 340 stores in 38 countries with €28 billion in 2012. * Donated $82 million in 2012 to fund children’s programs.
IKEA Vision * The Ikea worked with vision "To create a better everyday life for the many people.” * The business idea is "to offer a wide range of well-designed functional home furnishing products at low prices so that many people could afford to purchase them.”
IKEA Strategy * The majority of IKEA's furniture is flat-pack, ready to be assembled by the consumer. This allows a reduction in costs, packaging & transportation. * Offering products at low prices is key to IKEA furniture retailing business model. * Configure the interior of the stores so that customers have to pass through each department to get maximum exposure to the products. * Introduce eye-catching products and have a wide range in room settings and self-service areas to inspire and attract customers with ideas, hints and tips for smart new home furnishing solutions. * Company organized “anti-bureaucrat week” every year, requiring all managers to spend time working in stores to establish relations with front-line and the customers. * Company always focused on low cost which was made as part of management culture.
Supplier relationship: * IKEA adopted a procurement principle that it shouldn’t own production but should develop a close tie with suppliers and support them for long-term relationship. * IKEA provided
IKEA Vision * The Ikea worked with vision "To create a better everyday life for the many people.” * The business idea is "to offer a wide range of well-designed functional home furnishing products at low prices so that many people could afford to purchase them.”
IKEA Strategy * The majority of IKEA's furniture is flat-pack, ready to be assembled by the consumer. This allows a reduction in costs, packaging & transportation. * Offering products at low prices is key to IKEA furniture retailing business model. * Configure the interior of the stores so that customers have to pass through each department to get maximum exposure to the products. * Introduce eye-catching products and have a wide range in room settings and self-service areas to inspire and attract customers with ideas, hints and tips for smart new home furnishing solutions. * Company organized “anti-bureaucrat week” every year, requiring all managers to spend time working in stores to establish relations with front-line and the customers. * Company always focused on low cost which was made as part of management culture.
Supplier relationship: * IKEA adopted a procurement principle that it shouldn’t own production but should develop a close tie with suppliers and support them for long-term relationship. * IKEA provided