Ikea Strategic Position
Strategic Management 1 | Assignment 2 | The purpose of this paper is to conduct a position analysis of the IKEA Corporation. It presents a profile of the company operations, identifies its strategic issues and challenges and analyses strategies which it has contributed to it gaining a competitive advantage. | | WORD COUNT: 3139 STUDENT ID | 8/26/2011 | |
INTRODUCTION
IKEA is a privately held, international home products company that designs and sells ready-to-assemble furniture such as beds and desks, appliances and home accessories. The company which is the world's largest furniture retailer originated in Småland, Sweden and distributes its products through its retail outlets.( IKEA, 2007; Sloan, 2007) As of October 2010, the chain has 313 stores in 38 countries, most of them in Europe, North America, Asia and Australia. The IKEA Group itself owns 276 stores in 25 countries and the other 37 stores are owned and run by franchisees outside the IKEA Group in 16 countries/territories. 2006 saw the opening of 16 new stores. A total of at least 15 openings or relocations were planned for 2010.
IKEA built and designed its own furniture through Swedwood, an IKEA industrial group, where they also started testing the idea of flat packages. The idea was to design products that could be packed completely flat and later reassembled by the customer. Staying true to its motto of providing “Affordable Solutions for a Better Living,” their consumer-assembled furniture allows them to decrease assembly and shipping costs because of the simplicity in packaging parts of unassembled furniture. Bartlett, C. A., and Ghoshal, S. (1989).
By developing a new paradigm for furniture and house wares, IKEA continues to lead the way in home furnishings with much room for improvements and expansions. (See SWOT analysis Appendix i)
ENVIRONMENT ANALYSIS
Political – The Political factors that IKEA has to contend with would include the various
INTRODUCTION
IKEA is a privately held, international home products company that designs and sells ready-to-assemble furniture such as beds and desks, appliances and home accessories. The company which is the world's largest furniture retailer originated in Småland, Sweden and distributes its products through its retail outlets.( IKEA, 2007; Sloan, 2007) As of October 2010, the chain has 313 stores in 38 countries, most of them in Europe, North America, Asia and Australia. The IKEA Group itself owns 276 stores in 25 countries and the other 37 stores are owned and run by franchisees outside the IKEA Group in 16 countries/territories. 2006 saw the opening of 16 new stores. A total of at least 15 openings or relocations were planned for 2010.
IKEA built and designed its own furniture through Swedwood, an IKEA industrial group, where they also started testing the idea of flat packages. The idea was to design products that could be packed completely flat and later reassembled by the customer. Staying true to its motto of providing “Affordable Solutions for a Better Living,” their consumer-assembled furniture allows them to decrease assembly and shipping costs because of the simplicity in packaging parts of unassembled furniture. Bartlett, C. A., and Ghoshal, S. (1989).
By developing a new paradigm for furniture and house wares, IKEA continues to lead the way in home furnishings with much room for improvements and expansions. (See SWOT analysis Appendix i)
ENVIRONMENT ANALYSIS
Political – The Political factors that IKEA has to contend with would include the various
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