IKEA: Competitive Furniture
MAR 4803, Section 6/7
Professor J. Ritter
April 10, 2013
When asking many young adults where they purchased their stylish yet affordable furniture, many often respond, “IKEA.” In 1943, at only 17 years of age, Ingvar Kamprad founded an “iconic brand” that is known today as “the world’s largest home furnishings retailer,” IKEA. “The name IKEA is a combination of Kamprad’s initials (IK) and the first letters of the farm (Elmtaryd) and village (Agunnaryd) in southern Sweden where he grew up.” Overcoming challenges, conquering obstacles, planning for the future, and facing competition, IKEA continues to aim high, and achieve results. (Ferrell & Hartline 2011 pg.491)
Stitching INGKA Foundation has owned the company since 1982. (Ferrell & Hartline 2011 pg.492) This charity is known as “one of the world’s wealthiest charities.” Worth an estimated amount of $36 million, it’s no wonder as to how the IKEA Group continues to achieve results. The ownership of the company is described as “the foundation is a nonprofit organization designed to promote innovation in architectural and interior design.” Known as Sweden’s “best-known export,” in 2009 the company reported sales over $32 billion dollars and “an annual growth rate of 7 percent.” An estimated 80 percent of IKEA’s sales come from Europe, followed by North America, Asia and Australia. (Ferrell & Hartline 2011 pg.492)
Much of IKEA’s success is due to their vision statement, otherwise known as “The IKEA Concept.” To fulfill their vision, the company provides “stylish, functional, low-cost home furnishings, that customers must assemble themselves.” Since the customers put their furniture together on their own, IKEA alleviates the shopper’s worries by offering “in-store child-care…pens, pencils paper, tape measures, store guides, catalogs, strollers and shopping bags.” (Ferrell...