Ikea rules out new Ir­ish stores as dig­i­tal grows

Irish Independent - Business Week - - FRONT PAGE - Gavin McLough­lin

IKEA has no plans to open fur­ther stores in Ire­land, de­spite strong growth in sales.

Sales in Ire­land grew 7.4pc in the com­pany’s last fi­nan­cial year to €181.5m.

Ire­land mar­ket man­ager Clau­dia Mar­shall said it is fo­cused on in­vest­ing in its so-called multi-chan­nel ap­proach – ie on­line sales as well as phys­i­cal store sales.

“We have no plans to open ad­di­tional stores in Ire­land at present,” she said.

Ikea has re­cently in­tro­duced on­line shop­ping here and said that helped to boost Ir­ish rev­enues.

Ms Mar­shall said the move to on­line “has been a great suc­cess and has per­formed strongly in its first 10 months in op­er­a­tion, giv­ing cus­tomers all over Ire­land the op­por­tu­nity to shop with Ikea when­ever and wher­ever they want”.

The sales fig­ure cov­ers the year to the end of Au­gust last.

The com­pany also said it had been boosted by in­vest­ment in its two out­lets here – the full-sized store in Bal­ly­mun and its or­der and col­lec­tion point in Car­rick­mines, South Dublin.

It said price re­duc­tions and the hot sum­mer had also helped.

“Ikea’s sea­sonal sales saw a bumper boost and, as a re­sult, out­door fur­ni­ture was the big­gest area of growth in Ikea Ire­land this year, with a to­tal sales in­crease of 29pc,” the com­pany said.

The Swedish chain has en­joyed decades of rapid growth as shop­pers flocked to its out-of-town ware­houses to pick up cheap fur­ni­ture to as­sem­ble at home.

But with the rise of on­line ri­vals such as Ama­zon, along­side signs of wan­ing con­sumer en­thu­si­asm for DIY home im­prove­ments, Ikea is now in­vest­ing in ecom­merce, city-cen­tre show­rooms and more home de­liv­ery and assem­bly ser­vices.

Bar­bara Martin Cop­pola, chief dig­i­tal of­fi­cer at Ikea Group, the owner of most Ikea stores, said tests un­der­way ranged from con­nect­ing staff with cus­tomers via video to ar­ti­fi­cial in­tel­li­gence tools to help peo­ple fur­nish their homes.

“It’s fan­tas­tic to see hu­man in­ter­ac­tion through tech­nol­ogy when the con­sumer might need help or ad­vice on where to place fur­ni­ture,” she told Reuters last month in an in­ter­view at a new Ikea city-cen­tre store in Madrid ded­i­cated to liv­ing room fur­ni­ture.

Ikea, whose stores are owned by 11 dif­fer­ent fran­chisees, opened 19 new out­lets last year, tak­ing the to­tal to 422 in more than 50 mar­kets.

The largest fran­chisee is Ikea Group, with 367 stores.

The brand, which does most of its sales in Europe, opened its first store in In­dia this year and an­nounced plans to en­ter Latin Amer­ica, start­ing with Chile in 2020 fol­lowed by Colom­bia and Peru.

It said last month that it was also look­ing at en­ter­ing Mex­ico, Es­to­nia, Ukraine, Puerto Rico, Oman, Lux­em­bourg, Ma­cau and the Philip­pines over the com­ing years.

Ad­di­tional re­port­ing Reuters

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