It’s no secret that retailers have taken a hit this year. In 2020, Macy’s, Bed Bath & Beyond, Bath & Body Works, and Tuesday Morning all announced store closures across the country. Not to mention, Pier 1 Imports announced all its stores would be closing for good. Despite the “retail apocalypse” as its been deemed, there is one retailer that is doing pretty well: IKEA.
According to the Financial Times, the Swedish furniture giant and its franchisees will be opening 50 new stores around the world. Many of these new locations will be smaller, or based in the heart of cities (like its New York City Planning Studio), as the retailer strives to move away from its traditional out-of-town warehouse format. IKEA will also be experimenting with implementing kitchen planning studios and offering services such as delivery, furniture assembly, and furniture rental.
Now you’re probably wondering: What led IKEA to thrive as many other retailers struggled? Well, all those home projects you started while self-isolating this year definitely played a role. During IKEA’s 2020 financial year, which ran from September 1, 2019 to August 31, 2020, online sales increased 45%, Inter IKEA Group CEO Jon Abrahamsson Ring said in a press release. The retailer’s e-commerce operations also expanded into three new markets, including China, and the site welcomed a record-breaking four billion visitors.
While overall revenue dropped 4% compared to last year this was a “better result than company bosses had expected at the height of the global lockdown,” according to BBC News. Jesper Brodin, boss of Ingka Group, a franchise company that operates the majority of IKEA stores, told the outlet that when stores did reopen for the first time post-lockdown, the retailer expected customers to return to its aisles gradually. However, just the opposite happened. “From day one of opening we have had a tremendous interest in coming back to our stores,” Brodin said.
Ingka Group revealed it will open 30 new stores in the next 12 months, including an IKEA in Hammersmith, London this spring. Details on when the 20 other stores will open have not yet been disclosed. These new stores will join the current 445 already-existing locations.
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