A young Sweden entrepreneur Ingvar Kamprad founded IKEA in 1943. With the age of 17, Kamprad turned his business into a mail order operation selling a variety of household products, particularly furniture. Kamprad with his strong entrepreneurship started the first IKEA showroom/store in 1953 in Sweden.
IKEA main strategy was to design functional furniture that was easy and inexpensive to build, receive it disassembled at stores, and display it on the show room floor with detailed explanation ticket to abolish traditional salesperson assistance. Staffs were available for enquiries, but the customers could freely select between orders, pick up, transport and assemble their own selections. In fact, this strategy creates a mutual beneficial between Ikea and customer. Ikea contributed the savings from self-service practice to offer cheaper price to the customer (Inter IKEA Systems B.V., 2013).
The IKEA vision encompassed Kamprad’s desires to integrate social value into business practice. The company believes what is good for the customer will bring back prosperity for IKEA in the long run. Thus, the vision of the company is offering well-designed furniture; at lower price that majority of people can afford it. Now, IKEA is a world renowned furnishing company reputed for selling Scandinavian-style furniture and other home-based goods. The company has 315 stores, with operations carried out in over 27 countries with well over 135 000 employees (Ikea, 2014). The stores themselves can host 716 million shoppers per year (Ikea, 2014).
For years, committed workforce has been one of the main strengths of Ikea through its Innovative human management practice. Duncan (2001) asserte...
... middle of paper ...
...ractice is one of the factors contributed to the unique culture of IKEA. Also, the unique values such as the cost consciousness had lead to the success of IKEA up to today. This culture apparently created competitive advantage for IKEA to compete in the competitive furnishing market. Last but not least, the author would suggests IKEA to adapt its culture of constant renewal which mean constant accepting new idea but remain its primary value of cost consciousness in order to continue its success as the leader in the industry.
Edvardsson, B., Enquist, B. & Hay, M. (2006). Values-based service brands: narratives from IKEA. Managing Service Quality: An International Journal, 16 (3), 230-246. Doi: http://dx.doi.org/10.1108/09604520610663471
Reynolds, J. (1988). IKEA. Retail and Distribution Management, 16(3), 32-34. Doi: http://dx.doi.org/10.1108/eb018374
Need Writing Help?
Get feedback on grammar, clarity, concision and logic instantly.Check your paper »
- The IKEA distribution chain uses a business model that involves exclusive outsourcing for product manufacture. Due to this type of sourcing, the fact of the matter is that IKEA itself does not involve in manufacturing or production but instead relies exclusively on contractors. This means that they have only limited control of how such facilities operate and generate product. As a result of the above strategy, IKEA had recently come under fire through media and public awareness campaigns for employing Child Labor in countries like India, Pakistan and Nepal by their suppliers (One in Specific, Rangan Exports).... [tags: Term, Employment, IKEA Catalogue, IKEA]
1335 words (3.8 pages)
- As I walked around IKEA, I examined the different products and the prices that came along with them. Everything is very reasonably priced and relatively affordable for the average customer. Throughout my experience in IKEA, I was very confused on why and how their prices are so low but thankfully, at the end of this adventure, I found a sign on the wall by the exit that explained exactly this. This sign explained how the IKEA designers find clever ways to create high quality furniture that people can afford.... [tags: Explanation, Idea, IKEA]
1265 words (3.6 pages)
- The accompanying is an examination of the IKEA case study. This study examines the methodologies utilized by IKEA to increase upper hand in business sectors outside its unique territory. The report starts by giving a background into IKEA. The case study goes into educating the three issues identified with delivery warehousing and transportation of the products from the processing plant to the retail outlets. Some of the business strategies used by IKEA are as per the following: • Cost Savings in Furniture Design IKEA outlines one of kind items that bring about low assembling costs while meeting strict necessities for capacity, proficient distribution, quality, and effect on nature.... [tags: IKEA, Ingvar Kamprad, Furniture, Småland]
1849 words (5.3 pages)
- Introduction IKEA is a multinational company that sells furnishings and furniture. It is founded in 1943 in Sweden by Ingvar Kamprad. The company focused on furniture retailing at the early stage of the business and started to design its own product in 1955. The first IKEA store was opened in Almhult (Sweden) in 1958 (Woodham, 2004). The company has experienced growth ever since, by 2016 IKEA had 390 stores in 48 countries (IKEA, 2016). Since the company was founded its pricing strategy has mainly been low cost.... [tags: Management, Strategic management, IKEA]
1114 words (3.2 pages)
- IKEA was found by Ingvar Kamprad from a small mail-order company to the world’s largest furniture retailer. He adhered the vision of “creating a better life for the many people” and the strategy of cost-leadership at all time. Kamprad kept the lowest price with great design for consumers by cutting cost in daily management, like their self-assembled furniture, which can save transport and storage costs. Also, IKEA used international outsourcing to focus more on customers’ service, such as playroom for children, a low-priced restaurant, and a “Sweden Shop” for groceries to attract market.... [tags: Ingvar Kamprad, IKEA, Älmhult Municipality]
999 words (2.9 pages)
- Case Study 6.1 Kishan solanki University of the Potomac BUS510 Strategic Management 07/17/2016 Professor Petya Nikolova Abstract This case study is the analysis of IKEA, It is a multinational group of companies that designs and sells ready-to-assemble furniture (such as beds, chairs and desks), appliances and home accessories. As of January 2008, it is the world 's largest furniture retailer. Founded in Sweden in 1943 by then-17-year-old Ingvar Kamprad, who was listed as one of the world 's richest people in 2013, Since its 1943 founding in Sweden, IKEA has offered home furnishings and accessories of good design and function at low prices... [tags: Marketing, IKEA, Ingvar Kamprad]
1099 words (3.1 pages)
- IKEA is one of the greatest furniture organizations, on the planet. The organization is the biggest organization on the planet; it had an incredible group of partners. The organization 's development from 1954 was zero, in 1994 of 114 organizations. The author of the IKEA Company, Ingvar Kamprad puts stock in an extraordinary group. As indicated by Bartlett, Dessain And Sjoman, 2006 pg., Ingvar Kamprad established the name IKEA from "his initials (Ingvar Kamprad), his home homestead (Elmtaryd), and its ward (Agunnaryd).... [tags: Ingvar Kamprad, IKEA]
1592 words (4.5 pages)
- 1.Discuss two examples of how teachers can support children from diverse backgrounds in the outdoor classroom environment Teachers can support children diverse background by providing children with music during outdoor classroom time. Music comes in different styles. Furthermore, you can choose music for all different backgrounds. For instance, one day a teacher can play Fiesta which represent Mexican background. “Music enables us to reflect, record, and nurture awareness, understanding, and appreciation of cultural and ethnic diversity while providing knowledge, skills, and understanding of ourselves, our community, and the world” (education.com).... [tags: music, children, backgrounds]
529 words (1.5 pages)
- Brand is something to be created by deep understanding of culture, traditions, fashion updates, trend in market and demand in market. An organization or firm, which fulfills the requirements of all the qualities of the market by using branding strategies, will stand first and will have good name in the society. IKEA will stand as a good example, as it fills all the requirements of a perfect retail brand strategy. Ethical branding and ethical market make the brand famous and increases the reputation of the company brand choices are done by keeping various specifications in mind and there are traditional large scale retailers or modern apparels producers, all of them contribute to the growt... [tags: IKEA Case Study]
1800 words (5.1 pages)
- IKEA still operates under the same vision and business idea: “To create a better everyday life for the many people. Our business idea is to offer a wide range of well-designed, functional home furnishing products at prices so low that as many people as possible will be able to afford them” (IKEA, 2014). Currently, they are focusing on sustainable growth through three growth areas: quality products at low prices, having a positive impact on both people and the planet, and personal growth of their employees (IKEA, 2014).... [tags: Case Study]
1024 words (2.9 pages)