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IKEA International Group

File:Ikea.gif
Company type	Private
Industry	Retail (Specialty)
Founded	1943 in Älmhult, Småland, Sweden
Headquarters	Leiden, South Holland, The Netherlands
Key people	Ingvar Kamprad, Founder Anders Dahlvig, President Hans Gydell, VP
Products	self-assembly furniture, See section on products
Revenue	$15.425B USD ( 24%) (FY 2004)
Number of employees	90,000 (2005)
Website	www.ikea.com

IKEA is an international home furnishings retailer. IKEA is well-known for its unique furniture which consumers are often required to assemble for themselves. The chain is famous for its functional yet stylish products, and has 231 stores in 33 countries; most of them in Europe, the rest in the United States, Canada, Asia and Australia. More than 20 stores opened during 2005. IKEA is one of the few store chains to have locations both in Israel and in other Middle Eastern nations.

IKEA is generally pronounced (IPA /i'ke.a/) but in many English-speaking regions, it is pronounced (IPA /aɪ'ki:ə/) rhyming with the word "idea".

The IKEA catalogue, containing about 12,000 products, is printed in 160 million copies (2006) worldwide, and distributed free of charge.

History

IKEA was founded in Älmhultalso known as hell on earth sweden , Sweden in 1943 by Ingvar Kampradalso lnown as satin , then 17. The company name is a composite of the first letters in his name in addition to the first letters of the names of the property and the village in which he grew up: Ingvar Kamprad Elmtaryd Agunnaryd. This acronym is incidentally similar to the Greek word οικία (home) and to the Finnish word oikea (correct, right).

Originally, IKEA sold pens, wallets, picture frames, table runners, watches, jewelry and nylon stockings or practically anything Kamprad found a need for that he could fill with a product at a reduced price. Furniture was first added to the IKEA product range in 1947 and, in 1955, IKEA began to design its own furniture. The company motto is: "Affordable Solutions for Better Living, if you can find a way to put our shit together".

At first, Kamprad sold his goods out of his home and by mail order then you didnt have to find away out of his damn stores, but eventually a store was opened in the nearby town of Älmhult. It was also the location for the first IKEA "warehouse" store which came to serve as a model for IKEA establishments elsewhere and on March 23, 1963, the first store outside Sweden was opened in Asker, a Norwegian municipality outside Oslo why coudnt stay in scandinavia they are stupid will buy anything over there. (The store was located in the same building which houses the Bellevue hotel, about two km from the present site at Billingstad/Slependen, which opened in 1975. The store in Asker is currently undergoing a major expansion and remodeling.)

Products

IKEA furniture is well known for its modern (often unusual) design. Also, because much of it is self-assembly furniture , it is designed to be assembled by the consumer rather than being sold pre-assembled. IKEA claims this permits them to reduce costs and use of packaging by not shipping air—the volume of a bookcase, for example, is considerably less if it is shipped unassembled rather than assembled but we all know it is cause even they dont know how to put it together.

IKEA also claims to have pioneered the use of more sustainable approaches to mass consumer culture. Its founder calls it "democratic design," meaning that the company applies an integrated approach to manufacturing and design (see also environmental design). Responding to the explosion of human population—and material expectations—in the 20th century, the company has mastered economies of scale,frustrating the hell out of me and everyone els, capturing material streams and creating manufacturing processes that hold costs and resource use down, such as the extensive use of particle board. The intended result is flexible, adaptable home furnishings, scalable both to larger homes and smaller dwellings.

IKEA has also expanded their product base to include flat-pack houses, in an effort to cut prices involved in a first-time buyer's home. The product, named BoKlok was launched in Sweden in 1996 in a joint venture with Skanska. Now working in the Nordic countries and in UK, sites confirmed in England include London, Manchester, Leeds and Liverpool.

Every IKEA product is identified by a name, either Swedish in origin or Swedish-sounding. Most names have an etymology regarding their function or appearance Template:De icon :

• Upholstered furniture, coffee tables, rattan furniture, bookshelves, media storage, doorknobs: Swedish placenames

• Beds, wardrobes, hall furniture: Norwegian placenames

• Dining tables and chairs: Finnish placenames

• Bookcase ranges: Occupations

• Bathroom articles: Scandinavian lakes, rivers and bays

• Kitchens: grammatical terms, sometimes also other names

• Chairs, desks: men’s names

• Materials, curtains: women’s names

• Garden furniture: Swedish islands

• Carpets: Danish placenames

• Lighting: terms from music, chemistry, meteorology, measures, weights, seasons, months, days, boats, sailors’ language

• Bedlinen, bedcovers, pillows/cushions: flowers, plants, precious stones

• Children’s items: mammals, birds, adjectives

• Curtain accessories: mathematical and geometrical terms

• Kitchen utensils: foreign words, spices, herbs, fish, mushrooms, fruits or berries, functional descriptions

• Boxes, wall decoration, pictures and frames, clocks: colloquial expressions, also Swedish placenames

For example, AKTION is a name for a pepper mill, DINERA for tableware, KASSETT for media storage. One range of office furniture is named EFFEKTIV.

Company founder Ingvar Kamprad, who is dyslexic , found that naming the furniture with a name, rather than a product code, made the names easier to remember.

Community impact

IKEA's goals of sustainability and environmental design in their merchandise may be trumped by the impact a new IKEA store can have on a community:

Like all big-box stores, IKEA stores draw consumers from a very large area. Although they were in the U.S. before the United Kingdom and other European countries, IKEA had very few stores in the United States until recently. Because they have few stores, they often drew consumers from out-of-state. The handful of American cities which accepted IKEA stores were delighted by the subsequent surge in sales tax revenue, yet dismayed at the accompanying surge in traffic congestion.

For example, when an IKEA opened in April 2000 in Emeryville, California, the traffic was so severe that most local traffic lights were rendered useless. Emeryville police were forced to manually direct traffic daily for three months. When an IKEA opened in Tempe, Arizona in November 2004, the traffic jams on Interstate 10 were so severe that the Arizona Department of Public Safety had to close the nearest off-ramp to the store just to spread out the traffic among other nearby off-ramps.

IKEA's most popular store in Brent Park, London frequently has traffic jams on the weekends.

A new store opened in Edmonton, North London at midnight on 10 February 2005. It attracted over 6,000 visitors due to huge opening discounts in the first three opening hours and resulted in a number of casualties as people were crushed in the rush to get into the store. The store was closed after only 30 minutes (due to the large number of customers, there were inadequate security staff and police). The store was re-opened at 5pm on 11 February2005 with no additional incident. Two of IKEA's newest stores opened in Adelaide, South Australia and Chiba, Japan.

In Saudi Arabia three people were crushed to death in September 2004 when IKEA offered a limited number of $150 vouchers for free.

Minding the above problems, the store at Atlantic Station in Atlanta opened on 29 June 2005 with 20 off-duty police officers directing traffic. That store is its first in the Southeast U.S., its third-largest in North America, and the only one to serve grits. The first person in line had been there a week.

The Stoughton, Massachusetts store opened on 9 November 2005. Nearby highways were at a standstill; approaching the store from less than 1 mile took upwards of an hour. IKEA employees indicated that on the first Saturday of operation, the Stoughton store would have sales of $1-1.2M. Over 300,000 visitors were expected on the first weekend of operation.

IKEA was vetoed planning permission for a further store in England in 2004 (to be based in Stockport in Greater Manchester) by the Office of the Deputy Prime Minister. It applied for judicial review but lost in 2005. In January 2006 it announced plans to create 10 extra smaller outlets, to be based in city centres. The first of these will be in Coventry.

IKEA's first Michigan store is expected to open June 7th, 2006 in Canton, Michigan

Store format

Newer IKEA stores are usually very large blue boxes with few windows. They are often designed around a "one-way" layout which leads customers along "the natural way", a pathway which provides convenient access to all areas of the store. The sequence involves going through furniture showrooms (showroom) and housewares (market-hall) first, then the warehouse where one collects flatpacks for products seen in the showrooms, and then the cashier.

This design is intended to allow customers to encounter products which they might not have thought to look for, however there are 'shortcuts' marked out within the store to allow quicker access for those who do not wish to browse the large array of goods available.

Whilst the original design involved the warehouse on the lower level and the showroom and markethall on the upper, some stores are single-level bungalow-style stores while many U.S. stores place the showroom upstairs and the marketplace and warehouse both downstairs. This is also true for all German IKEA stores. Some stores operate separate additional warehouses for the larger or less popular flatpacks to keep the size of the customer warehouse down (and therefore less daunting) and allow more stock to be kept on-site at any given time. Unfortunately, this occasionally results in customers being unable to find the goods they paid for at the cashier without direction from staff and the impression of queueing twice (once at the cashier, once at the external warehouse). However, there are few complaints about being able to collect goods quicker from the customer warehouses.

Many stores include restaurants serving typically Swedish food, and beverages such as lingonberry juice. The restaurant area is usually the one place in the store where there are large windows. Outside of Scandinavia, these restaurants are sometimes complemented by mini-shops selling Swedish-made, Swedish-style groceries. As would be expected with IKEA, you can buy IKEA's specialities, such as Swedish meatballs, in parts (i.e. the ingredients) at these stores and assemble it (that is, simple, straightforward food preparation) at home.

Most IKEA stores also offer an "as-is" area at the end of the warehouse just prior to the cashiers. Returned, damaged and formerly showcased products which are not in "as new" condition are displayed here, and sold with a discount, but also with a "no-returns" policy.

In Hong Kong, where shop space is limited and costly, IKEA has opened four outlets across the city, which are actually part of conveniently located shopping malls. They are relatively tiny, compared to common "large blue box" store design, yet most of them are still in the "one-way" layout. However, the newest outlet in Telford Plaza does not follow this template, and the three independent floors can be accessed freely from each. Following IKEA tradition, though, the only cashier is located on the lowest floor.

Corporate structure

Despite IKEA's Swedish roots, the owner/franchiser of the IKEA trademark and concept is a Dutch-registered company, Inter IKEA Systems. The operator/franchisee of the majority of the stores worldwide is a separate entity, the IKEA Group, a private group of companies owned by a Dutch charitable foundation.

Of the 231 IKEA stores in 33 countries, 206 are run by the IKEA Group. The remaining 25 stores are run by franchisees outside of the IKEA Group.

INGKA Holding is the ultimate parent company for all IKEA companies, including the industrial group Swedwood but excluding Inter IKEA Systems. INGKA Holding is wholly owned by the Stichting INGKA Foundation, which is a charitable foundation registered in the Netherlands. In May 2006, the business magazine The Economist reported that the foundation was the world's wealthiest charity with a net worth estimated at exceeding US$36 billion (more than the Bill & Melinda Gates Foundation), although the foundation's purpose is largely corporate tax-avoidance and anti-takeover protection for IKEA .

Criticisms

Some criticisms of IKEA:

• IKEA has demolished historic buildings, in at least one case for a parking lot.
• In the 1990s, there were several complaints arising from IKEA's British television advertising campaigns:
  • “Stop being so English”: In which a “Swedish psychologist” claims the British are uptight due to their taste in “English” furniture. (complaints were dismissed).
  • An advertisement where a management consultant suggests how much more furniture a company could buy, if it fired an office worker. (complaints were dismisssed but IKEA voluntarily withdrew the advert)
  • A campaign under the slogan, "Just pack up, ship out, find a place of your own. And for all your new things, you know where to come. Make a fresh start," got complaints that it was trivializing marriage breakups and showing a homosexual relationship. (complaints were dismissed)
  • An advertisement in which a boss tells members of his staff to smell each other's armpits.
• Misleading statements in unsolicited promotional materials, such as "reasons to visit your IKEA store, today!" followed by advertisements for several heavily discounted items. Small print reveals the discount is valid from a starting date weeks or even months into the future, and expires 48 hours later.
• Difficulty in following the instructions for product assembly, which rely on pictures only.
• Store owner, Ingvar Kamprad was directly involved in pro-Nazi Swedish politics between 1945 and 1948, during the company's infancy. Kamprad admits some details in his book The Ikea Story. This caused tensions when Ikea first brought stores into Israel.

Diversity

IKEA was named one of the 100 Best Companies for Working Mothers in 2004 and 2005 by Working Mothers magazine. It also ranked 96 in Fortune's 100 Best Companies to Work For in 2006.

Design reform

As pointed out by circuit lecturer Will Novosedlik, IKEA embodies the principles of design reform begun by William Morris and John Ruskin. "Socialistic" in nature, IKEA attempts to elevate public taste by providing quality goods at affordable prices.

Popular Culture

• IKEA furniture was parodied in an episode of the US cartoon Futurama where Professor Farnsworth purchases a self-assembly supercollider from πkea (pi-kea), which subsequently explodes. Incidentally, the supercollider is delivered by a robot designed to look like an IKEA TV-stand (who allmost completely falls apart on his way out after delivering the goods.)
• The IKEA furniture line was satirized in the movie Fight Club, as a fictional "Furnï" store featuring generically designed products lacking soul or substance in the greater context of humanity.
• The interiors of the homes in John Woo's film 'The Killer' were furnished completely with IKEA items.
• IKEA furniture is described as "semi-disposable Swedish furniture" in Microserfs by author Douglas Coupland.
• IKEA is featured in a song of the same title by folk/rock singer Jonathan Coulton.
• IKEA furniture was heavily featured throughout the recent Swedish film "The Ketchup Effect".
• IKEA was mentioned in an episode of the US sit-com Friends entitled "The One With All The Poker" in 1995:

Rachel: So basically, you get your ya-yas by taking money from all of your friends. Ross: Yeah. Chandler: Yes, and I get my ya-yas from Ikea. You have to put them together yourself, but they cost a little less.

"(Chandler sits on rich guys couch) Chandler : I-KEA this is comfortable..."

• An IKEA in Stockholm, Sweden was visited on The Amazing Race 6. A Detour was performed there.
• Kanye West mentions buying a bed from IKEA in the song Last Call

"Kanye: I unpacked all my shit. You know, we went to IKEA, I bought a bed, I put the bed together myself. I loaded up all my equipment, and the first beat I made was, uh, 'Heart of the City.' ""

• In the "Eight Misbehavin'" episode of The Simpsons (11th season), the family visits "Shøp", a swedish furniture shop. At the cafeteria, Homer is using a four-forked lego mechanism to eat his swedish meatballs.

IKEA's debut in each country

• 1958 Sweden — Älmhult
• 1963 Norway — Asker (Nesbru)
• 1969 Denmark — Copenhagen (Tåstrup)
• 1973 Switzerland — Zürich (Spreitenbach)
• 1974 Germany — Munich (Eching)
• 1974 Japan — Kobe (joint venture with a Japanese department store, withdrew from the market in 1984 because of stagnant sales)
• 1975 Australia — Sydney (Artarmon)
• 1975 Hong Kong — Kowloon (Tsim Sha Tsui)
• 1976 Canada — Halifax (Burnside Park) (Temporary North American market test store, closed in 1998. It was very successful. First permanant store was built in Richmond, British Columbia later in 1976.)
• 1977 Austria — Vienna (Vösendorf)
• 1978 Netherlands — Rotterdam (Sliedrecht)
• 1978 Singapore — Queenstown
• 1980 Spain — Gran Canaria (Las Palmas)
• 1981 Iceland — Reykjavík
• 1981 France — Paris (Bobigny)
• 1983 Saudi Arabia — Jeddah
• 1984 Belgium — Brussels (Zaventem and Ternat)
• 1984 Kuwait — Kuwait City
• 1985 United States — Philadelphia (Plymouth Meeting)
• 1987 United Kingdom — Manchester (Warrington)
• 1989 Italy — Milan (Cinisello Balsamo)
• 1990 Hungary — Budapest
• 1991 Poland — Warsaw
• 1991 Czech Republic — Prague (Zličín)
• 1991 United Arab Emirates — Dubai
• 1992 Slovakia — Bratislava
• 1994 Taiwan — Taipei
• 1996 Finland — Espoo
• 1996 Malaysia — Selangor (Re-located to Mutiara Damansara in 2003)
• 1998 China — Beijing
• 2000 Russia — Moscow (Chimki)
• 2001 Israel — Netanya
• 2001 Greece — Thessaloniki
• 2004 Portugal — Lisbon
• 2005 Turkey — Istanbul
• 2006 Ireland — Dublin

See also

• List of Swedish companies

Notes

1. IKEA Q&A section, on the Swedish language site ().

External links

• IKEA - Official site
  • How IKEA works
  • IKEA UK website

• IKEA Advertising Campaign
• Positive Fanatics - The Unofficial IKEA Web Journal

• IKEA Fansite FAQ's and Photos primarily focusing on IKEA Kitchens
  • IKEA Fansite Forums
    • Find an IKEA store, get an IKEA Catalog

• Lyrics to Jonathan Coulton's 'IKEA'

• "The miracle of Älmhult" by Oliver Burkeman from the Guardian newspaper. The writer talks about his visit to IKEA's HQ in Älmhurt

Data

• Yahoo! - IKEA International A/S Company Profile
• "IKEA: Flat-pack accounting". The Economist. 2006-05-11.

Directory

• Store addresses and contact details are on Yellowikis/IKEA

• Brands
• Furniture manufacturers
• Companies of the Netherlands
• Dutch multinationals
• 1943 establishments