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IKEA -- Key Elements
There are many individual reasons that the IKEA business model has been successful. However, most of these reasons seem to center of the concepts of standardization and efficiency. One of the company's primary breakthroughs was the introduction of flat-packaging that has offered consumers value through many different aspects. Flat-packaging is simply more efficient to move products throughout the supply chain and even for the consumer to transport the products home. Consumers can assemble the products themselves as well and do not have to pay for delivery or installation which also creates value.
The self-service concept at IKEA extends further beyond just self-delivery and installation as well. The stores also incorporate self-service with the lack of sales people to try to urge consumers to make purchases. Instead of a sales person trying to pressure consumers to make individual purchases, the IKEA store displays the items and gives the consumer all the information they need to make a purchasing decision. If the consumer decides to purchase an IKEA product then they can also transport and assemble the product themselves which can save them a lot of money. The model of IKEA is to provide a quality product at a comparatively low cost and thus the minimalist design of the products, stores, and shopping experience all fit within that theme.
The standardization of process is also a factor that contributes to this theme and allows efficiencies to be built throughout the entire model. Most of the IKEA stores are identical and positioned in different cities in exactly the same fashion. For example, they are on the outskirts of town with lots of parking. The layout inside the stores is nearly identical as well. The efficiency produced with keeping all of the stores alike allows the company to fine tune operations and create scalable processes that can be integrated throughout the distribution network.
IKEA Company has a global supply chain with sales in over 250 own stores in around 24 countries across the globe and 32 outside franchises in 16 countries. The company's stores are supplied directly from the 1350 suppliers or through 31 distribution centers in over 50 countries. As a result, the firm's supply chain has an international spread comprising of sales and purchases across major regions in the world. Since
The stylishly designed, low cost furniture is appreciated by many customers. Even in the recession, IKEA was still able to maintain sales growth. IKEA has used word-of-mouth as their marketing strategy, and customer loyalty is the major component of IKEA's success. Not every furniture company has the ability or money to develop smartphone apps. However, IKEA is able to increase its sales through e-commerce, which also increases company's accessibility and brand
The company sees tremendous potential in a number of global markets and intends to pursue geographic diversification as the primary means of growth. It is aided by globalization, which has allowed it to also diversify its supply chain. The ability of IKEA to enter and exit markets around the world, both as retailer and purchaser, has been facilitated by globalization. The eradication of trade barriers in particular has allowed
IKEA in the U.S.A. How 'culture' in the U.S. may impact upon IKEA company and brand People at IKEA are well-known for living on a slender means, working hard, and being innovative to maximize the use of limited resources. At IKEA, wasting resources is a grave sin. This has become a characteristic of the entire company. This culture of doing things is at the core of the company's approach of keeping low
IKEA was founded in the 1940s as a home furnishings company and quickly expanded into its current form. The companies mission is to "offer home furnishing products of good function and design at prices much lower than competitors by using simple cost-cutting solutions that do not affect the quality of the products" (Ikea.com, 2011). The company operates on a franchise model. There are IKEA stores in 41 countries around the
IKEA, one of the largest furniture retailers worldwide. This text provides a synopsis of the article and commentary on the company's product strategy and product range. IKEA was established in 1943 in Sweden by Ingvar Kamprad, originally as a mail order business. Five years after inception, Kamprad ventured into the home furnishing business, subsequently opening the first furniture showroom in 1949. At the time, the showroom earned recognition as the