Home Retail IKEA launches first India store in Hyderabad with a ‘low price’ strategy

IKEA launches first India store in Hyderabad with a ‘low price’ strategy

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, the world’s leading Swedish home furnishing retailer will open the doors of its Hyderabad store, its first in India to customers at 10:00 a.m. on Thursday, August 09, 2018.

IKEA launches first India store in Hyderabad with a 'low price' strategy

This is a landmark moment for IKEA after it got FDI approval in 2013 that allowed 100 percent FDI for single brand retailers in India. IKEA has been sourcing from India for its global stores for more than 30 years. Its plan to open retail stores in 40+ cities across the country, reinforces its long-term commitment and deep connection with India. IKEA has set out to become a truly unique, meaningful and trusted brand in India, making everyday brighter and better for the many people and this dream seems closer to reality today as we wait to see what the Hyderabad store will offer.

On the occasion, , CEO, IKEA Group said, “Today is a proud moment as it marks a major milestone in a journey that started more than 30 years ago when IKEA partnered up with local manufactures in India. We have a long-term commitment to India, which is an important market for us. We bring an inspiring, affordable and convenient home furnishing offer and awe are more than ready to meet and understand the needs, frustrations and drams in the everyday lives of our customers in India.”

Expansion Plans

In the next phase of expansion, IKEA will be present in other cities like Ahmedabad, Surat, Pune, Chennai and Kolkata with a multi-channel approach. By 2025, the brand is looking at opening more than 25 touchpoints across various cities.

The brand aims to be present whenever the customers wants by various channels like on-line, smaller touch points and large IKEA stores.

IKEA is looking forward to spend Rs 1,000 crore per store. So far, the brand has spent half of the Rs 10,500 crore that was approved as initial investement in 2013.

IKEA is focussing big on healthy and sustainable living. The brand’ ambition is to provide affordable good quality, value for money and well-designed home furnishings to many people.

IKEA Store Concept

IKEA is looking forward to open all the stores with plot size between 8-11 acres.

The store is 4,00,000 sq. ft. large and is spread over 13 acres in the heart of Hyderabad’s tech hub HITEC City and promises to be a ‘fun day out’ for the family. It will offer 7,500 affordable, good quality, value for money home furnishing products, all under one roof. The store will remain open 365 days from between 10.00 a.m. – 11:00 p.m.

The IKEA store in Hyderabad will offer ideas, inspiration and solutions. It will exhibit two full homes that reflect ‘Life at Home’ in Hyderabad, besides different room sets based on different parts of the home like bedroom, kitchen, children’s room and living room. It will also have a market hall where you will find home kitchen utensils and accessories, textiles, rugs, lighting, decoration, stationary and even live plants.

The store will house a 1,000-seater restaurant, IKEA’s largest and possibly India’s largest restaurant, a cafe which will offer coffee, bakes, frozen yogurt and many more for purchase, a kids’ paly area named Smaland where customers can leave their children safely.

The IKEA restaurant will offer 50 percent Swedish specialities like salmon and chicken and vegetarian meatballs and 50 percent local delicacies like biryani, samosas, dal makhni in the case of Hyderabad. The food will be very affordable, for example a plate of samosas will cost Rs 10.

Low Pricing

IKEA’S business idea is based on ambition of reaching the many people with thin wallets. As it sets a goal to reach 200 million people in the next three years , the foundation for a strong and relevant offer is affordability and accessibility. IKEA will attract the many different segments in society and not just the few. Everyone is welcome to shop at IKEA. 1,000 products will be priced below Rs 200.

, CEO, said, “At IKEA the people, the community and our contribution to safeguarding the health of the planet is the biggest priority. Over the last five years Juvencio Maeztu and the team here have laid a very strong foundation and a solid base for IKEA to be successful. I thank all our friends in India including the government and officials for all the support and partnership to make this dream a reality.”

In terms of the products, the company will be bringing its classic IKEA range along with a small percentage of locally relevant products for the Indian market like masala boxes, pressure cookers, tawas, idli makers, colourful sheets and mattresses made with coconut fibre centre. Customers will also be able to buy global classics like the BILLY bookcase, KLIPPAN sofa, LACK table and POaNG armchair among others.

Welcoming the people of Hyderabad, , IKEA Hyderabad Store Manager said, “I am excited to throw open the doors of the first IKEA India store to the many people of Hyderabad and its neighbouring community. Telangana has given us a lot of love over the last few years and now we hope to witness the people of Hyderabad truly enjoying our store that has been built with love. I thank the local officials who have made this day possible. The biggest value we bring its to the many people who have big aspirations for their homes and thin wallets. Our promise is one of value, of quality and of making the everyday life better at home for all of the many people in the state and beyond.”

Recruitment

The IKEA store employs 950 co-workers in Hyderabad directly and 1500 indirectly in services and expects to host close to 7 million visitors each year.

Each IKEA store in India will have between 800-1,000 co-workers and about 1,500 workers indirectly engaged in services, which makes a total of approximately 2,300 employees per store.

The ambition for IKEA in India is to develop a 50:50 gender diversity, encourage and create unique opportunities for women in society. Towards this, the brand has a non-negotiable commitment to hire 50 percent women co-workers at all levels in India including forklift drives and assembling co-workers. It will also come with a strong and affordable service offer including delivery and assembly to help customers who are not familiar with the DIY (Do it yourself) concept just yet!

Distribution Centre

In India, the furniture retailer has invested Rs 20 crore for 2.7 lakh sq. ft. distribution centre in Pune, on leased land. This distribution centre is in partnership with IndoSpace Industrial Park and going forward, the brand plans to expand this distribution centre to 3.7 lakh sq.ft by next year with an investment of Rs 100 crore.

The brand is also scouting land in Maharashtra to build own warehousing facilities over the next two to three years, and has earmarked an outlay of Rs 750 crore and create direct jobs of approx. 500-600 people along with indirect job creation.

An investment will be done keeping both automation and sustainability in mind where IKEA aims to implement some of the most advanced technology.

Purchasing

IKEA has been sourcing from India for more than 30 years. There are more than 50 suppliers in India and IKEA has long term partnerships with many from past decades.

15 new suppliers have associated with the brand in last two years in new categories besides textiles.

In future, IKEA is looking at exploring new categories like ceramics, glassware, wood, natural fibres, bamboo etc.

For the moment though, its celebrations all the way, bringing home IKEA to Hyderabad!

With inputs from Charu Lamba for Indiaretailing Bureau