Ikea is looking for around 70,000 sq. ft. space in various malls in the New Delhi region to open its smaller city-centre format store
New Delhi: Ikea, the world’s largest furniture and homeware retailer, is aggressively scouting for space in various malls in the National Capital Region (NCR) to open its smaller format stores there, three people familiar with the development said.[bs_input_restrict]
“Ikea is working hard to finalize locations in the NCR,” said one of them asking not to be named. “So far they have not finalized anything.”
The person said Ikea is also looking to put together its logistics and warehousing supply chain to feed the upcoming stores in the NCR.
A couple of mall operators in NCR said Ikea is looking for around 70,000-100,000 sq. ft. space in various malls in the New Delhi region to open its smaller city-centre format, a new concept store the Swedish retailer has been rolling out in global cities in recent years. This is in addition to its large warehouse-size stores sprawling over 400,000-500,000 sq. ft.
“Ikea has ambitious plans for Delhi, the largest home furnishings market in India,” an Ikea India spokesperson said in an emailed response. “Over the years Ikea has developed different store concepts to help us reach the many in an omnichannel way.”
A senior executive of a prominent mall in NCR said his company wasn’t too keen to have Ikea as a tenant.
“The traffic generated by Ikea cannot be part of a premium mall. The experience of the mall gets diluted. Giving them such a huge space, they also required specific heights, they require a ground floor excess and the infra they require is not feasible for a mall to provide,” said the executive asking not to be name. “They have trucks coming thorough the day, loading is happening full day.”
Currently, Ikea operates large format outlets in India in the range of 400,000-500,000 sq. ft. in Hyderabad, Mumbai and Bengaluru.
In 2021, Ikea opened its first smaller format store spreading around 80,000 sq. ft. store at Worli in Mumbai. Then last year, Ikea rolled out its second city-centre format outlet in Mumbai. The 72,000 sq. ft. store located at R City Mall in Ghatkopar was Ikea’s first store in a mall in India.
Ikea is known for its mammoth stores worldwide. However, over the years, the company also decided to introduce a compact format in city centres in various world cities due to changing consumer behaviour amid an explosion of digitally savvy younger population who are increasingly shopping online. Through the smaller stores, Ikea also helps customers with its expertise on how to furnish their homes.
The world’s largest furniture retailer was – as per its 2013 investment proposal – planning to open 25 big box stores in India in the next 15 years. Now, Ikea will develop a mix of both large and smaller format stores, here. After Mumbai, the Swedish giant is planning to open smaller stores in NCR and then Bengaluru.
In a separate development, IndiaRetailing in January reported that the Ingka Group, the parent company of Ikea, had started the process to construct a retail destination or Ingka Centre in Noida that will be home to a large Ikea store as well as other brands from outside of the group’s stable. Read more about it here.
In November 2021, Ingka Centres, which builds retail destinations or malls in various countries, acquired the 47,833 square meter plot in Noida. Ingka had previously said the group will spend around Rs 5,500 crore towards developing the Noida centre.
Multi-storey Ingka Centres generally house an Ikea store as the anchor with other retailers like H&M as tenants. Ingka is also developing a mall in Gurugram. The Gurugram plot was purchased before the Noida land. Ikea generally takes three years to fully develop its malls and stores in India.
“So far, we have planned two large stores (250,000 sq ft upwards) together with Ingka Centers in Gurugram and Noida. We are exploring more opportunities to become more accessible both through physical touchpoints and online. We are also exploring how to speed up logistical capabilities in the north,” the Ikea spokesperson said.
The Netherland-based group has developed dozens of Ingka Centres in Europe, the US, the UK, and China. As per its website, the group operates nine Ingka Centres in China and seven such shopping centres in Sweden, the home market for the parent company Ingka Group.
Ingka Group had previously announced that it would invest Rs 7,500 crores to develop two Ingka Centres in NCR.[/bs_input_restrict]
