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DELFT, The Netherlands — Affordability is the watchword for Ikea’s global operations as the company doubles down on efforts to keep prices in line for its shoppers, as outlined in its fiscal year-end report.
“Intensification of internal efforts to reduce material and manufacturing costs led to a decrease in Ikea retail prices at the end of FY23,” said Jon Abrahamsson Ring, CEO of Inter Ikea Group. “In challenging times when inflation is high and many people struggle with the cost of living, the need for home furnishings solutions at affordable prices is high.
“This where we will continue to do what Ikea has always done: putting customers’ affordability first. Looking further ahead, the three main opportunities we see for Ikea are to become even more affordable, more accessible and more sustainable,” said Ring.
Inter Ikea Group, which handles retail concepts, products and supply for the worldwide Ikea franchise, recorded a 6.6% increase in retail sales for its fiscal year ended Aug. 31 based on total sales of EUR 47.6 billion for fiscal 2023 vs. EUR 44.6 billion for the 2022. Total sales include products, food and services sold by the 12 Ikea franchisees worldwide.
The company said that during the fiscal year product availability improved because of closer collaboration with partners across its supply chain to solve logistical constraints, such as those experienced during the pandemic-related supply chain shortages.
Among the achievements Inter Ikea Group cited were its 71 new stores, including many small format or plan-and-order points. Small stores were added in Copenhagen, Madrid, Rome, San Francisco and Toronto, among other locations. It also entered two new markets: South America, with a store in Colombia, and a first-ever site in New Zealand.
Store visitors rose during the year to 860 million, up from 822 million in fiscal 2022. Online visitors, while fewer than in past years (3.8 billion compared with 4.3 billion), accounted for 23% of sales vs. 22% the previous year.
Fiscal 2023 marked Ikea’s 80th anniversary, which was celebrated by rediscovering some favorite designs and reimagining them with new colors, materials and production techniques.
Ikea’s U.S. operations achieved more than $5.9 billion in sales in fiscal 2022, including $3.99 billion in furniture, bedding and accessories, to rank it No. 3 in the Furniture Today Top 100.
