IKEA announces next step of its business transformation
IKEA (Ingka Holding B.V and its controlled entities) is accelerating its transformation, stepping up investments in new and existing IKEA stores and fulfilment centres, developing city centre formats and focusing on its e-commerce platform, to better meet the needs of its customers and be more convenient and affordable to many more people.
Building on many years of solid growth and as part of a transformation, Ingka Group is assessing all parts of the organisation and is simplifying to enable a greater focus on adding value to its customers. As a result, in the coming two years 11,500 new jobs will be created globally, through opening around 30 new IKEA touchpoints, investments in its fulfilment network and in digital capabilities. At the same time 7,500 jobs may be made redundant, out of the total 160,000 co-worker population, mainly focusing on global functions and offices in 30 markets.
Jesper Brodin, Chief Executive Officer, Ingka Group says: “We continue to grow and perform strongly. At the same time, we recognise that the retail landscape is transforming at a scale and pace we’ve never seen before. As customer behaviours change rapidly, we are investing and developing our business to meet their needs in better and new ways. We will put greater emphasis on making our existing stores even better and taking the opportunity to renew and reinvent our business in a way that is inspired by our history, culture and values. Our values guide our work and build our inclusive, open and honest culture. It’s all based on a spirit of togetherness and enthusiasm and we will continue to transform with that spirit.”
In the UK and Ireland, IKEA continues to invest significantly, with a focus on greater convenience. In FY18, the retailer opened two new stores in Sheffield and Exeter. IKEA also opened its new Planning Studio on Tottenham Court Road, the first step in its City Centre Approach, starting with London.
As well as the opening of new stores, IKEA has invested heavily in its distribution and fulfilment network with two new Customer Delivery Centres and a Parcel Unit opening in London.
IKEA Greenwich will open its doors in spring 2019, creating 500 new jobs. However as part of this next phase of the transformation it is anticipated 350 jobs out the 12,100 UK and Ireland roles may be made redundant during the next two years.
Javier Quinones, IKEA UK and Ireland Country Retail Manager said: “We have been in the UK and Ireland for more than 30 years and IKEA has revolutionised the way people live, and the way people shop. Today it is hard to imagine a home without an IKEA product. However, we are in fast-changing retail environment and while we continue to grow, we are evaluating how we can remain relevant in the eyes of consumers – now and in the future. We recently announced our City Centre Approach starting with London and we will continue to invest in being more convenient through our enhanced service offer and digitialisation.
While the opportunities ahead of us are exciting, we know that some of the changes won’t always be easy and in some cases, we will have to make difficult decisions.
Co-workers are at the heart of our business and throughout this transformation we will have an ongoing dialogue on how to navigate these changes, to ensure we do this in a way in line with our values and ensuring that our co-workers feel supported. We are confident these changes will secure the future of IKEA and will benefit its customers and ultimately its co-workers.”