Ingka Group, a Netherlands-based holding company that stands as the largest operator of Ikea retail stores, is investing 3 billion euros ($3.2 billion) in new and existing stores by the end of next year.
The investment will be focused on new physical stores, such as the one that opened in Nice, France, on May 11. The company also will revamp existing stores to create a more immersive experience for customers.
“More than ever before, we want to optimize our network of stores in order to cater for an inspiring shopping experience – no matter how or where our customers choose to engage with us,” said Tolga Öncü, retail operations manager for Ingka Group. “With this investment we aim to secure the long-term viability of our business by making Ikea more accessible, more affordable and more sustainable.”
A big part of improving the shopping experience includes allocating more resources to order fulfillment for online shoppers. The company rebuilt the Ikea store in Kuopio, Finland, to better accommodate online order fulfillment, allowing customers to get their orders in half the time and with 40 percent reduced cost of delivery for pick-up parcels.
City stores in downtown Stockholm and Toronto will soon welcome customers with more than 2,000 products for immediate takeaway and larger furniture items available for home delivery. As part of the company’s Canada expansion plan, Ikea will open a new distribution center in Quebec and a planning studio in Montreal.
Ingka is also investing nearly 1.2 billion euros ($1.27 billion) in London, including in the Oxford Street store, new services, and in opening a distribution center in Dartford that will enable home deliveries within 24 hours across the capital. In Madrid, where customers can already shop at three traditional stores, two city stores, or have their orders delivered to their home or new pick-up points, a third city store is in the pipeline.
“Our stores remain one of our biggest strengths, and we will continue to transform them to meet the needs of our customers for generations to come,” Öncü said. “We see many of our stores playing a dual role, giving our customers the best of both physical and online retailing and the investment will support not only an inspiring in-store IKEA experience but also a faster and more affordable shipping of online orders directly from our stores.”
Over the past three fiscal years (2019-2021), Ingka Group invested more than 2.1 billion euros ($2.22 billion) in existing and new stores across its 32 markets.
“Even in our more mature markets, like Germany or Spain, we will continue investing because we still see good potential to expand our business and help even more people create a better everyday life,” Öncü said.