IKEA

SWOT ANALYSIS

Presented by:-
Ankita Sapra
Divya Kapoor
Jasleen Kaur
Shreya Agarwal
Introduction
Founded:1943 in Älmhult, Småland, Sweden
Type: Private
Headquarters: Leiden, The Netherlands
Industry: Retail (Specialty)
Products: self-assembly furniture
Revenue: € 22.71 BN (FY 2009)
Employees: 127,800 (FY 2008)
Website: www.ikea.com
Acronym- I (Ingvar)-Founder’s first name
K (Kamprad)-Founder’s last name
E (Elmtaryd)-Farm where he grew up
A (Agunnaryd)-Home village
Logo- Blue & Yellow;
The colors of Swedish National Flag.
HISTORY
 1943:
founded in Sweden by Ingvar Kamprad;
 1951:

published the first IKEA furniture catalogue;

 1955-1956:

designed own furniture

tested to use flat packages for shipping;
 1987:

opened the first store in warrington

 2001:

established IKEA Rail

HISTORY: FIRST STORE AROUND THE WORLD
 1958: in Sweden
 1963: in Norway
 1969: in Denmark 265 shopping centers
 1973: in Switzerland
 1974: in Germany
36 countries
 1975: in Australia
 1976: in Canada
 1981: in France
 1985: in USA
 1987: in UK
 1989: in Italy
 1998: in China
 2000: in Russia
HISTORY: IMPORTANT DESIGNS IN THE PAST

1963: Marian Grabinski

designed MTP
Bookcase.

1974: Olle Gjerloy

Knudsen and Torben
Lind designed SKOPA
Chair.
1985: Niels Gammelgaard
designed MOMENT
Sofa.

1994: KUBIST Storage

Units appeared.
VISION AND MISSION STATEMENT

The IKEA vision globally is to create a better

everyday life for the many.

Mission:-
At IKEA Tempe we are dedicated to giving to the
local community well being regarded by our
customers and co-workers as a social responsible
company"
INTERNATIONAL BUSINESS

IKEA stores around the world ：

"United States, Denmark, Germany, Spain, Israel, Saudi
Arabia,"
WHAT’S A SWOT ANALYSIS?
Strategic planning method used to evaluate a project’s

Strengths
Weaknesses
Opportunities
Threats
SWOT: INTERNAL FACTORS
 Strengths
 positive tangible and intangible attributes.
 internal to an organization.
 within the organization’s control.
 Weakness
 factors that are within an organization’s control.
 detract from its ability to attain the core goal.
 shows areas required to be improved.
SWOT: EXTERNAL FACTORS
 Opportunities
 External attractive factors
 represent the reason for an organization to exist and develop.
 Identify opportunities by their “time frames”
 Threats
 External factors
 beyond an organization’s control
 places the organization mission or operation at risk.
 Classify them by their “seriousness” and “probability of
occurrence”.
STRENGTHS
OF
IKEA
STRENGHTS
 Material usage as required
 Strong global brand
 Its vision
 Strong concept
 Use of waste or recycled materials. Eg.: the NORDEN table and
the OGLA chairs
 Democratic design:-
 Function
 Quality
 Design
 Price
 Volume commitments
 Economies of scale
 Sourcing materials close to the supply chain to reduce
transport costs.
 Delivering products directly from the supplier
 Using new technologies
STRENGTH ANALYSIS/MEASURE

vision

Key Performance assess Setting targets and

Indicator monitoring
progress

Long term
goal

Ex . : IWAY
approved suppliers
WEAKNESSES
OF
IKEA
WEAKNESSES
 Size and scale of its global business
 Need for low cost products
 Good communication with its consumers and
other stakeholders.
OPPORTUNITIES

 Growing demand for greener products

 Growing demand for low priced products.
 Demand for reduced water usage and lower
carbon footprints.
STEPS TO GRASP OPPORTUNITIES
 Solutions for a sustainable life at home
 Sustainable use of resources.
 Reducing carbon footprint.
 Developing social responsibility.

 Being open with all its stakeholders.

THREATS
THREATS
Threats to IKEA may stem from:
 SOCIAL TRENDS – such as the slowdown in first time buyers
entering the housing market. This is a core market segment for
IKEA products

 MARKET FORCES – more competitors entering the low price

household and furnishings markets. IKEA needs to reinforce its
unique qualities to compete with these

 ECONOMIC FACTORS –the recession slows down consumer

spending and disposable income reduces
WAYS USED TO MINIMIZE THREATS
If a company is aware of possible external threats, it can plan to
counteract them. IKEA uses its particular strength to defend against
threats in the market.
 Online help to guide customers to a more sustainable life leads to control
SOCIAL THREAT

 Economies of scale leads to barriers to entry, by which MARKET

THREAT was minimized

 Low priced, good quality and design product offered by IKEA increases
demand for product even in recession and in this way overcame
ECONOMIC THREAT
 SWOT’S
CONTRIBUTI
ON
CONTRIBUTION OF SWOT ANALYSIS TO IKEA’S BUSINESS
GROWTH

 improve performance by reducing its

weaknesses and using its strength
 able to generate the strong growth by grasping
opportunities available in market and by
minimizing its threats.
 retain a strong identity in the market.
SIMPLE RULES FOR SWOT ANALYSIS
 Be realistic about the strengths and weaknesses of your
organization or group.
 Distinguish between where your organization is today,
and where it could be in the future
 Be specific: Avoid gray areas.
 Always analyze in relation to your core mission.
 Keep your SWOT short and simple. Avoid complexity
and over analysis
 Empower SWOT with a logical
conceptual framework.
CONCLUSION
IKEA is a well-known global brand in home furnishing with hundreds of
stores across the world. It assess its external and internal environment,
which reveals its strength, weakness, key opportunities it can take
advantage of and threats it must deal with. IKEA responds to both
internal and external issues in a proactive and dynamic manner by
using its strengths and reducing its weaknesses. IKEA’s passion
combines design, low prices, economical use of resources, and
responsibility for people and the environment. Through this, IKEA is
able to generate the strong growth it needs to retain a strong identity
in the market.

IKEA has discovered a business truth –

Being sustainable and responsible is not just good for customers and
the planet, it is also good for business.