Stage 1

Company Profile (Appendix 1)

IKEA is actually an acronym for Ingvar Kamprad Elmtaryd Agunnaryd. The acronym is comprised

of the founder’s initials (I. K., for Ingvar Kamprad), the name of the farm where he grew up

(Elmtaryd), and the location of the farm in Smaland, South Sweden (in the parish of Agunnaryd).

IKEA. The Swedish furniture retailer IKEA is one company that has successfully built a windmill to

take advantage of globalization. It has grown from a Swedish mail order business in 1943, to

operating 263 stores in 24 countries and employing 127,800 people in 2009 (Inter IKEA Systems

B.V., 2009). Until very recently, IKEA is the largest global furniture retail company (Jonsson, 2008)

and this status is not likely to change soon, even in the face of global recession (Euromonitor

International, 2009)

IKEA's achievement

Brand name value - According to a brand survey conducted by American Business Weekly, IKEA
ranks forty-three on the list of the fifty world's most famous brands with a brand value of 56 billion
crown (US $ 7 billion). Another Sweden company Ericsson ranks eighty.

Sales performance - IKEA has 76,000 employees and runs business in 43 countries. Its sales
reached Euro € 11.3 billion in the financial year 2009.

Design, Purchase, Distribution and Sales - IKEA is the only enterprise in the world which successes
in both channel and products operation. Sherwood, the industrial group within IKEA, manufactures
wooden furniture and accessories. Sherwood owns 32 industrial departments in 9 countries.
Ä lmhult-based IKEA of Sweden is in charge of developing IKEA line of products covering 10,000
varieties. IKEA boasts 43 trade companies (TSO) in 33 countries and 1,600 suppliers in 55
countries. IKEA stores are supplied by 27 distribution centers in 16 countries. Currently, there are
186 IKEA stores in 31 countries and regions, among which 165 stores are company-owned in 22
countries and the other 21 stores are operated by franchisees in 14 countries and regions. It's said
that there were 310 million visitors to IKEA stores globally last year.
(The above figures were from IKEA Chinese website.)

A UK professor claims retail outlet Ikea is so attractive to shoppers because its floor design is maze-
like and confuses shoppers. He adds, "The way to the exit is always behind you."