TEAM NASH

-NAMAN ARORA
-SHANTAM SINGH
  Vision, Mission and Problem
Statement
• Vision: To create a better everyday life for many people. This vision goes beyond
home furnishing.
• Mission: Our business idea supports this vision by offering a wide range of well-
designed, functional home furnishing products at prices so low that as many
people as possible will be able to afford them.
• Problem Statement: Ikea recently opened its doors for the Indian furniture
market. It aims to grow its reach and simultaneously work on modifying its
business model based on consumer preferences and spending habits.
 Furniture Market and Major Competitors 
The Indian Furniture market is divided into two sectors: 1) Organized Sector and 2) Unorganized Sector. The Organized Sector
accounts for 15% market share while the major chunk of pie is with the unorganized sector.
• 1. Godrej Industries- With 15% market share in the organized sector, Godrej is the leader in the segment. It has already invested
Rs. 4 billion and plans to invest another Rs. 2 billion as part of its expansion plans.
• 2. Zuari Furnitures- It boast of providing premium quality furniture online at cheap rates. Has the largest manufacturing plants in
Asia, which can produce 2,00,000 units a year.
• 3. Durian- Serves the niche segment with its premium products and has 3 major factories and several stores in Maharashtra which
threatens IKEA's recent expansion plan, which is to take on Mumbai.
• 4. Nilkamal – Has 35% share in the plastic furniture industry segment. Has good presence in the retail industry and one of the
biggest supplier of cheap furniture to homes.
• 5. Pepper Fry – Has been a leading name in the online furniture industry and has been catering to the population with its wide
range of products.
• 6. Urban Ladder- Follows a model similar to Pepper fry with good quality products and services and caters to the market segment
that IKEA wants to target.
Other competitors such as Flipkart Perfect Homes and fabfurnish are trying to get hold of the market and impose a direct threat.
 The following perceptual map is drawn on
basis of different aspects and  compared across
6 different products types and 15+ furniture
categories. The comparison have been made on
basis of prices, service availability, customer
review, availability of product in different
locations and accessibility.

• IKEA has positioned itself a cheap and

affordable furniture.
• The target audience for IKEA is population of
the age of between 20 to 34 and mostly 
includes population residing in urban areas.
• To target the niche segment, it has brought in
a brand "IKEA exclusive" line and
repositioned itself.
• Modular fittings means more space for homes
and the largest market- Mumbai Metropolitan
where large living space is an issue, has the
highest share in terms of housing furniture
industry.
 Industry Specific SWOT Analysis
Strengths
• Modular Furniture provides a competitive advantage over its rivals.
• Comes with a brand tag which adds to how the brand is perceived.  CAGR and by 2026 is bound to be a US $ 37.72 bn.
• Has opened up two retails stores in Mumbai, which has the
highest housing furniture market.
• Cost Differentiation because of flat pack system , which
immensely reduces shipping and inventory costs.
Weakness
• Being a new entrant, it doesn’t have that reach and customer
awareness that other established brands already have.
• Finding space big enough for Ikea’s trademark large stores in
India’s notoriously congested cities also poses a challenge
• Low retail penetrations when compared to Godrej which has
205 exclusive showrooms and 800 dealers across 650 cities.
• Has registered another year of loss, though made a significant
increase in its sales.
Opportunities
• As of 2020, the Indian Furniture Market stands at mammoth US $ 17.77
bn, the projected estimates are the industry would grow at 13.37%
• Growing Disposable Income and Expansion of housing and real estate
• IT and Services Boom ( which has led to increased offices)
• Improved lifestyle and increased desire for stylish homes by
middle class Indians at low cost.
Threats
• Established players like Godrej and Pepper Fry have already
capitalized on the market opportunities.
• They have experience in these markets and have much
better production capabilities and supplier connection.
• Have understood the customer taste and preference and exactly
know what to offer.
• Prising Indians away from local furniture makers that they trust
is going to be difficult for Ikea, according to retail experts.
 Strategic Partnership with Hospitality
Sector and Restaurant Chains
• The hospitality sector is expected to grow at a CAGR of around 13%.
•  According to the Indian government, by 2030-31, India would have a market of 1.2
million cruise travelers. In the next 3-5 years, the Dream Hotel Group expects to invest
roughly USD 300 million in the development of the Indian cruise industry.
• This growth is bound to bring in more travelers which means
requirements of hotels. Strategic partnerships with Hotel chains, such as OYO which has
country wide reach and a huge demand in modular furniture can be fulfilled by IKEA.
• IKEA can partner with hotel chains to provide them with furniture and meet the demand.
• Restaurants in India and Restaurant chains are growing at a steady pace, though
the industry on a whole is growing at 7%, the overall development in number of
restaurant chains is immense, tapping these industries can bring in immense growth for
IKEA.

This Photo by Unknown author is licensed under CC BY-ND.

 Targeting the
Office Furniture Space
• The growth in the IT and services sector has brought in large
offices and workspace. This growth in this segment was halted due
to the  pandemic, but with the ongoing developments, the IT
economy is slowly getting back on track, and this means more
offices spaces required. It has already registered a 15.5% YoY
growth in 2021.
•  According to JLL India, in the first six months of 2021 (January–
June 2021), new supply of office spaces in India reached 25.11
million square feet (sq. ft.), an increase of 75% YoY, across major
cities (Delhi-NCR, Mumbai, Bengaluru, Pune, Hyderabad and
Chennai), due to improved confidence of realty companies for
recovery of the workspace demand.
• IKEA though caters to the need of this segment through its store
and "IKEA for business" but still it only adds to the existing online
experience.
• Service these business houses and offices would mean that, IKEA
could get hands on a growing market.
 A Mall-Model
Approach
•IKEA can have additional Revenue Stream by following
a Mall-Model Approach:-
What do we mean by that?
•Whenever you enter a mall, you see different brands
having different shops so you can compare different
products and buy according to your need.
• IKEA can use its massive space to host-brands and
have additional revenue as a brands space hosting
will not only let them have a diverse range of
products/brands but also let in every demographic
category of customer having different
needs/backgrounds/income level/tastes & preference.
• Earn the hosting revenue with minimal/statutory
associated costs
• Compete with other brands at the time under their
own turf and their conditions.
 Why just STOP @ Furniture?
• Whenever a person goes for furniture shopping, he is either looking for:-
1. Re-Modelling the house
2. Moving into a new house(new home buyers)
3. Big Construction Houses building completely furnished Ready-to move-IN Homes
Etc...
With the furniture comes along compliments and supplements such as interior furnishing,
drapes and designs to give a complete look.
IKEA can slowly be a One-Stop-Furnishing solutions to many home buyers and developers.
This also put them in the competitive position against Homecenter Furnishing chains and
many other brands providing the same category of products other than furniture or
compliments to it.
 THANK YOU

References:
• https://www.ibef.org/blogs/office-space-witnessing-growth-in-india
• https://www.ibef.org/pages/21423
• https://www.business-standard.com/article/companies/ikea-foray-godrej-interio-lin
es-up-rs-6-bn-investment-to-expand-capacity-118061500531_1.html
• https://www.mordorintelligence.com/industry-reports/india-furniture-market
• https://www.businesswire.com/news/home/20210809005373/en/India-Furniture-M
arket-Report-2021-Industry-Size-Growth-Trends-Opportunity-Company-Analysis-
Financial-Insights-2020-2026---ResearchAndMarkets.com\