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WEALTH

Ikea proves goldmine for Kamprad

Swedish furniture goliath Ikea is still showing few signs of slowing down. The store’s sales increase last year generated almost 5 billion kronor in royalties to the man who started it all.

Ikea Group’s chief, Anders Dahlving, said the Group is with reaching distance of hitting 160 billion kronor in turnover for the financial year that ended a few weeks ago, according to Dagens Industri.

Some 3 percent of Ikea Group’s turnover goes to Inter Ikea System, a part of Ikea that owns the business concept and trademark. This means the store’s founder Ingvar Kamprad and his family can pull out 4.8 billion kronor.

In two years, the royalty income has increased by 1.5 billion kronor. Today, there is no other Swedish stock holder who can take out that much money from a business.

Ikea’s goal is to continue increasing turnover and to take royalty revenue up to 10 billion kronor after 2010.

It is not known what Inter Ikea Systems does with all of the other billions of kronor it has made beyond its investments in buildings and stocks.

IKEA

Ikea will buy back your used furniture at up to half the price

In the run-up to what would in normal times be the festive season sales rush, Ikea has vowed to buy back used furniture from customers to resell – and pay up to 50 percent of the original price.

Ikea will buy back your used furniture at up to half the price
Got any pieces of Ikea furniture at home? You may be able to get rid of it and get money back. Photo: Fredrik Sandberg/TT

Ikea, the world's largest furniture chain, said Tuesday it would begin buying back used furniture from customers to resell – and pay up to 50 percent of the original price.

The “Buy Back Friday” scheme, timed to coincide with the “Black Friday” pre-Christmas retail frenzy, will run from November 24th and until December 3rd in 27 countries.

“Rather than buy things you don't need this Black Friday, we want to help customers give their furniture a second life instead of making an impulse buy,” said Stefan Vanoverbeke, deputy retail operations manager at Ingka Group, Ikea's parent company.

To address concerns its affordable, flat-pack products encourage overconsumption and waste, the Swedish company had previously said it would start renting and recycling furniture as part of an eco-drive.

Under its buyback scheme, the group said that “anything that can't be resold will be recycled or donated to community projects to help those most affected by the Covid-19 pandemic”.

“Some countries like Australia and Canada for example are currently testing different buyback services, but BuyBack Friday will be the first time that 27 countries do this together,” the statement added.

The Swedish giant employs over 217,000 people and has more than 50 outlets. Its annual turnover is around 40 billion euros ($46 billion).

The group did not specify how it would determine the price paid for second-hand furniture and customers will receive a voucher, not cash, for their products.  

As part of efforts to reduce waste, Ikea has already begun repairing and re-packaging products in every store that have been damaged in transit, as well as allowing customers to return products – including furniture – for resale or donation to charities.

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