Ikea founder calls for more job cuts

Ikea founder calls for more job cuts
Swedish furniture retailing giant Ikea needs to shed more employees, company founder Ingvar Kamprad said in an interview published on Monday.

Ikea has already made 5,000 employees redundant around the world, but it now appears the company is prepared to let more people go.

“We need to reduce our personnel further, especially within manufacturing and logistics. It’s both about adjusting to sales which are well below what we budgeted for and becoming more effective,” Kamprad told the Dagens Industri (DI) newspaper.

In Sweden, Ikea has already cut 420 positions.

Kamprad, who is 83 and set up Ikea in 1943 as a teenager, explained sales were 7 percent below what the company had budgeted for.

“That corresponds to 8 billion kronor ($1 billion) on an annual basis which we have to adjust to,” he was quoted as saying.

Kamprad, who now lives in tax exile in Switzerland, also said the company would hire a few thousand people to work at its 14 new stores planned to open worldwide this year.

Ikea is an unlisted, privately-owned company and therefore does not release regular earnings reports, but outgoing managing director Anders Dahlvig has said it expects sales of €21.5 billion ($30.1 billion) excluding currency effects for its fiscal year ending August 31st.

Member comments

Become a Member to leave a comment.Or login here.