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INGVAR KAMPRAD

Ikea founders mull sale of Habitat furniture chain

The family of Ingvar Kamprad, the Swedish billionaire founder of the Ikea discount furniture chain, is thinking about ditching the high-end Habitat furniture and design chain.

On Sunday, the group’s chief the executive confirmed the possible sale of Habitat, whose sales have been hit by the economic downturn.

Parent company ICAF Antillen, acting for the Kamprad family, has launched a “strategic review” that “may or may not lead to a sale of the company,” chief executive Mark Saunders said in a statement, confirming a London Sunday Times report.

Founded by Sir Terence Conran in 1964, Habitat employs some 1,500 people with 38 stores in Britain, 24 in France, six in Spain, five in Germany and retail partnerships in a further 14 markets.

Ingvar Kamprad, best-known as the founder of furniture giant Ikea, acquired Habitat in 1992.

The chain’s owners have hired the Lazard bank to look into “options” for its future, Saunders said.

“This is an ongoing process with a number of options currently under discussion,” he said. “No decision has been made yet.”

According to the Sunday Times, Habitat’s sales have been knocked by the global downturn, but it is also struggling to compete because of high prices, poor customer service and a badly-targeted product range.

Habitat’s British operations lost £13.4 million pounds ($21.9 million) in the year ending March 2008, the report said.

Saunders was hired in April with instructions to return Habitat to profit within three years, and recently signed up supermodel Helena Christensen as the new face of the group.

While the review is underway, he said store openings would go ahead in Britain, including in the northern city of Liverpool, and Europe.

Kamprad is now the richest man in his adoptive Switzerland with a fortune valued at some €23 billion.

Ikea has shed 5,000 jobs worldwide since the start of the economic crisis.

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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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