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Here's what's in store for Indian shoppers at Ikea

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Here's what's in store for Indian shoppers at Ikea
Swedish Prime Minister Stefan Löfven looking at an artist's impression of a planned Ikea store in 2016. Photo: Tobias Österberg/TT
13:56 CEST+02:00
Ikea's second attempt to break into a vast market will meet the 'needs, frustrations and dreams' of local customers, the Swedish furniture giant's boss has promised.

"We bring an inspiring, affordable and convenient home furnishing offer," CEO Jesper Brodin said a day before the grand opening of the furniture giant's vast store on the outskirts of the southern city of Hyderabad.

"We promise to give great quality at affordable prices and try to expand quickly and reach other parts of the country with multiple stores," Brodin told a news conference.

Ikea, whose founder Ingvar Kamprad died in January, is present in 49 countries but its previous shot at getting a piece of India's burgeoning middle class in 2006 fell foul of local regulations.

This time around, Ikea expects to attract seven million visitors per year to its Hyderabad store, the first of 25 outlets it hopes to open across the country of 1.25 billion people by 2025.

But Brodin admitted having to give Ikea's business model a local twist of Indian spice to try to attract a vast middle class not used to a company expecting them to assemble their products themselves.

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The differences between the furniture giant's 400-odd outlets elsewhere and Hyderabad start in the 1,000-seater restaurant, its biggest worldwide and according to Ikea "possibly India's largest".

Instead of beef or pork, the company's signature meatbals – almost as famous as its Billy bookshelves – will be either chicken or vegetarian. Local favourite biryani is also on the menu for 99 rupees ($1.44).

"We have changed quite a lot for India. We have two ranges. One is the Swedish unique range and one is the local range," Ikea food manager Henrik Österström told AFP.

"Food is part of the total experience. It's a big store and you need to have some energy boost halfway through. So we have sold everything here at different parts of the day," Österström said.

Alongside standard Ikea furniture, on offer are "locally relevant products" such as masala boxes, Indian frying pans called tawas, rice cake makers and mattresses with a coconut-fibre centre.

There are also more than 1,000 products under 200 rupees to satisfy consumers that John Achillea, Ikea Hyderabad store manager, says have "big aspirations for their homes and small wallets".

A major hurdle for Ikea's DIY model, successful elsewhere, is abundant cheap labour and ubiquitous family-run shops whose staff visit customers' homes and assemble furniture.

Ikea has therefore teamed up with UrbanClap, an online platform that helps connect handymen with consumers, and the firm also met 1,000 families to try to understand their needs.

After Hyderabad, Ikea plans to open outlets in the financial capital Mumbai next year, followed by stores in Bangalore and New Delhi as it seeks to grab a share of India's estimated $40 billion home goods market.

But analysts warn that profits won't come quickly or easily.

"Ikea will have to focus on staff training, the right mix of branding and reaching out to more customers in smaller cities and towns. Profitability will take time," Satish Meena, or research firm Forrester, told AFP.

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