Economics - Ikea planning expansion into Luxembourg

Branded flags fly outside the Ikea store in Hitech City on the outskirts of Hyderabad

Branded flags fly outside the Ikea store in Hitech City on the outskirts of Hyderabad

"We will contribute positively to the State's development by creating 800-1,000 direct jobs and engage another 1,500 indirectly in services", said Peter Betzel, CEO, IKEA India.

It has opened 19 new outlets this year and now has 422 in over 50 markets. IKEA's fast expansion in India is marked by a huge response it received in the cyber city of Hyderabad in August.

Adjusted for currency impact, sales were up 4.5 per cent at its over 400 worldwide stores.

IKEA Group separately reported local-currency sales growth of 5 percent to 34.8 billion euros.

Last year Ikea's United Kingdom profits slumped by almost 40% to £87m, a decline blamed on higher wages and the cost of investments in its stores and website. Brodin has signed off on a raft of store experiments as well as the purchase of gig economy odd-jobs company TaskRabbit. IKEA stores in India house close to 7,500 products, ranging from kitchenware, bathroom accessories, textiles, cleaning products, wardrobes, home electronics, artificial plant décor and more, and are customised as per Indian needs and usage.

After Sajid Khan, Nana Patekar walks out of Housefull 4
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Ikea is not listed and as a result it is not obligated to publish its net profit or other financial details.

Ikea said its priority was to meet its quality commitments towards customers and co-workers, and alluded that India offers a significant enough market opportunity that is worth being patient for. That includes a new store that was opened in Bahrain in September, Inter Ikea said. Some 936 million customers visited IKEA stores in FY17 and more than 2.3 billion people visited IKEA online. The company will also be launching its e-commerce operations by March next year.

Betzel, who attended the ground-breaking ceremony of Ikea's third India store here Thursday, said the company already had an online platform and was now in the process of connecting different platforms to maximise business prospects. Now, we realise that India presents a much bigger opportunity for which ₹10,500 crore is inadequate.

The retailer will need at least 1 million cubic meters of goods in South America to break even, Loof said.

"Ikea's transformation means franchisees like Falabella have a menu of options to choose from to jump start their expansion, including physical store formats and digital services".

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