IKEA Case Study

2983 Words12 Pages
To: Carol George
From: Fangyi Shao
Subject: IKEA case study
Date: 24. Apr. 2009

1. Introduction
IKEA is the world’s largest furniture manufacturer who offers a wide range of well-designed, functional home furnishing products at a low price that many people can afford it. IKEA’s mission statement describes the purpose and distinctive advantages of the company clearly. (See appendices Ⅰ) It can also motivate management by saying ‘create a better everyday life for people’ because employees need work together to achieve this goal.

2.0 SWOT analysis (See appendicesⅡ)
2.1 Strength
Ikea was ranked 35th among the best global brands around the world in 2008 with a brand value of $10,913 million. (Interbrand, online, 2009) IKEA
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As one of IKEA’s fundamental innovation is the concept of self-service, RFID could give several benefits to IKEA because it can support self-service. Not only can customers get away from the queue by using RFID equipped cash desk, but also sharing accurate availability information through Electronic Price Labels. (idtechex, online, 2009)

3.4 Environmental
Now, more and more people concern company’s corporate social responsibility on environment issues. IKEA needs to increasing energy efficiency and reducing their emissions of greenhouse gases to prove their concern on environment. Therefore, IKEA have to invest more on green issues and try to maintain low cost in the meanwhile, which is a big challenge. (IKEA, online, 2009)

3.5 Legal
The minimum wage for 21p have risen to £5.73/h in March 2008, which brought IKEA with extra cost on labour. (bbs.news, 2009, online) IKEA also needs to show the company’s equality and diversity in employment.

Due to product safety issues, IKEA must follow more policies to ensure the safety of product, which will be an additional financial burden of the company.

4.0 Porter’s five force analysis
The furniture retailing industry in UK is very competitive, so the extent of competitive rivalry of the five forces is the most significant to IKEA. (See appendices Ⅳ) Except IKEA, there are several big furniture retailers such as Galiform Plc, and DFS

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