Ikea Strategy in Egypt

To a great extent Egypt’s relations changed with foreign powers from the eighteenth to the nineteenth dynasties as Egyptian pharaohs adopted policies of diplomacy or military conquest. During the reign of Amenhotep III Egypt’s relations with foreign powers continued to be focused on diplomacy rather than military conflict as Amenhotep sort to maintain peace and prosperity throughout the region. With the accession of Akhenaten to the throne, Egypt’s relations with foreign powers and its vassal’s changed dramatically with the rise of the expansionist Hittites and the decline of Mitanni. The nineteenth dynasty saw a shift in Egypt’s foreign policy with its neighbours, as Seti I sort to restore the glory of Egypt and embarked on a campaign of expansionism

Some modern leaders look more inward as to their nations’ policies and people to affect change. Hosni Mubarak, former President of Egypt, aimed to unite his country and better certain systems to strengthen the nation. When in a hard and confusing time, Mubarak provided Egypt with a steady guiding hand. In the midst of this chaos, instead of addressing the questions and wants of the people, Hosni Mubarak demanded they offer themselves to supply the needs of their country and support their leader. This mindset calmed Egyptians as Mubarak reopened Egypt to the Arab world, tried to reaffirm the constitution and judicial system, and tackled social issues. (New Leaders of Nations #1). Former prime minister of India

This paper aims to demonstrate a detailed description of the elements of ‘IKEA’ company based on its famous name in the furniture industry.

With a rich history and culture dating back into the biblical ages, Egypt is a country that has witnessed the world grow into what it is today. With ancient age comes ancient problems and fierce feuds between neighboring countries that result in high tensions and often times violence. As an ally, the United States has observed Egypt 's plight and struggles in the Arab World and has attempted to, on numerous occasions, to quell the violence that stems from the region. Though America 's intentions are good, Egypt usually finds itself in deeper trouble due to intervention from the west. Subject to much change in both political and social policies, Egypt finds itself in the uncomfortable position of

Recently overthrown political leader Hosni Mubarak held the presidential position in Egypt from 1981-2011. He was only the fourth president to be elected in Egypt’s recent Republic government system starting in 1954. He abused his power and always won elections by massive margins. In the 2010 Egyptian elections, Mubarak’s party, the National Democratic Party (NDP), won 83% of the preliminary round of elections. He was widely accused of fraud and cheating on ballots . An Egyptian rights group called the Independent Coalition for Elections’ Observation commented that, “The elections were full of widespread violations that brough Egypt at least 15 years back” 3. This ballot fraud was a major contributor to Egyptian riots in 2011 during the Arab

One of Nasser’s many goals was to make Egypt into a leader of the Arab States and in order to this he understood that Egypt had to be chiefly independent (“Cold War Lesson #2”). Replacing Western leaders with Egyptian leaders would forestall security threats and ensure Egypt as the head of all the states (Metz). This was necessary because he needed to show the other Arab nations that they did not have to rely on the West. This would not be possible if he were also dependent on the West. In order to be a leader, the Arab nations would need to look to Egypt for clarity and help, instead of the United States. In order to deem Egypt successful, Nasser wished to end political subordination to western powers and imperialism, restore Egypt’s identity by creating their own culture that was no longer distorted by Westernization, and to create Egypt’s own, independent economy (Metz). These goals required much more than just support behind them, they required a significant amount of money. In order to get this money, Nasser decided to acquire a policy of nonalignment (“Cold War Lesson #2). This meant that he would not ally with the United States or the Soviet Union even though they both had many interests in Egypt. This policy aided Nasser in receiving as much as he could from both sides without having to commit to either. While this policy did work out for Nasser, he eventually

IKEA is a global furniture retailer, which is established on the concept of contributing wide range of well designed, functional, and low cost home furnishing products in 40 countries, with 330 stores and 154,000 workers (The IKEA concept, 2012). IKEA was founded in 1943 by Ingvar Kampar and has turned in an international furniture retailer that specialized in stylish but inexpensive furniture designs.

Egypt today can be a viable market for the foreign investor, especially the investor who has the ability to see the rewards of in investing in the region for the long haul. The world and Egypt both realize that the region is the gateway to the Middle East. Egypt is leading the way for Arabic countries to embrace a new way of doing business and opening their borders to the ‘global village’ concept.

IKEA is one of the largest multinational companies in the world dealing with several products. The company sells and designs furniture appliances and home accessories at an affordable price. Ikea has over three hundred stores worldwide enjoying the good name it has created for itself. While they are one of the most profitable furniture companies in the world there are significant challenges and threats that have been overcome and are still needed to be tackled.

In 2011, Egypt’s economy was disrupted by a revolution that resulted in the dethroning of its president. During this period of economic and political downturn Egypt’s economy grew

The practice of world trade amongst countries has taken over the rate of domestic production. It has led to the free flowing of money across national borders, which opens doors for companies and investors to seek for best rates for financing anywhere across the globe. Such trend is known as globalization and Cullen & Parboteeah (2008) defines globalisation as the worldwide trend of borderless and interlinked world economies, and companies no longer restrain by domestic boundaries and possibly conduct any business activities throughout the globe.

The stores have restaurant, childcare facilities and plenty of parking. Customers can drop off their kids at the playroom and have delicious meal when they are tired. All of these not only provide customer with a comfortable shopping environment but also let them make an ‘IKEA trip’ and enjoy the fun of buying. Besides, IKEA’s distinctive show rooms help creating differentiation. Products are strategically placed in different small spaces like rooms which allow customers imaging this furniture in their own home. This makes everything looks more attractive.

In PEST analysis, we will look into what will be affect by the business environment. It includes political environment, economical environment, social environment and technological environment.

In august 2008, IKEA had total 253 stores where 560 million people visited. Here the total sales became 23 billion Euros. Considering 20% sales profit here IKEA’s average customer per store and cost per store are given below:

As for foreign relations, Egypt was the first Arab state to establish diplomatic relations with the state of Israel, after the signing of the Egypt-Israel Peace Treaty. Egypt has a major authority between other Arab states, and has historically played an important role as an intermediary in resolving disputes between various Arab nations, and in the Israeli-Palestinian dispute.