Mba505 Ikea Slowly Expands Its Us Market Presence

1. Given the SWOT analysis presented in the case, what are IKEA’s key competitive advantages? What strategic focus should the company take as it looks to further expand into the U.S. market?

This will keep driving their costs down, therefore increase their profits and reduce their price that will most likely increase their market share. But most importantly, since IKEA, will have some kind of implementation in these markets, it will be easier for them in terms of sourcing raw materials and manufacturing the products. It will ease the logistic, make it even more efficient thought their network of storage facilities throughout the world.

IKEA is rumored to be a very standardized retailer, i.e., a certain set of marketing strategies is used that are the same around the world. This indeed sets IKEA, operating on markets in Europe, US as well as Asia and Australia, apart among international retailers. Often the theoretical conclusions in international

IKEA needs to think on a broad scale of how they can distinguish themselves among the current American market and create customer loyalty.

This report analyses IKEA’s issues, drawbacks and its implications in the global market. Along with reasons behind the furniture giant’s pitfalls, presented are a few solutions to overcome these drawbacks.

We believe what is good for society is good for IKEA. We are passionate about creating a successful business where we act in a responsible way through small and large actions. It is a way of being. This is why sustainability is a cornerstone in the IKEA strategic direction – it is highly prioritized and serves as a driver of further innovation and development. Economizing with resource, finding new ways of doing things and developing our knowledge and expertise are important parts of our business idea and heritage. A low price company must be a low cost company, and this includes being careful with earth’s limited resources. IKEA has unique capabilities and tremendous enthusiasm to make a positive contribution across the world – from the forests of Siberia to the cotton fields of India and all the way into people’s homes in New York, Lisbon and Shanghai. Our customers rightly expect us to not only to make our products in a responsible way, but also to help them live more sustainable

IKEA’s vision is to design a better life at home. Making it affordable as possible so that many people could have admirable furnishing. IKEA use function, quality, design and value to obtain their customer needs. IKEA learn to synchronise the contingency of the supplier and needs of the customers. Using that strategy to sustain the low prices. In order to gain a good condition of a product, IKEA go in for highly automated production. Together with mass producing and keeping long-term relationship with the supplier, IKEA is able to prolong their vision and aim to serve their customers. (Ikea.com/sg)

1. Design- IKEA designers work in exactly the opposite way from their competitors. They design their products in such a way so that they can keep the prices low. IKEA designers design every product starting with a functional need and then decide on price. With the help of their vast knowledge in innovation and low-cost manufacturing processes through a large network of suppliers, they design the final product which can fulfill consumer’s functional needs. Large volumes are purchased to push prices down even further by distributing the R&D cost. Most IKEA products are designed in such a way so that they can transport in flat packs and assembled at the customer's

A different approach about Ikea’s success is given by Sara Kristofferson in her book Designed by Ikea, London 2014. In the first chapter, Kristofferson refers to the relationship between the swedish goverment and Ikea.

The company is known for modern designs, in various appliances and furniture, and its interior design work with eco-friendly simplicity. Furthermore, the firm is known for its cost control, operational details, and continuous product development. These corporate attributes allowed IKEA to lower its prices, during a period of expansion.

IKEA has achieved success by offering customer value for functional designer products. The cost conscience attitude has worked in favor for IKEA amongst its target market.

IKEA's strategy is derived from environmental conditions; the Swedish company's understanding before customers want functional furniture, the attractive and modern design, and affordable, with immediate availability. The furniture has lost its status as a heritage object, to become a universal object of consumption.

IKEA has a broad target market. They aim to appeal to customers of all demographic with one thing in common which is price preference.

The organization's three particular components are capacity, quality and low cost. In the 1950's IKEA Built up its own particular manner of doing things, utilizing, for instance, non-conventional materials for furniture for example, plastic. That methodology made IKEA unique in relation to other furniture retailers and in that way built up an upper hand. "After that, we essentially replicated the idea Worldwide from the 1970s until now. The vision of IKEA is "To make a superior regular Life for some individuals". Business thought is "To offer an

A. Several factors take part in IKEA’s success. The fact that the products are not manufactured in just one location, rather in different places around the globe, has a big impact. The products are matched with manufacturers who already assemble the same or similar items, so less time and money has to be spent to train the workers. Also because of this, other cultures are able to relate to the products, where as if everything was made in Sweden, they may not. The contracts made with manufacturers in exchange for support from IKEA enables the manufacturers to produce products at a lower cost. Also, the manufacturers being located globally and IKEA having several distribution centers that are located in various countries reduces the transportation costs to get the products to the store or consumers. Because of these, IKEA has been successful with a standard line of products as the costs to produce more extensive designs would cost more to