Questions On Business Practices Of Ikea Essay

IKEA was founded in Sweden in 1943 by Ingvar Kamprad. IKEA is a home furnishings retailer unlike any other. It was founded on the basis of low cost and it offers modern and stylish furniture for all types of people at affordable prices. IKEA’s unique way of shopping, store layout, and do-it-yourself approach continues to help maintain their popularity.

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

”The IKEA Concept starts with the idea of providing a range of home furnishing products that are affordable to the many people, not just the few.” *http://www.ikea.com/ms/en_GB/this-is-ikea/the-ikea-concept/index.html

IKEA’s social responsibility and sustainability is continuing to grow and progress according to Chief Sustainability Officer, Steve Howard. IKEA wants their business to have a positive impact on the world so they have implemented a strategy called the People & Planet Positive strategy which focuses on 3 areas (IKEA Group, 2014). The first area of focus is to get customers on board with living a more sustainable life at home

Strategic alliances could reduce the complexity of logistics if IKEA is able to find a reliable partner in this field.

In the world today, companies are working hard to change the way that they run their businesses. Out of various different companies and business, one company that seemed to have a great deal of consideration towards social responsibility was Aldi. The purpose of this paper is to describe what corporate social responsibility is, the history of Aldi, and the approach Aldi takes towards sustainability and how they are a sustainable business. Also, what their future goals are, achievements they have made, and how they plan to invest in new technology to further their corporate social responsibility.

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.

Q1. Critically discuss the purpose and application of the following two models, and highlight the differences between them:

IKEA has strong global brand name recognition by its various types of modern designs of furniture and appliances. It is the largest furniture retailer in the world which operate 351 outlets in 46 countries(Reuters 2008). IKEA put a lots efforts to offer high quality and innovative products at low prices, so that the price of products are affordable for as many people as possible (IKEA Group Sustainability Report FY13 2014). IKEA is one of the major buyers of wood in the retail sector which consumed approximate 1% of the total commercial-product wood in the world (IKEA Group Sustainability Report FY13 2014). The performance of IKEA with regards to balancing society’s expectations will be examined and critiqued in this paper. This paper will

And by offering the right products at the right prices we will help our customers live a more sustainable life at home. IKEA has an important role to play in terms of taking responsibility for people and the environment. This is why sustainability is one of four cornerstones in the new Group strategy “Growing IKEA – together”. We have a strong foundation to build on – it is in our culture to twist and turn established truths to find a new angle, a new idea, and to have the courage to try to do things differently. IKEA is obsessed with making more from less, and we hate to waste resources of any kind. This will continue to be our compass in years to come, and we will stimulate new thinking and innovation in our sustainability work. Innovation is needed to build sustainable solutions into the IKEA range and to tackle some of the global challenges society faces. We need to identify and use more resource efficient materials and develop better solutions for reusing and recycling IKEA products once our customers no longer want them. I believe IKEA together with our customers, co-workers, suppliers and the rest of society can make a big difference. The 50 million low-energy bulbs purchased at IKEA in the past three years represent energy savings equivalent to the output of four and a half nuclear plants, and substantial reductions of carbon dioxide emissions. This gives just a hint of the potential that lies in the word “together”!

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.

The supply chain needs tight control and high levels of visibility to keep costs down and avoid obsolete inventory and/or stock outs.

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:

IKEA’s strategy towards its suppliers is that of a low production costs strategy. IKEA wants to sell its products at the lowest possible price therefore their

IKEA was founded in Sweden by Ingvar Kamprad in 1943. IKEA has been established around the world in 26 different countries. Within these countries IKEA has a total of 303 stores. This business is effective in adapting to change through the use of the four key business functions; operations, finance, marketing, and human resources.