IKEA THE GLOBAL TRAILER

IKEA THE GLOBAL TRAILER

Price of Furnitures
200
100
0

IKEA could reduce the price of the Klippan

by some 40 % between 1999 to 2006.
IKEA gains competitive price.

Minimize Production Costs

through outsourcing
Main Components

Outsourcing
All Production
Activities

Development of
Supply Chains in
Low-Cost Regions
Maintain
Product Rights
Establishment of
Swedwood

Features
Est. supplier relationships in Eastern Europe (e.g.
Czech Republic, Romania, Hungary) and in Asia
(e.g. China, Indonesia, Malaysia)
App. 1400 suppliers(2009) -China(22%),
Poland(16%)
Ownership of product rights
Well functioning
and closewhen
relationships
Allow
switching suppliers
necessaryw/
suppliers
Subsidiary of IKEA(est. 1991)
Evolved into a supplier with advanced production
facilities of its own, mainly in Eastern Europe

Source: Global Sourcing Development at IKEA a Case Study Paper prepared for the 25th IMP
conference

Transnational strategy
: IKEA CHINA

Planned 10 stores by 2010

Reflected the layout of Chinese apt in IKEA stores:
Balcony
Home delivery Service: Rare car ownership

IKEA THE GLOBAL TRAILER