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IKEA’s focus on its customers brings outstanding results for 2012
02-06-2013 13:01
[National]  Total sales up 6.3% to £1.23billion, online sales up 24.9%, bedrooms business up 16.7%
IKEA, the world’s leading home furnishing company, today announces its total sales of £1.23billion in the UK for the financial year ending August 31st 2012, representing a total increase of 6.3% in like-for-like sales and the biggest growth seen in six years. IKEA’s position as leader in the market was also strengthened with market share growing by 0.4% to 6.8% , despite a 2.2% drop in total sales in the home furnishing sector.

Online like-for-like sales increased by 24.9%, achieved after a further 1500 products were made available to buy online following consumer demand and the continued global website developments to enhance the online shopping experience.

IKEA experienced great success in the bedrooms product category, with an increase in like-for-like sales of 16.7%, after a £2.5 million investment to redesign the bedroom showrooms in all UK stores to better reflect the life at home of local consumers. A £15 million investment to reduce the price of the most popular bedroom storage range, ‘PAX’, contributed to the increase as more customers found the range affordable to buy for their homes. IKEA increased its bedroom category market share by 0.8% and continues to lead the category with a total share of 8.3%.

Following feedback from customers, new in-store ‘Pick and Delivery’ and ‘Furniture Take Back’ services were launched, which also contributed to the growth.

Despite the annual Retail Prices Index inflation rate standing at 2.9% in August 2012, IKEA reduced prices by a total of 0.6% of total turnover, continuing a long tradition of making home furnishings more affordable to consumers, particularly in a period when family’s disposable income budgets were decreasing.The successful results come after IKEA was named ‘The Nation’s Favourite Retailer’ in the Verdict Consumer Satisfaction Awards in April 2012.

Improving the customer shopping experience
Throughout the year, a total of £30 million was invested in improving the shopping experience for customers, including the bedroom showroom redesigns. Other highlights include:
• £4.7 million to lower the cost of in-store home delivery: Now starting from just £15, the in-store home delivery service is more accessible to customers than ever before
• £1 million invested in a new Market Hall design at the IKEA Warrington store: a potential solution for all IKEA stores aimed at being more inspirational and easier to locate products for customers
• £7.5million to increase the size of the IKEA Birmingham store: extended by 2500m² to facilitate more practical ideas and solutions to inspire customers
• £5.3 million investment for an external warehouse at the IKEA Edinburgh store: enabling more products to be available to take home on the same day
• Launch of a mobile friendly website and development of mobile apps: offering customers extra content, ideas and inspiration alongside the new 2013 IKEA catalogue
In addition, IKEA were granted planning consent from West Berkshire Council to build the 19th store in the UK, contributing to the local economy and jobs market while making IKEA more accessible to the people in West Berkshire and Reading.

Improving customer service
In financial year 2012 IKEA invested heavily in co-worker training, putting a focus on developing co-workers’ competence around understanding customers and their lives at home. Highlights include: • Over 500 visits to consumers’ homes: to understand the challenges, needs and dreams of people living close to the IKEA stores
• £600k investment for co-workers in the Bedroom and Kitchen department: to improve knowledge of how the IKEA product range can enable customers to live a happier life at home, such as getting a better night’s sleep with the bedrooms range
• Continuation of the international ‘Back-Packer’ programme: 12 UK co-workers spent one year in development roles in other IKEA countries under an international programme. All have been promoted to new roles in the UK organisation.

A Sustainable Future that meets customers’ expectations
In 2012, IKEA invested a total of £3.3million installing 38,000 solar PV panels on the roofs of its stores up and down the country, which supported the company’s ambition to become energy and resource independent by 2020.

IKEA has also pledged to help customers live a sustainable life at home by offering products and solutions that help them to save money by using less energy and water and reducing waste: • In October, IKEA announced its intention to convert all lighting in its range to LED by 2016, which last for 20 years and save 85% energy
• IKEA also has ambitions to offer the most energy efficient home appliances on the market at the lowest price and will offer low price, functional and easy to use solutions for sorting and minimising waste and using less water at home.

Looking ahead to 2013
Over the last 25 years, IKEA has developed a deep knowledge of consumers’ everyday lives at home alongside an understanding of what they think about and what they want from the brand, in order to be a more relevant retailer for their needs. Placed alongside the great value for money offer and willingness to invest in the UK, there are many opportunities to grow the business in the UK.

Carole Reddish, IKEA UK and Ireland Acting Country Manager, said, “In these challenging times it is very humbling that our efforts to give customers the best value for money home furnishings and inspiring solutions for their life at home has resulted in such strong growth.

Despite 2012 being a tough year for retail, we listened carefully to what our customers were telling us and invested heavily in improvements to the shopping experience. We know that we still have a lot of work ahead to ensure that all who shop with IKEA, both in-store and online, have a great shopping experience.

In the coming year we have an ambition to revitalise our brand identity in the UK. We will continue to show customers that we understand the challenges they face every day in their homes, connecting our value for money offer with their needs and their dreams. We will also provide thousands of practical ideas, solutions and points of inspiration that will give loyal customers something new on every visit and will encourage new customers to consider IKEA for the first time.”

- ENDS –
Notes to editor

• IKEA had 41.3 million visitors in the UK stores, an average of 2.29 million per store, in the year to 31 August 2012.
• Sales for the IKEA Group for the financial year 2011 increased by 6.9 per cent to a total of 24.7 billion Euros compared to 2010. More information can be read in ‘Welcome Inside’, available here.
• IKEA is the world’s leading home furnishing retailer with a grand total of 287 IKEA stores in 26 countries/territories that are visited by 655 million people every year. IKEA UK has 18 stores and IKEA Ireland has 1 store. The first IKEA store in the UK was opened in Warrington in 1987.
• Last year, the annual IKEA catalogue was printed in 208 million copies, 59 editions and in 30 languages. In total, the catalogue was read by 400 million people in 41 countries. For the year to 31 August 2011, there were 870 million visits to the IKEA website.
• The IKEA Group has 131,000 co-workers in 41 different countries over four continents. 106,500 in Europe, 16,500 in North America and 8,000 in Asia and Australia. There are 7200 employees currently working at IKEA UK and Ireland organisation.
• IKEA has a range of 9,500 different home furnishing products.
• IKEA was established in 1943 by Ingvar Kamprad at the age of 17, in Småland in Sweden.
For more information please contact:
IKEA Press OfficeLewis Marshall or Lois Blenkinsop / 0845 225 7126

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