Improving affordability for IKEA customers
In financial year 2023, IKEA sales amounted to EUR 47.6 billion and Inter IKEA Group continues to progress in its efforts to make IKEA more affordable for the many people.
Today, Inter IKEA Group announces total IKEA retail sales1 for financial year 2023 (FY23)2 of EUR 47.6 billion, an increase of 6.6% (7.3% when adjusted for currency impact) compared to FY22. This positive result was achieved despite the continued challenge of lower sales quantities.
FY23 was a year marked by pulling together to make IKEA more affordable to ensure that as many people as possible can shop at IKEA now and many years to come. Inter IKEA Group also intensified its focus on designing quality-made products by improving material development and optimising production – all aimed at offering customers lower prices.
“Intensification of internal efforts to reduce material and manufacturing costs, led to a decrease in IKEA retail prices at the end of FY23. In challenging times when inflation is high and many people struggle with the cost of living, the need for home furnishing solutions at affordable prices is high. This is where we will continue to do what IKEA has always done – putting customers’ affordability first. Looking further ahead, the three main opportunities we see for IKEA are to become even more affordable, more accessible and more sustainable,” says Inter IKEA Group CEO, Jon Abrahamsson Ring.
In FY23, product availability in IKEA stores improved after the global supply chain shortages of previous years. This was achieved through closer collaboration with partners across the entire IKEA supply chain to solve logistical constraints and improve inventory management.
IKEA continued its steps to become more accessible for customers in city centres by developing small store formats to bring IKEA closer to where people live and work. More than 70 new IKEA sales locations have opened this year – the majority were small stores and plan & order points. The latest addition was a small store in the centre of Copenhagen tailored to local needs, both in terms of better accessibility for the city’s many cyclists as well as changing urban consumer behaviour. Other small stores opened in Madrid, Almeria, Rome, Surabaya, Bavaro, Cabo, San Francisco and Toronto. FY23 also saw the ground-breaking of the first ever IKEA store in New Zealand. Lastly, one month after the close of FY23, IKEA is proud to announce it has entered a new market in South America with the opening of a 26,000 m2 store in Colombia.
Overall, IKEA stores welcomed 860 million visitors in FY23 compared to 822 million in FY22. Online sales have stabilised at 23% compared to 22% in FY22. However, visitors to IKEA online channels were fewer in FY23 at 3.8 billion compared to 4.3 billion last year. This was mainly due to the full lifting of COVID restrictions around the world and a return to physical shopping.
The work to reduce our environmental footprint and lower climate impact also continued apace. One example is the introduction of bio-based glue alternatives after 10 years of internal research. Bio-based glue will reduce fossil-based glue usage by 40% and the climate footprint from glue by 30%, by FY30. We also launched an industry-first global wood supply map.
This increases transparency by showing publicly the origins of the wood used in IKEA products. Another is the SILVERSIDA product series which represents the first successful example of IKEA using ceramic production waste on a large scale to make new tableware. 65-70% of SILVERSIDA products are composed of internal waste at the factory.
FY23 marked 80 years since Ingvar Kamprad founded IKEA in 1943. To celebrate 80 years of design, IKEA returned to its “treasure chest” to rediscover customers’ favourite designs. Iconic products were reimagined in fresh, joyful colours and new materials using the latest production techniques and materials in a collection called Nytillverkad.
“Of course, none of the above would have been possible without our 219,000 IKEA co-workers, who, together with our thousands of partners and suppliers, have worked tirelessly to make IKEA successful in FY23. I would also like to thank all our customers for our first 80 years and the trust they placed in us and our products. We now look forward to the next exciting 80 years as the IKEA brand continues to evolve and respond to the wishes, needs and dreams of people everywhere for a better everyday life,” says Jon.
Read more about FY23 here.
1 Total sales include sales of IKEA products, food and services by the 12 IKEA franchisees.
2 The IKEA financial year runs from 1 September to 31 August.