Ikea's Global Sourcing Challenge
IKEA’s Global Sourcing Challenge: Indian Rugs and Child Labor (A)
Case Synopsis
IKEA is a “privately held, international home products company that designs and sells ready-to-assemble furniture such as beds and desks, appliances and home accessories” (www.worldisyouroyster.com). The company was established in 1943 by Ingvar Kamprad in Sweden when he was just 17 years old. Kamprad himself, who still owns the private company, is rumored to be the world’s richest man. IKEA is currently the world 's largest furniture retailer and arguably the most successful global retailer. Being one of the biggest global retailers, IKEA benefited a lot by the globalization of its business; IKEA’s target market is the global middle class who is looking for low-priced but attractively designed furniture and household items.
The company started as a home-furniture retailer in Sweden over 50 years ago. Throughout the years with the use of effective globalization, “IKEA managed to increase its business revenue and profit by selling and making home-furniture in different countries all over the world, and it has over 300 retail stores in more than 30 countries” (www.ikea.com). Other than that, they sell roughly 10,000 different products, which attract customers from different places all over the world. The basic assumption behind IKEA 's global strategy was “one-design-suits-all,” which meant that the company did not adapt to the local markets (www.salon.com).
The case “IKEA’s Global Sourcing Challenge: Indian Rugs and Child Labor ” is about IKEA’s development from a backyard company to one of the world’s largest furniture retailers, which has to deal with the issues of child labor and how they should behave considering economical issues and the company’s policy (Bartlett et al 8).
Case Questions 1. How should Marriana Barner respond to the question of IKEA to have a representative appear on the upcoming broadcast of the German video program?
Being an organization
Case Synopsis
IKEA is a “privately held, international home products company that designs and sells ready-to-assemble furniture such as beds and desks, appliances and home accessories” (www.worldisyouroyster.com). The company was established in 1943 by Ingvar Kamprad in Sweden when he was just 17 years old. Kamprad himself, who still owns the private company, is rumored to be the world’s richest man. IKEA is currently the world 's largest furniture retailer and arguably the most successful global retailer. Being one of the biggest global retailers, IKEA benefited a lot by the globalization of its business; IKEA’s target market is the global middle class who is looking for low-priced but attractively designed furniture and household items.
The company started as a home-furniture retailer in Sweden over 50 years ago. Throughout the years with the use of effective globalization, “IKEA managed to increase its business revenue and profit by selling and making home-furniture in different countries all over the world, and it has over 300 retail stores in more than 30 countries” (www.ikea.com). Other than that, they sell roughly 10,000 different products, which attract customers from different places all over the world. The basic assumption behind IKEA 's global strategy was “one-design-suits-all,” which meant that the company did not adapt to the local markets (www.salon.com).
The case “IKEA’s Global Sourcing Challenge: Indian Rugs and Child Labor ” is about IKEA’s development from a backyard company to one of the world’s largest furniture retailers, which has to deal with the issues of child labor and how they should behave considering economical issues and the company’s policy (Bartlett et al 8).
Case Questions 1. How should Marriana Barner respond to the question of IKEA to have a representative appear on the upcoming broadcast of the German video program?
Being an organization
Cited: Bartlett, Christopher A., Vincent Dessain, and Anders Sjöman. IKEA 's Global Sourcing Challenge: Indian Rugs and Child Labor (A). Boston, MA: Harvard Business School, 2006. Culture, Pop. “Ikea 's Third World Outsourcing Adventure -- in the U.S. - The Labor Movement - Salon.com.” Salon.com - Salon.com. Web. 25 Apr. 2011. <http://www.salon.com/news/the_labor_movement/?story=/tech/htww/2011/04/11/ikea_s _third_world_outsourcing_adventure_in_the_united_states>. "FAQ." Welcome to IKEA.com. Web. 25 Apr. 2011. <http://www.ikea.com/us/en/customerservices/faq>. Samy, L.A. ,and Vijayabascar, M. “Codes of Conduct and Supplier Response in the IKEA Value Chain.” October 3, 2006. http://www.inmotionmagazine.com/global/lasamy_ikea.html#Anchor-Key-11481 "The World Is Your Oyster! » Topic 1: Overview and Introduction to International Business." The World Is Your Oyster! Web. 25 Apr. 2011. <http://worldisyouroyster.host56.com/?cat=3>.