IKEA Essay
Recently, IKEA is one of the most renowned brands of retailers around the world with 351 stores in 43 countries in September 2014 (Wikipedia). China, particularly, is known broadly as the most potentially profitable with a population of approximately 1.4 billion people. This country, hence, has become one of the core target in the strategy of internationalization of IKEA. Chinese market contribute eight of the ten largest IKEA’s stores in the globally according to Hatton (in November 2013). This essay will illustrate the enlargement of IKEA via profit, the number of visitors and customer satisfaction; and some trouble that it overcame when establishing IKEA’s stores before discussing several potential risks such as the lack of stores, local competitors and old technologies in China. To begin with, the amount of sales in China was reported positively by IKEA in 2013 was assessed as a fastest-growth market over the world in the total income in the fiscal year ended August. 31 occupied 37$ billion compare with 35.5$ billion in the same period of time last year (Jens Hansegard, 2014). In addition, although China is the country which has the largest population in the world, the number of visitors who go to IKEA stores is really impressive. Take IKEA’s flagship store in Beijing is a great example, this store welcomed 28,000 customers on a Saturday that is similar with the amount of weekly customers in an IKEA store in another country and more than 6 million visitors in 2011, which was recorded as the biggest-volume for IKEA in the world (Jens Hansegard, 2012). Besides that, the most vital reason for the development of IKEA is the satisfaction of Chinese consumers. To be specific, IKEA stores supply countless ordinary furniture for people so that it is easy to purchase everything here. Furthermore, Chinese customers often feel comfortable and relaxed when they go to IKEA stores because they can enjoy every modern equipment although maybe they do not have plan to buy
References: Celia Hatton, 2013, Ikea in China: Store or theme park? http://www.bbc.co.uk/news/world-asia-china-24769669 Jens Hansegard, 2012, Ikea taking China by storm http://online.wsj.com/articles/SB10001424052702304636404577293083481821536 Jens Hansegard, 2014, Ikea sales boosted by China http://online.wsj.com/articles/ikea-sales-boosted-by-china-1410246927 Valerie Chu, Alka Girdhar and Rajal Sood, 2013 Couching tiger tames the dragon http://businesstoday.intoday.in/story/how-ikea-adapted-its-strategies-to-expand-in-china/1/196322.html