Ikea invests €1.2 billion in Europe price cuts
Swedish budget furniture retailer Ikea announced a new wave of price cuts as it tries to boost demand in Europe, at a time when the surging cost of housing in many countries has dented people's ability to move and curbed spending on furniture and homeware.
Swedish furniture retailer Ikea is cutting prices across Europe by €1.2 billion in an effort to boost demand, as rising housing costs make it harder for people to spend on furniture. The cuts aim to attract cash-strapped shoppers and drive sales after two years of declining revenue. Ikea CEO Juvencio Maeztu noted that many people now live in shared accommodations, making storage solutions more important than ever.
In Ireland, Ikea is lowering prices on 457 products by up to 25%, including a mattress reduced from €299 to €229 and shelving unit from €70 to €59. In Germany, the company is cutting prices on over 1,500 products, such as the Poang chair from €179 to €119. Ikea's CEO, Jakub Jankowski, explained that the company is constantly optimizing costs through redesigns and using renewable energy.
Europe is a crucial manufacturing hub for Ikea, with production in Poland, Italy, Lithuania, and Germany. To attract new customers, Ikea has opened seven smaller stores in Europe since January, moving away from its traditional big-box model. Other Ikea franchisees have also agreed to price reductions in Spain, Turkey, Greece, Cyprus, Bulgaria, Iceland, and Estonia, Latvia, and Lithuania.
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- Ikea cuts prices on 1,500 products in Europe freemalaysiatoday.com
