Ikea Group, the world’s biggest home-furnishings retailer, plans to increase the number of outlets fourfold in China as the world’s most populous nation is set to become the company’s second-largest market.
“China will be Ikea’s number two market relatively soon, and number one maybe in the long run,” Chief Executive Officer Mikael Ohlsson said in Shanghai yesterday. The furniture retailer plans to add five stores to the 11 it currently has in the country and boost the total to 40 by about 2020, he said.
The Swedish company, controlled by billionaire founder Ingvar Kamprad, is seeking to open stores in higher-growth emerging markets to offset its reliance on Europe which is plagued by recession. Europe is home to 245 of its 338 stores, as of August 2012. That figure includes shops run as franchises, according to the retailer’s website.
China’s economic growth will accelerate to 8.4 percent this year, from 7.8 percent in 2012, the World Bank has forecast. That compares with a 0.1 percent contraction in the euro area, the bank predicts.
Ikea plans to add new stores in locations such as Shanghai, Beijing, Ningbo and Chongqing, Ohlsson said in a speech at Webster University China. The retailer, which is also looking to open more stores in Russia this year, is testing an Internet- based e-commerce business in 10 countries to complement its physical stores, he said.
To contact Bloomberg News staff for this story: Liza Lin in Shanghai at firstname.lastname@example.org
To contact the editor responsible for this story: Anjali Cordeiro at email@example.com