IKEA Battles Amazon and Temu as Market Shifts Bring Pain
The world’s biggest furniture retailer is contending with one of the toughest periods of its more than 80-year history.
IKEA furniture chain founder Ingvar Kamprad in front of the first store in Stockholm in 1989.
Photographer: Lars Nyberg/AFP/Getty Images
As the first snow fell in November over Älmhult, the small Swedish town where IKEA was born in the 1940s, managers of the world’s biggest furniture retailer from across the globe gathered for its annual summit on products, prices and priorities.
Beneath the bonhomie under the warm glow of Scandinavian lamps and the corporate talk of “togetherness” was a sense of urgency. The iconic global brand with its familiar blue-and-yellow logo is traversing one of the toughest periods of its more than 80-year history: flat sales, soaring timber costs and brutal competition from online marketplaces like Amazon.com, Temu and Shein. Profit at Inter IKEA, its worldwide franchiser, plunged 26% in the year ended Aug. 31 after it cut prices to stay competitive.