IKEA is an internationally known home furnishing retailer. IKEA was founded in 1943 by Ingvar Kamprad. It has grown rapidly since it was founded in 1943. Today IKEA is the biggest furnishing retailer in the world. It’s simple design style and with good quality products give the deep impression for many people. Low prices are one of the cornerstones of the IKEA concept and help to make customers want to buy from IKEA. This low price strategy is coupled with a wide range of well designed functional products. IKEA’s products cater for every lifestyle and life stage of its customers, who come from all age groups and types of households. This is vital in times when the retail sector is depressed, as it increases IKEA’s potential market.
The first IKEA store opens in China in 1998. It built its first store in Shanghai, its own local factories and raw material supplying foundations in China. IKEA started the second store in Beijing in the following year. Between the year 1999 and 2003, IKEA kept the pace of setting up one new store in China each year. When it began to hold an increasing market share, IKEA speeded up to open at least two stores each year in mainland China. By the year 2010, IKEA will have had 10 chain stores in China. It expands its market into China because IKEA knows how big potential market in China, it wants to share Chinese furniture market. It is an opportunity for IKEA to deep its internationalization, at the same time, it also a chance for China to get more foreign investment. In the past eight years, IKEA really bring the home fashion and new furnishing idea to Chinese ordinary people.
IKEA create an enterprise myth and become the biggest furniture retailer in the world. China is vast furniture demand market and manufacture foundation. IKEA’s vision is to create a better everyday life for the many people. IKEA do this by offering a wide range of well-designed, functional home furnishing products at prices so low that as many people as possible will be able to afford them. IKEA are constantly trying to do everything a little better, a little sampler, more efficiently and always cost-effectively.
In conclusion, IKEA is something new, exciting and fresh to the China customers. China customers do not appreciate this notion, since on the one hand they do not enjoy it, and on the other hand, they believe it is unreasonable to accept the high priced products without assembly, with such high prices. This will make less people choosing the IKEA because consumers do not used to DIY concepts and prefer more on ready used furniture or assembled furniture.
Thus, IKEA should implements the innovations to adapt to the China market. Firstly, IKEA should have greater cooperation with local suppliers to get more competitive advantage of cost leadership. Secondly, according to the specialty of China market, IKEA should have some more adjustment to satisfy so many China picky customers. Thirdly, IKEA should intensify propaganda work to let more customers understand and accommodate the IKEA model. As an out comer, there is a long way to be the winner in this huge and potential market. After a long time to research the China market, IKEA already understand the China market more than before. With accelerating the speed of expand, the success of IKEA in China market is only the problem of time.
The vision of IKEA is to create a better everyday life for the many people by offering a wide range of well-designed, functional home furnishing products at affordable prices. This can make IKEA successful in theirs well designed furniture because IKEA can enhance their uniqueness by continuousness release creative furniture idea on their products and make customers value IKEA well designed furniture and remember IKEA brand image. Thus, IKEA will provide the good quality and affordable price modern furniture with elegant design that is unique and able to attract the China customers.