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Swedish furniture behemoth IKEA is going aggressive on its retail rollout, with the company announcing that it will soon start work on its second store, set to come up in Maharashtra.
Company officials also said IKEA will be launching its first distribution centre in Pune besides doubling local sourcing to €600 million, from the current €318 million. “We will be undertaking the ground breaking ceremony on May 18. IKEA will focus on omni-channel retailing in markets like Mumbai. The Mumbai store will have an area of 4,30,000 sq ft and will entail an investment of ₹700 crore,” Patrik Antoni, Deputy Country Manager, IKEA India, told BusinessLine .
Last year, IKEA had acquired a 23-acre land parcel in Turbhe, Navi Mumbai, for its second store from Tata-owned Rallis India for approximately ₹214 crore
IKEA is also in the process of scaling up its online business in many countries, including India. Additionally, it is scouting for property in Mumbai for launching ‘Hej Homes’, which may also act as its omni-channel retail format.
For the Maharashtra market, the company plans to have various smaller store or consumer touch points. BusinessLine had reported that IKEA will be launching its pop-up store Hej Homes in cities where it plans to start retail operations.
The 4,000-7,000 sq ft Hej Homes ( Hej is Swedish for ‘hello’) are typically housed in areas with a high footfall, such as malls. These would house a cafe and a play area for children, and mirror IKEA’s big-box retail format in smaller formats.
IKEA’s first fully operational store is slated to come up in Hyderabad later this year. Taking a cue from that store, the company is also undertaking skill development programme in Mumbai to train talent ahead of its opening in the middle of 2018.
IKEA, which manufactures and sells home and office furnishing products, had announced plans to invest in single-brand retail trading in India through a 100 per cent subsidiary. In 2013, the company had got clearance from the Foreign Investment Promotion Board to invest ₹10,500 crore over 10 years for setting up stores in India.
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