IKEA has brought its vision to life at its stores and shopping centres in Thailand, Singapore, Malaysia, Vietnam*, the Philippines and Mexico serving a combined 480 million people: to create a better everyday life for the many people. This despite a truly challenging year with the ongoing COVID-19 pandemic. As stores were shut for a record 83 days in 2021 in addition to being impacted by supply disruptions and restrictions on retail businesses, IKEA Southeast Asia and Mexico marked a number of achievements – pivoting to new businesses, growing its e-commerce business, and increasing revenue in the previous financial year. The company is on the path to recovery from COVID impacts.
Christian Rojkjaer, CEO of IKANO Retail, said, “While the pandemic has gone from crisis to a constant, our 4,321 co-workers tackled one challenge after another head-on packing parcels and getting products to customers’ doors during store closures, adjusting our logistics and racing to keep pace with inquiries from customers when the global shipping crisis pushed stock levels to record lows, standing by tenants and ensuring meeting places remain safe as re-openings took place, launching new programmes to take care of our co-workers and communities, and unveiling a refreshed focus on sustainability. Against the odds, our six markets managed to grow revenue in the September 2020 to August 2021 financial year while helping customers make life at home (and work) better.”
Achieving growth amid challenging conditions
IKEA Southeast Asia and Mexico grew revenue 3.3% in a tremendously challenging year, posting 736 million euros (about 27.7 billion baht) in sales. Revenue in Thailand reached 212 million euros (7.97 billion baht), down slightly from the previous year but a strong result given the lockdown that took place amid the broader pandemic during the financial year.
The business in Malaysia shrank dramatically, down 13.9% from the year earlier period as stores and centres were closed for up to 83 days due to the pandemic, though Singapore showed strong growth up 21.2%. Two new store openings, in Mexico as well as the largest IKEA in the world in the Philippines, and a strong focus on e-commerce contributed to the higher total year-on-year revenue. Visits to IKEA’s websites surpassed 100 million for the first time and a new shoppable IKEA app engaged even more customers resulting in 864,000 fulfilled orders and sold a total of 135 million euros (5.07 billion baht) through e-commerce.
IKEA Family attracted 400,000 new members across the five markets (more than half in the Philippines, IKEA’s newest market) as consumers focused squarely on what matters most – health, families and homes, with many looking for affordable kitchen, bedroom and workspace solutions to make life at home more comfortable and functional. IKEA’s Workspaces range proved immensely popular growing 19% as more people continued to buy desks, chairs, filing cabinets and more to work from home.
Focused on sustainable solutions
IKEA Southeast Asia and Mexico is moving beyond its leading position in home furnishings to become a true omni-channel retailer. In response to the pandemic and the changes to how people are living and working at home, IKEA’s entrepreneurial teams launched several new ventures to meet the changing needs of communities beginning with a Planning Studio to help consumers create their dream homes, the relaunch of IKEA for Business meeting the needs of small businesses, and new IKEA Food ventures offering food delivery to the doors of customers or a click and collect option for people on the go.
The company’s sustainability strategy was refreshed with input from leaders across all markets, with measurable targets set, and a commitment to action in business plans across all stores and shopping centres. Three focus areas were unveiled to make the biggest difference: Healthy and Sustainable Living; Circular and Climate Positive; and Fair and Inclusive, resulting in a reduced carbon footprint, the sharing of new ideas for sustainable living, and being a role model for diversity and inclusion.