Question

what is the decision facing IKEA?

Answer 1

IKEA is one of the top furniture and furnishing company that is famous for quality products, low prices and best services to the customers. The company is facing some decision situation to move ahead and expand. The first decision is related to the expansion decisions of where to expand and how to expand. The company has already its presence in major locations in the world, but the company can identify key locations in emerging economies to expand such as India, Brazil, South Africa with the presence of in-store presence. These economies represent some of the countries who are growing with the faster pace than the others. The second important decision faced by the company is the trade-off between either going only through in-store as a single sales channel, or creating a strong and proactive online sales through web store or social media channels in addition to the in-store offerings. Here, the company should not ignore the potential of online sales as it has the ability to cater the larger audience size, low price guarantee and can attract those audience also who prefer convenience shopping. More specifically, in new markets like India In-store in combination with the web store, will help in reducing the cost of operation, cover the bigger geographical area with selected presence and grow the sales. So, IKEA should bring a strategic shift by giving attention to the online sales channels.