Essay on Case Study : Ike Scandinavian Style

823 Words May 12th, 2016 4 Pages
Case Study 3.0 IKEA: Scandinavian Style

1. Background information. In 1943, Ingvar Kamprad started the company IKEA. IKEA was designed to help provide families with low cost furniture after the war. In 1953, IKEA opened its first showroom. In 1964, IKEA opened its first warehouse store, in doing this it elimated distribution by allowing the customer to pick up their purchases at the warehouse. Ingvar Kamprad learned at an early age how to master running a profitable business. As a young boy he bulk purchased matches and sold them for a profit. As the owner of IKEA, this helped him in making wise decision on purchasing fabrics in bulk and building strong relationships with companies to make his furniture. In 1955, IKEA created the "flat box" approach. This basically was selling unassembled furniture. This idea changed the whole home furnishing industry. In IKEA all of its furniture manufacturing is outsources to other companies. IKEA uses short term purhasing agreements that can easily be changed to stay cost effective. IKEA has been able to become a global brand with suppliers and stores in over 50 countries.
2. Problem Statement: IKEA biggest problem has become its globilization into many different countries. IKEA currently has 1,300 suppliers in 53 countries. As of 2010, IKEA has 332 IKEA stores in 41 countries. This poses many problems because not every country likes the Scandinavian style IKEA is known for. One of the biggest problems IKEA faced was…

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