Essay on Ikea Case Analysis

995 Words Oct 12th, 2014 4 Pages
A) What was the source of IKEA’s success in Sweden early on (50s and 60s)?
In 1943, IKEA was founded by Ingvar Kamprad at his home town, selling mainly pencils, postcards and other merchandise. From late 40s to early 50s, manufacturing furniture was introduced as a complement to general merchandise. This enabled Kamprad to step in the furniture business and exploring situation and finding new opportunities. The business had gain massive success in the domestic market for the since opening and the key to its achievements is Kamprad’s leadership. He not only had the vision for the furniture industry, market’s situation, and enthusiasm for business, but Kamprad also played an important role in managing the company’s resources, turned it into
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Several stores were opened in Scandinavian region in just less than a decade. Taking over the market share at that market, IKEA was able to create a reputation throughout the European area, this certainly cleared a path for its further expansion. The furniture industry at the other European countries was stagnant and sluggish in reacting to the IKEA’s fresh breeze
In addition to that, with the established partnership with suppliers in central Europe area, IKEA was able to bring to the market the most suitable solution for consumer’s need. Because of the company had already familiarized with the suppliers network and market needs, establishing the business at the European market will not be a difficult task. Similar practice was used when IKEA tried to gain its position in other continent market.
Stores tried to keep stock low, cost cutting (packaging > less human cost, smaller stock keeping unit…)

C) How was IKEA able to manage this complex strategy in a variety of national markets in a period of rapid expansion?
As a global company with amazing growth rate, IKEA was able to manage its business firstly by Ingvar Kamprad’s leadership. Because of company’s operating area was relatively large, along with comprehensive product range, IKEA tried to keep processes as simple as possible in order to achieve a lean flow of material and processes from resources to production. As stated in

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