Ikea bucks the retail blues as new UK stores and website upgrades give the flat pack furniture giant a sales lift
- Ikea’s full-year sales rose 5.9% to £1.96 billion in the twelve months to August 31
- Online was the standout driver as website sales grew by 14.4%
- Ikea opened new big box stores in the period and is testing a small shop format
Swedish furniture giant Ikea is sitting pretty in the UK as investment in new stores and improvements to its online offer are starting to pay off.
The firm claimed that Brits are still splashing out on home improvements despite the well-documented ‘tough economic environment’.
Nearly 6 million customers visited Ikea in its last financial year, helping it to generate a 5.9 per cent rise in annual sales rise to £1.96billion.
Ikea has 21 big box stores in the UK, but is also testing out a tranche of smaller shops
The sales, and a large jump in market share, were spurred by the opening of two new ‘big box’ stores – in Exeter and Sheffield – as well as significant improvements to its website and delivery options.
Ikea recorded a 13 per cent jump in visitors to its website and a 14 per cent increase in online sales. Website sales now represent more than 15 per cent on Ikea’s total.
Javier Quinones, Ikea’s new UK boss, acknowledged the ‘tough economic environment’ that is currently weighing on traditional furniture firms, such as Carpetright, Homebase and DFS.
A decline in housing market activity and consumer uncertainty in the run up to Brexit is taking its toll on the firms that specialise in home furnishings and DIY products.
He said: ‘Whilst we’re pleased with our performance, we recognise that a challenging retail and economic environment means we need to continue to respond to our customers’ needs and invest in an Ikea that is here for people, whenever and wherever they need us.
‘In a tough economic environment, our homes provide a sanctuary and we know that consumers continue to update them with soft furnishings, textiles and decorations.’
Ikea now has 21 superstores in the UK, and is set to open an outlet in Greenwich in spring 2019.
It has also just opened the doors to its first ever ‘Planning Studio’ in central London – the first step in what it describes as a ‘city centre approach’.
Ikea told This is Money last month that there was potential for ‘lots’ of these smaller format stores in the near future.
Ikea’s first planning studio recently opened on Tottenham Court Road in London
Today, Quinones said: ‘Our stores will always be an important part of the Ikea brand when it comes to inspiration.
‘However, we know that the role of the store is changing. People want to shop in a number of different ways and count on brands to offer them services that reflect the way they live.’
In May the group ditched plans to build a store near Chorley amid uncertainty on the British high street as retailers are hammered with soaring costs.