Business Report of Ikea

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Contents

Section                                                           Page

Executive Summary        

Introduction        

SWOT analysis        

Strength        

Weakness        

Opportunities        

Threats        

PESTEL analysis        

Conclusion and recommendation        

References        

Appendices        

Appendix I: SWOT analysis        

Appendix II: PESTEL analysis        

Executive Summary

The main task of this report is to evaluate the current state of IKEA’s UK operations via using SWOT and PESTEL analysis. According to the analysis, this report will give some recommendations for IKEA UK to expand their businesses in the competitive home-furniture market.

This report illustrates that IKEA UK faces fierce competition with other low cost retailers and loses customers who consider the long distance and massive traffic jam when driving to IKEA. However, there are a lot of positive factors could help IKEA to expand their market share, such as robust economic expectation, stable political system and increasing online sales. So there is an energetic home-furniture market in UK for IKEA.

Finally, based on all internal and external factors, the report recommends that IKEA UK should increase investment on online retail, improve the experience of in-store shopping and reduce costs in a smart way without lowering quality of products.    

Introduction

IKEA Group is one of the largest home-furniture chains, which was founded in 1943 by Ingvar Kamprad in Sweden. According to IKEA Group Yearly Summary FY13 (2013), IKEA group owned 303 stores in 26 countries, with 684 million visits and €27. 9 billion total sales in 2013. IKEA UK also has grown rapidly since it opened the first stores in Warrington in 1987. There are 18 IKEA stores in UK, and the market share of IKEA UK grew by 0.2% to 6.4% in 2012 (Marshall and Blenkinsop, 2013). Moreover, the vision of IKEA is“To create a better everyday life for the many people”. So it provides a range of 9,500 different well-designed home furnishing products which could be affordable for many customers and different types of family at low price.