IKEA has seen its profits drop by a third, the Scandi homewares retailer has announced, although sales rose 2 per cent (they are now worth €37bn) and online sales were up 47 per cent.
The company that runs the majority of IKEA stores, Ingka, said the fall in profits was because IKEA has been concentrating on transforming its business, including testing smaller city-centre stores and focusing on its online offering, to make it “better equipped for the next 75 years”.
HuffPost UK headed out to Tottenham Court Road in London, where the company has been piloting one of these city-centre outlets, to ask customers how they felt about IKEA and their experiences of shopping there.
Natalie, who is 42 and works in marketing, is a fan of IKEA’s low prices, but thinks the company is facing growing competition. “There’s more online places to shop like Made.com who are doing more cool, unique pieces,” she said. “Plus I think the stigma surrounding flat-pack furniture still sticks.”
They might be flat-pack, but 61 year-old Grace Cook, wonders if the durability of IKEA products actually works against the homeware store. “My kitchen has lasted 20 years,” she says. “Rather than buy a new one I can just add bits like doors and inside fittings. It would be lovely to see [more] smaller stores, especially for accessories like cushions and cutlery,” she added.
Some people we talked to wondered if the dwindling number of homeowners, thanks to high house prices, meant that people were becoming less interested in homewares. Tom Hutchins, 33, and Stephanie Hutchins, 30, told HuffPost UK that they only began shopping at IKEA once they owned their property.
“We just didn’t feel the need for interior design and it’s only since we’ve moved from Kent to London that we decided to pop into the store, as there wasn’t an IKEA where we were living before. It’s fun that you can make a nice day of it in the bigger stores too, but most of our shopping is done online.”
And what about the small city-centre stores, which allow customers to have a good mooch around an IKEA kitchen or wardrobe unit, then sit down with a staff member to plan them for delivery? Tatum, 36, explained that, previously, IKEA was pretty inaccessible if you didn’t want to drive or didn’t have access to a car.
“Now that there’s the smaller store on Tottenham Court Road which is a much more conveniently placed location, I’ll be shopping with IKEA more,” she said.