17 Dec 2020
Posted in Business Fundamentals
COVID-19 fails to deter Ikea’s store opening plans in India, says GlobalData
Following the news that Ikea is all set to open its second large format retail store in Navi Mumbai, India on 18 December 2020;
Aurojyoti Bose, Lead Analyst at GlobalData, a leading data and analytics company, offers his view:
“The COVID-19 pandemic did not deter Ikea from pursuing its large format offline retail expansion plans in India. The 500,000 square-feet Mumbai store will be the second large format store after the launch of the first one in Hyderabad in 2018. The move forms part of the retailer’s ambitious plans to open more than 40 retail outlets across the country by 2030. Easing of COVID-19 related restrictions and potential vaccinations could be the deciding factors for the timing of the launch.
“Ikea sees India as an important market and is leveraging its omni-channel retailing strategy, ranging from online stores to small and large format offline stores, to expand its customer reach. Along with physical stores, its online presence has also become critical with some customers preferring contactless and safe shopping. The Swedish furniture retailer already has an online presence in cities such as Hyderabad and Pune and is now aiming to foray into more cities with the omni-channel approach. The company is set to start work on its India’s biggest store in Noida. It is expected to be completed by 2025.
“The Mumbai store launch can also be a step forward in making the city the first Indian market to fully adopt Ikea’s hybrid business model. Ikea has already launched its online store in Mumbai, in August 2019. Moreover, it plans to launch two small format stores in 2021. Such a hybrid model, if it succeeds, could pave the way for such experiments in other cities across the country.”