IKEASWOT ANALYSIS

Presented by:-Ankita SapraDivya KapoorJasleen Kaur

Shreya Agarwal

Introduction

Founded:1943 in Älmhult, Småland, SwedenType: PrivateHeadquarters: Leiden, The NetherlandsIndustry: Retail (Specialty)Products: self-assembly furnitureRevenue: € 22.71 BN (FY 2009)Employees: 127,800 (FY 2008)Website: www.ikea.com

Acronym- I (Ingvar)-Founder’s first name K (Kamprad)-Founder’s last name E (Elmtaryd)-Farm where he grew up A (Agunnaryd)-Home village Logo- Blue & Yellow; The colors of Swedish National Flag.

HISTORY

1943: founded in Sweden by Ingvar Kamprad; 1951: published the first IKEA furniture catalogue; 1955-1956: designed own furniture tested to use flat packages for shipping; 1987: opened the first store in warrington 2001: established IKEA Rail

HISTORY: FIRST STORE AROUND THE WORLD

1958: in Sweden 1963: in Norway 1969: in Denmark 1973: in Switzerland 1974: in Germany 1975: in Australia 1976: in Canada 1981: in France 1985: in USA 1987: in UK 1989: in Italy 1998: in China 2000: in Russia

265 shopping centers

36 countries

HISTORY: IMPORTANT DESIGNS IN THE PAST

1963: Marian Grabinski designed MTP Bookcase.

1974: Olle Gjerloy Knudsen and Torben Lind designed SKOPA Chair.

1985: Niels Gammelgaard designed MOMENT Sofa.

1994: KUBIST Storage Units appeared.

VISION AND MISSION STATEMENT

The IKEA vision globally is to create a better everyday life for the many.

Mission:- At IKEA Tempe we are dedicated to

giving to the local community well being regarded by our customers and co-workers as a social responsible company"

INTERNATIONAL BUSINESS

IKEA stores around the world："United States, Denmark, Germany, Spain, Israel, Saudi Arabia,"

WHAT’S A SWOT ANALYSIS?

Strategic planning method used to evaluate a project’s

Strengths Weaknesses OpportunitiesThreats

SWOT: INTERNAL FACTORS

Strengths positive tangible and intangible attributes. internal to an organization. within the organization’s control.

Weakness factors that are within an organization’s

control. detract from its ability to attain the core

goal. shows areas required to be improved.

SWOT: EXTERNAL FACTORS

Opportunities External attractive factors represent the reason for an organization to exist

and develop. Identify opportunities by their “time frames”

Threats External factors beyond an organization’s control places the organization mission or operation at

risk. Classify them by their “seriousness” and

“probability of occurrence”.

STRENGTHS OF IKEA

STRENGHTS

Material usage as required Strong global brand Its vision Strong concept Use of waste or recycled materials. Eg.: the

NORDEN table and the OGLA chairs Democratic design:- Function Quality Design Price

Volume commitments Economies of scale Sourcing materials close to the supply chain

to reduce transport costs. Delivering products directly from the supplier Using new technologies

STRENGTH ANALYSIS/MEASURE

Key Performance

Indicator

assess

vision

Long term goal

Setting targets and monitoring

progress

Ex . : IWAY approved suppliers

WEAKNESSES

OF IKEA

WEAKNESSES

Size and scale of its global business Need for low cost products Good communication with its

consumers and other stakeholders.

OPPORTUNITIES

Growing demand for greener products

Growing demand for low priced products.

Demand for reduced water usage and lower carbon footprints.

STEPS TO GRASP OPPORTUNITIES

Solutions for a sustainable life at home

Sustainable use of resources. Reducing carbon footprint. Developing social responsibility. Being open with all its

stakeholders.

THREATS

THREATS

Threats to IKEA may stem from: SOCIAL TRENDS – such as the slowdown in first time

buyers entering the housing market. This is a core market segment for IKEA products

MARKET FORCES – more competitors entering the low price household and furnishings markets. IKEA needs to reinforce its unique qualities to compete with these

ECONOMIC FACTORS –the recession slows down consumer spending and disposable income reduces

WAYS USED TO MINIMIZE THREATS

If a company is aware of possible external threats, it can plan to counteract them. IKEA uses its particular strength to defend

against threats in the market. Online help to guide customers to a more sustainable life

leads to control SOCIAL THREAT

Economies of scale leads to barriers to entry, by which MARKET THREAT was minimized

Low priced, good quality and design product offered by IKEA increases demand for product even in recession and in this way overcame ECONOMIC THREAT

SWOT’S CONTRIBUTI

ON

CONTRIBUTION OF SWOT ANALYSIS TO IKEA’S BUSINESS GROWTH

improve performance by reducing its weaknesses and using its strength

able to generate the strong growth by grasping opportunities available in market and by minimizing its threats.

retain a strong identity in the market.

SIMPLE RULES FOR SWOT ANALYSIS

Be realistic about the strengths and weaknesses of your organization or group.

Distinguish between where your organization is today, and where it could be in the future

Be specific: Avoid gray areas. Always analyze in relation to your core

mission. Keep your SWOT short and simple. Avoid

complexity and over analysis Empower SWOT with a logical conceptual framework.

CONCLUSIONIKEA is a well-known global brand in home furnishing with hundreds of stores across the world. It assess its external and internal

environment, which reveals its strength, weakness, key opportunities it can take advantage of and threats it must deal with. IKEA responds to both internal and external issues in a proactive and dynamic manner by using its strengths and reducing its weaknesses. IKEA’s passion combines design, low prices, economical use of resources, and responsibility for people and the environment. Through this, IKEA is able to generate the strong growth it needs to retain a strong identity in the market.

IKEA has discovered a business truth –Being sustainable and responsible is not just good for

customers and the planet, it is also good for business.