IKEA Notes Sales Decline As It Prioritises Lowering Prices

Ingka Group today announced its share of IKEA retail sales of EUR 39.6 billion[i] for the financial year 2024[ii], a decrease of 5% compared to last year (EUR 41.7 billion in FY23). The company has prioritized lowering the prices to customers by investing more than EUR 2.1 billion across thousands of products across all markets. This led to an increase in store visitation by more than 3% and online visitation by 28% while the number of online orders went up by 9%.

In a year marked by economic uncertainties with higher interest rates and increasing inflation as well as a declining home furnishing market (-3.8%), Ingka Group, the largest IKEA retailer, has focused on lowering the prices to customers and reigniting growth by creating a more affordable, accessible and sustainable IKEA.  

“We are in times when dreams and needs for a better life at home are greater than ever. At the same time, inflation and interest rates have impacted on people’s wallet and when times are challenging for people, we want to support in the best possible way. Investing into lowering our prices is our long-term promise and this has been a year where the strength of the IKEA vision, our togetherness, and our entrepreneurship lived up to the test of time,” said Jesper Brodin, CEO, Ingka Group.

At the same time, Ingka Group continued to deepen its market presence and reaching more people by investing over EUR 1.3 billion in revamping existing stores, expansion, and digital development. The retailer opened 43 new locations across the world, including new stores in Japan, Switzerland, and China, as well as plan and order points in the US and Italy, among other places, allowing customers to plan their dream home and order any IKEA product. To further improve customer experience, the company rolled out new fulfilment solutions and artificial intelligence driven technology, such as tools for faster pick-up and deliveries, self-service digital kiosks for locating products in the stores, and demand sensing solutions for better availability of articles. This has led to achieving the highest score in customer satisfaction since the retailer started measuring it five years ago.

“It has never been so important to be as affordable as possible – that’s why we’ve dedicated our energy and resources to lowering our prices. At the same time, we kept investing in developing and innovating our retail business, bringing our existing stores to the best shape ever, while securing good value for money and further improvements to our digital solutions and services,” said Tolga Öncü, Ingka Retail Manager (COO), Ingka Group.

The IKEA ambition is to deliver to the Paris Agreement and become net zero by reducing absolute greenhouse gas emissions from the entire value chain up- and downstream, by at least 50% by 2030 and 90% by 2050. The company has accelerated its investments into renewable energy and is committed to invest EUR 7.5 billion until 2030, where more than EUR 4.2 billion has already been invested to accelerate the transition to a net-zero society.

Inter IKEA Systems B.V., which is the owner of the IKEA concept and the worldwide IKEA franchisor, today announced total IKEA retail sales of EUR 45.1 billion across all 12 groups of franchisees, where Ingka Group represents 88% of the total sales.

Key figures:

• Total IKEA Retail sales: FY24: EUR 39.6 billion (-5%), FY23: EUR 41.7 billion (+5.7%)
• Global market share: FY24: 5.7%, FY23: 5.7%
• Online share: FY24: 28%, FY23: 26%
• Store visits: FY24: 727 million visits (+3.3%), FY23: 697 million visits (+4%)
• Openings: FY24: 43 locations, FY23: 60 locations
• Since 2016, Ingka Group has grown by 30.9%, while achieving a -24.3% climate footprint reduction
• 583 wind turbines, 26 solar parks and + 1 million solar panels on the roofs of IKEA units

Full financial result will be issued end of November and more comprehensive Annual Summary and Sustainability Report will come in end of January.

[i]  The (financial) information in this press release is unaudited, Ingka Holding’s audited financial statement will become available through the Dutch Chamber of Commerce.

[ii] Fiscal year: 1 September 2023 – 31 August 2024.

Source : Ingka Group

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