IKEA has finally opened its much awaited first retail store in India (50th country in the world) at Hyderabad on August 9, 2018. The world’s largest furniture retail store chain’s Hyderabad store is spread in nearly 4 lakh sq ft with built in three story building and a huge parking space in the basement. The store when opened, most of the visitors were from Hyderabad, its out skirts and some of them had travelled from nearby states like Maharashtra, Karnataka, Andhra Pradesh, Tamil Nadu etc. IKEA has 400 stores in 50 countries across the world.
Local furniture manufacturers and traders are alert with the entry of IKEA to their territory. They are moving strategically by offering products to the customers’ choice and on their price points unlike the giant store has fixed price policy. They are also confident that with the market expansion and increasing competition as they are ready to face the shift that will emerge from this change.
Many of the local players are observant that the market expansion and competition will increases customers’ base which will offer space for everyone. Besides, they are also calculating nearly 20% shift in sales. According to an estimate India’s indoor furniture market is set to reach at Rs 70,000 crore by 2022 supported with ongoing affordable housing projects and government initiatives towards their ambitious housing for all by 2022 scheme. The data revealed by the report of the survey conducted by the team Ply Reporter among nearly 3000 local furniture manufacturers and traders indicate that most of the manufacturers and traders specially in mass market segments like office, plastic and modular furniture makers in Telangana region are observing that IKEA operation will definitely impact in the long run.
As of now there is no apparent impact on their sales as the items at IKEA store are priced extremely low that likely to drive their business, the only disadvantage is that the most IKEA customers are not familiar with its do-it-yourself concept but for them IKEA is offering paid on assemble service in association with UrbanClap, a local start up dealing in furniture and its repairing. IKEA’s products range in India spans from plastic spoons worth Rs 15 to navy-blue suede couches costing over Rs 1 lakh.
The IKEA store has been designed in a way that pushes the visiting customers towards first floor where the showroom and display of the products have been placed. According to media reports around 40,000 people had visited at this giant store at Hyderabad that had been under construction for over two years. The store also contains a 1,000-seater restaurant which had observed a larger part of their sales on the inaugural day. The Ply Reporter will keep the readers updated with further reports on this subject on this issue.