Ikea to open its first India store in Hyderabad, go online next year
05 Jul 2018
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Swedish home furniture giant Ikea is all set to open its first India retail outlet in Hyderabad, with plans to open its second store in Mumbai, when it will also launch online sales in the country.
The 400,000-sq ft facility of four floors with two floors of parking is getting final touches at Hyderabad’s IT hub and is set for a formal opening on 19 July, almost six years after the firm announced a major overseas investment programme.
Against the proposed Rs10,500 crore foreign direct investment proposed in the country, Ikea has so far invested Rs1000 crore in its Hyderabad facility.
During a preview of this store on Wednesday, Ikea’s India chief executive officer Peter Betzel said India was going to be a unique experience as the firm would look beyond large-format stores.
He said the company also expected the online pie in India to be bigger than the 6-7 per cent share it has been getting through online sales in a dozen countries so far.
The idea seems to be that a chain of smaller store to cater online sales would better suit Ikea’s India business.
“To buy a sofa you have to first sit on it. Touch and feel is very important for a customer to buy. But as online buying in every product area is growing, it will be so in furniture segment too. We will enter this channel next year when we open our store in Mumbai,” Betzel said.
Besides the large-format stores, which would come up in peripheral areas of large cities, and the online foray, the company would also look to set up small experiential stores of 10,000-50,000 sq ft in cities, depending on the business experience they are going to have in India.
Ikea, which home delivers products on a ‘do-it-yourself’ condition, has now set up a team to assemble furniture at customers’ homes for a price.
Ikea’s first India store, however, has a 20 per cent local content value. The firm plans to increase the value of local outsourcing to 50 per cent eventually.
