IKEA plans a multiformat push across six markets to quadruple revenue by 2030

Bangalore: IKEA India is looking beyond big-box stores to drive its next phase of growth, planning a multiformat expansion across six priority markets as it pursues a fourfold increase in revenue by 2030, its chief commercial officer Adosh Sharma told Mint.

The retailer is also counting on online sales and its business-to-business (B2B) segment, he added.

The company will open its second Bengaluru store on 5 November. The 80,000-square-foot outlet on Kanakapura Main Road will serve South Bengaluru.

“Bangalore is a serious market for us. We don’t plan to stop at two stores. We see scope for more and are actively scouting for locations,” Sharma said.

IKEA has identified six priority markets, including Bengaluru, Mumbai and the National Capital Region (NCR), where it plans to expand through multiple stores and formats. “We want to reach as many home furnishing customers as we can in these markets,” he said.

In July, India business head Patrik Antoni said IKEA plans to double its investment in the country to more than ₹21,000 crore by 2030.

IKEA India’s loss widened to ₹1,325 crore in fiscal year 2024-25 (FY25) from ₹1,299 crore a year ago, while operating revenue dipped 3.3% to ₹1,749 crore during the period.

Beyond big boxes

IKEA plans to combine large stores offering a full shopping experience with smaller outlets that bring the brand closer to customers in busy urban locations.

“The plan is to have the hub-and-spoke model, where you have one large store, which offers the full experience, and you have the smaller stores where interaction is more frequent,” he said.

The new Bengaluru store will offer more than 5,200 products, with over 3,000 available for immediate takeaway. More than 7,000 products can be ordered through the store, website, app and Shop by Phone service. The outlet will also have a 100-seater restaurant.

Online sales are another growth driver, with the digital business growing at a double-digit rate year-on-year and accounting for about 30% of IKEA’s business, Sharma said.

“Online continues to be our first point of entry into every new market,” he said, adding that the channel has further growth potential.

IKEA began its Bengaluru journey with e-commerce in 2021, opening its first store in the city in 2022. Bengaluru now has more than 900,000 IKEA family members, according to the company.

Multiple growth levers

IKEA’s 2030 ambition also rests on India’s economic growth and changing consumer attitudes towards home furnishing. “Home furnishing is not utilitarian. It is a lifestyle now,” Sharma said.

The company expects B2B to contribute to growth alongside online sales and store expansion. Sharma said the segment had grown at double-digit rates over the past two to three years. IKEA is also adapting its product range and mix to Indian consumers, with higher volumes expected to support its plans.

“These are the key levers we’re banking on to drive our expansion and growth,” he said, referring to market growth, new stores, online sales, B2B and product range.

Adapting to Indian households remains central to the strategy. Sharma said IKEA accounts for multigenerational families, homes with children and consumers’ focus on value for money. The Bengaluru store features solutions for compact apartments, multifunctional furniture and smart storage, as well as ideas for using balconies and terraces for gardening, hosting and relaxation.

“We are very conscious that we are always seen as an affordable, yet very inspirational brand,” Sharma said.

Pricing will remain important as households weigh discretionary spending. Sharma said IKEA had not raised prices since the West Asia crisis began and did not intend to increase them for now, although conditions remained delicate.

In kitchens, IKEA’s prices were 25-30% below those of some competitors, Sharma said, as consumers increasingly seek products that reflect their lifestyles.

“The market is large and growing, so there is room for everyone. And I think we’ll grow along with it,” Sharma said.

“Smaller stores can expand IKEA’s reach, but their success will depend on how effectively IKEA makes shopping more convenient while retaining the design, service and product experience associated with the brand,” said Nitin Jain, managing director, Protiviti Member Firm for India.

Affordability and design alone may not be enough to win customers if the shopping and fulfilment experience falls short of their expectations. IKEA will need to combine its product proposition with convenient shopping channels, reliable product availability and an efficient supply chain to respond to changing consumer needs, Jain added.