Ikea to spend US$71 million on expansion
PETALING JAYA, Malaysia (The Star/ANN) - Ikea, is looking to ramp up its investments and expansion in Malaysia by investing US$71 million by year-end.
Ikea, one of the world’s largest furniture retailer, is looking to ramp up its investments and expansion in Malaysia by investing RM300mil by year-end after investing RM2.1bil in the last three years.
The Swedish furniture retailer has invested about RM5bil since making its presence in 1996.
Ikea South-East Asia head of corporate communications Corinna Schuler told StarBiz that the RM300mil the company plans to invest would be channelled into Ikea’s Toppen shopping centre in Johor Baru hopefully before year-end.
The Toppen shopping centre is Malaysia’s first southern region shopping centre anchored by the first Ikea store outside of the Klang Valley.
Besides that, Schuler said it would be opening an additional 7,600 sq m of retail space directly linked to the Ikea Batu Kawan, which opened in Penang last March.
“We are also seeing a steady increase in our e-commerce business – up more than 16% across Ikea South-East Asia from last year.
“We are reaching customers who live thousands of kilometers from the nearest Ikea store – delivering across Peninsular Malaysia as well as East Malaysia
“This year our focus is on growth through the bedroom range.
“We are investing in showroom rebuilds and prices to inspire and enable Malaysians to make their most personal space a great place to wake up each morning, ” Schuler said.
According to Schuler, the company’s marketing team has a brand campaign in the works and would be developing Ikea’s presence in social media in new ways too.
All these initiatives has helped Ikea to have a wider reach, build its brand presence and grow its turnover, she said.
For the financial year 2019 (FY19), revenues from Ikea stores and shopping centres in Malaysia grew by more than 15% - up almost RM200mil from last year.
Schuler said the retailer would most definitely grow visitation and turnover in FY20 due to various actions on all fronts.
These include opening two new retail centres directly linked to Ikea stores, expanding its reach via e-commerce, developing touchpoints in Sabah and Sarawak, investing in memorable marketing and driving growth through its bedroom range.
“Our long-term focus is on families and people living with children – and that gives us fantastic potential for growth in a country like Malaysia.
“We help people create a better everyday life through an affordable range that helps people make life at home a little easier, more comfortable, more beautiful, ” she added.
In terms of market share, Schuler said Ikea is the market leader among home furnishing retailers in Malaysia and would be growing its market share year-on-year by embarking on actions on all fronts.
Towards this end, she said the retailer would be investing in new channels, leading with the lowest prices in the market, developing marketing media mix and, most importantly, inspiring customers to make home count.
Ikea South-East Asia is one of the 12 Ikea franchisees in the world that own and operate stores.