The world number one in furniture Ikea announced on Thursday a drop of 5.3% in its turnover to 45.1 billion euros for the 2023/2024 financial year, ended at the end of August, due to its policy falling prices.
This result is explained “mainly by the drop in prices”, explained Inter Ikea, the group’s main holding company, in a press release. It was obtained against the backdrop of “a struggling global economy and a declining furniture market.”
After having had to announce in December 2021 a rare increase in its prices, of 9% on average due to inflation, the Swedish giant undertook in September 2023 to reduce its costs to lower its prices, with the hope of stemming the decline in its sales volume.
“Following price cuts, Ikea saw an increase in store footfall (+4.5%) and online visits (+21%), while volumes increased due to growing consumer demand,” he indicates.
The Ingka group, which brings together most of the Ikea stores in the world and represents more than 90% of its total turnover, specifies that it has invested 2.1 billion euros in this price reduction.
“It was the right thing to do, to invest 2.1 billion euros to bring Ikea closer to our vision of creating a better daily life for many people whose purchasing power has diminished” with the inflation, Tolga Öncü, Ingka’s operations director, told AFP.
Ikea approaches 2025 with confidence thanks to the prolonged effect of lower prices, easier access to its products, whether online or thanks to new store formats, specifies Mr. Öncü. “We approach fiscal 2025 with optimism,” he says.
Ikea will publish its full results for the financial year at the end of the year.
This article was automatically published. Sources: ats / awp / afp
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