Swedish furniture chain Ikea is still holding on to its prediction of doubling turnover by 2020. To manage that type of increase within 8 years, the yearly turnover would have to increase 10 % each year. Past fiscal year however, the growth was only 3.1 %.
Slow economic growth is cause
"Our goal has so far proved to be too aggressive”, Göran Grosskopf has said to Swedish business paper Dagens Industri. Grosskopf represents Ingka Holding, Ikea’s parent company. “Sales haven't developed as fast as we thought.”Ikea blames the slower turnover growth in its latest fiscal year on the slower economic growth, mainly in South Europe.
That does not mean that Ikea will let go of its ambition, even though Grosskopf is taking into account that the goal may only be reached in 2021. An Ikea representative has confirmed the statement: “We continue to work according to our ambitious growth strategy”.
Grosskopf denies he wants to slow down the plans after founder Ingvar Kamprad had critisized Ikea’s plans to open 25 new stores per year.The founder is currently 87 years old and while he has limited real power within Ikea, his words still have some effect within Ikea’s management.
(Translated by Gary Peeters)