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Swot Analysis of Ikea

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SWOT Analysis of IKEA

Section I - Organizational History

IKEA is a company with a very unique business strategy that has given it its strengths for its success today. However, like all strategies, IKEA's strategy has its own flaws that can pose as weaknesses. IKEA also has a lot of opportunities in the marketplace such as expansions of their company and threats such as competitors competing in the same industry.

The IKEA vision is to create a better everyday life for the many people. This includes doing what we can to help create a world where we take better care of the environment, the earth's resources, and each other. We know this continuous improvement is a never-ending job, and that we are sometimes part of the problem. But we work hard to be part of the solution.

Section II - Strengths and Weaknesses


Beside the company's vast locations being served the company has been successful in targeting its key consumers because of consistency in lots quality being served. The vision of the company is very well defined, that is for the betterment of everyday life of people. A wide range of products with respect to deigns as well as range at relatively affordable cost. The Ikea's cost consciousness' design is specially taken into account while introducing new design or variety. Special monitoring guidelines are followed by IKEA and are expected from its suppliers as well. The monitoring is done for evaluating the customer's responses as well as supplier's performances regarding sales and attitudes towards purchasers. IKEA is linked to the environment sustainability and as a proof it uses almost 75 % of the renewable material in its products. Along with that the waste products are being considered for energy production, producing 90% of energy through this material; that may otherwise be wasted. IKEA values its suppliers and extends its support to the maximum level for attainment of the long term partnerships even by lowering the prices to the maximum level. The source and supply change are in coordination with each other maintaining the minimum possible distance between them. To reduce the travelling pollution IKEA directly supplies the products to the stores from the supplier location.


Even as an international brand there is a level of reliance on European markets with 90% of the stores based in Europe and the balance across America, Middle East and Asia.

The company is highly dependable upon the subcontracted manufacturers as its own manufacturing capacity is not up to the demand. The dependability also compromises the quality standards as the quality of products is not homogeneous at every location.

The demographic locations are not evenly distributed Europe being its main hub, and at the time of crisis in Europe the profits would be highly endangered. Although the discounts are often provided but the services are not included in the packages, so the complete shopping experience needs to be introduced. The Ecommerce, which is need of the hour, is not being worked on and the customers are not able to compare and decide its products without being physically present at the outlets.

Section III - Opportunities and Threats





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