INSUBCONTINENT EXCLUSIVE:
IKEA aims to soon open a 400,000 square feet store in Hyderabad
(AFP)Mumbai, India: Furniture giant Ikea is set to open its first store and restaurant in India after years of
trying but arguably its most famous item is off the menu -- Swedish meatballs.Ikea, the world's biggest furniture retailer, will next month
cut the ribbon on a massive 37,000 square metre outlet in the southern city of Hyderabad, complete with a 1,000-seater cafeteria.The
restaurant will be Ikea's largest and will cater to local tastes, with religious sensitivities in India dictating that beef and pork,
staples of Swedish meatballs, will not be served."There will be chicken meatballs and vegetarian balls," Patrik Antoni, Ikea's deputy
country manager for India, told AFP during an interview in the Indian financial capital of Mumbai."Fifty percent of the food will be Swedish
inspired, salmon and shrimp dishes and so on
We'll also have quite a few Indian dishes like dal makhani, biryani, samosas," he added.The Swedish multinational, which revolutionised
household furnishings with its range of affordable ready-to-assemble products, is betting big on India as it seeks new revenues away from
its key Western markets.Ikea plans to invest $1.5 billion in Asia's third-largest economy as it seeks to lure price-sensitive Indians away
from satisfying their furniture needs at local, family-run shops.Ikea has already spent close to $750 million procuring sites for four
stores, including the Hyderabad one which will open in July on a date that is yet to be announced.Outlets in Mumbai, Bangalore and the
capital New Delhi will follow, Antoni said, without putting a timescale on them
He added that Ikea will then look at Pune, Chennai, Ahmedabad, Surat and Kolkata."We are very bullish and excited about the Indian market
Normally, we would test a market by opening one store but in India, we are going all out and expanding," said Antoni.At 37,160 square metres
the Hyderabad store will be comparable in size to an average Indian shopping mall
It will have 850 employees and is expected to attract several million visitors a year. The under-construction site of an IKEA store in
(AFP)Spice and all things niceAs well as its wide range of international items Ikea will also sell goods uniquely suited to the Indian
market.Alongside its popular Billy bookcases and Poang chairs, Ikea will also offer spice boxes and kitchen appliances to make traditional
Indian staples such as idlis (rice cakes)."We have done over a thousand home visits and interviewed people to try to understand their needs,
dreams, aspirations and how they feel about their home," explained Antoni.More than 1,000 products priced under 200 rupees ($2.94) will be
on sale.India, with its abundant supply of cheap labour, is not known for its "DIY" culture so Ikea has teamed up with UrbanClap, an online
platform that helps connect handymen with consumers.Ikea, founded in 1943 by late Swedish entrepreneur Ingvar Kamprad, operates 418 stores
In May it announced that it would expand into South America with stores in Chile, Colombia and Peru.The home goods behemoth first tried to
enter India in 2006 but was foiled by strict foreign direct investment (FDI) rules that required foreign companies to sign up with a local
partner.Seven years later the rules were relaxed to allow foreign businesses to own retail stores operating under a single brand, clearing
the way for Ikea's entry into India.The Swedish company hopes its walk-in stores and famed restaurant will be a unique selling point as it
goes up against popular Indian online furniture retailers Pepperfry and Urban Ladder. It will also have to contend with Walmart
The world's largest retailer has agreed to buy a majority stake in Indian e-tailer Flipkart, which sells a wide range of home
furnishings.Ikea's global sales grew by five percent on-year in 2017 as it recorded annual revenues of 38 billion euros ($47 billion).The
firm hopes access to India's growing middle class in the country of 1.25 billion people will open up new revenue streams.Analysts, however,
warn it faces a long journey in a crowded market."Profitability will take some time for Ikea in India," Sowmya Adiraju, an analyst at
research firm Euromonitor, told AFP. (Except for the headline, this story has not been edited by TheIndianSubcontinent staff and is
published from a syndicated feed.)
