IKEA is a multinational group founded in Swedish but based in Dutch and specializes in designing and selling ready to assemble furniture, kitchen appliances and home accessories. IKEA was established in 1943 and has grown its stature to one of the largest furniture retailer. The company’s vision is to create a better everyday life for the many people. The company strives to achieve this through its business idea that is to offer a wide range of well-designed, functional home furnishing products at a low-price range that is affordable by many people. He company has earned its spot for its modernist designs for different appliances, furniture and interior designs (Tarnovskaya & Chernatony, 2011). Its products and designs are all eco-friendly. The company strives to offer the products at affordable prices through different value-chain optimization strategies such as establishment of long-term supplier relationship, investment in automation of production cycle and large-scale production. The IKEA group is composed of Stitching Ingka Holding B.V and other controlled entities. Ingka Foundation is the owner and contributes funds that can only be used for reinvestment in the company or carry out charity functions. To gain a better understanding of the company, this paper conducts an external analysis, Porter’s five-point model and internal analysis of the company. The external analysis focuses on gaining an understanding how the external factors such as political, economic, and legal factor affects the operation of the company. The Porters five forces Model discussed allows an analysis of the company and allow a comparison with the competitors. The internal factors whose effects have been considered include the resources, capabilities, and competitive advantage.
Veronika V. Tarnovskaya, Leslie de Chernatony, (2011) “Internalizing a brand across cultures: the case of IKEA”, International Journal of Retail & Distribution Management, Vol. 39 Issue: 8, pp.598-618
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