IKEA Philippines to make products 'more affordable'

Ikea Philippines is looking to continue growing its top line this year while also focusing on making its products more affordable for its customers in the country moving forward.

According to IKEA Philippines country retail manager Gerard Jansen, the firm was looking at a modest growth of 4% to 5% this year after it recorded an P8.7-billion turnover in the financial year that ended on August 31, 2023.

“Of course we expect growth, but given the challenges, it’s a modest growth that we have actually budgeted for 2024 because we have started seeing that at the tail end of 2023,” he said in an interview with GMA News Online.

“We also in a way, you know, realized that there has been some buying behavior changes. What COVID has done is made a lot more people familiar to buy online products that they otherwise would not have if there was no COVID,” he added.

Among the factors that Jansen cited are the higher costs, along with the elevated inflation rates in the country with the February print recorded at 3.4%, faster than the 2.8% in January.

“You know, everywhere right, there’s no escaping, IKEA or otherwise, there’s no escaping the challenges, the global challenges that most businesses are facing,” he said.

IKEA Philippines currently operates the largest IKEA store in the world located in Pasay City, which recorded some 17 million visits during the previous financial year, based on reports by IKEA Retail.

Jansen said IKEA Philippines’ online business has been “going very well,” with double-digit growth so far year-to-date. It has also opened up more collection and delivery points across the country.

“We focus on making sure that each Filipino household or as many Filipino households as possible can afford good quality, well-designed and sustainable produced and distributed, I would say, products at the lowest price possible for us,” he said.

“Sometimes, I think we are constrained by increasing cost prices. Then we have to remain compliant to local regulations and make sure that we price above those cost prices. But if it allows a way, it allows us, we have and we will continue in this journey,” he said.

IKEA Philippines is also set to mark down prices of more products and services starting in April, which could include essential products such as study desks, beds, and mattresses.

In terms of its expansion plans, Jansen said IKEA will be focusing on reaching more customers through its online platforms and making prices more affordable for the Philippine market.

“It’s not so easy to look for ideal locations at the right cost and things like that, so actually, it’s not like we don’t have plans or we’ve not been keeping our eyes or ears open,” he said.

“If a fantastic deal comes, of course, that’s a different story, but as far as plans are concerned, and you know, the approach is concerned, yes, it won’t be in the near future,” he added.

The firm earlier said it was looking to open more branches across the country in the coming years, with Baguio, Cagayan de Oro, Cebu, Davao, and Iloilo as possible areas for expansion. — DVM, GMA Integrated News