facts & figures The IKEA Group

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1 facts & figures The IKEA Group Facts & Figures produced in September 2005 by PR & Communications, IKEA Services AB. Printed on chlorine-free paper which meets the criteria of the Nordic Swan mark. Production cost: 0.5 euro. Picture on page 14: Hans-Jürgen Burkard (STERN Magazine).

2 OUR VISION To create a better everyday life for the many people. OUR BUSINESS IDEA To offer a wide range of well-designed, functional home furnishing products at prices so low that as many people as possible will be able to afford them. Now we focus on kitchens IKEA Group President Anders Dahlvig and Group Vice President Hans Gydell answer questions about IKEA. How have things gone for IKEA over the past 12 months? The IKEA Group has had yet another good year with sales rising by 15%. Sales across the entire bedroom range mattresses, beds, textiles and storage showed particularly good growth, as did restaurant operations and Swedish Food Markets. IKEA stores remained popular with customers and we welcomed a total of 410 million visitors. What about the Group s expansion plans? The IKEA Group opened a total of 18 stores last year, and five existing stores underwent major rebuilds. Most of the new stores (15 to be exact) opened in Europe, including two in Spain, three in Germany, three in France and two in Italy. The other three opened in North America. In spring 2006 we are moving into in a new market, Japan. That promises to be really exciting! The IKEA Group is planning to open a total of 19 stores in its 2006 financial year. What were the main newcomers to the range? IKEA went big on bedrooms, launching a complete, coordinated collection that offers customers everything they need for this part of their home. A new mattress range, with four different types of mattresses, has given customers a better choice. This, together with smart storage solutions and a new, broader range of textiles has been well received on all markets. What new products does IKEA have in the pipeline for next year? We will continue to focus on bedrooms. But another area that we will be spotlighting is kitchens. We want to make life in the kitchen easier! To be able to offer customers all they need for this function in the home, we ve developed a wide range of coordinated kitchen and dining room furniture, together with all sorts of new tableware, cutlery, glasses, textiles and lighting in different styles and price ranges. What goes inside is also important to us smart, simple storage ideas and safe, family-friendly solutions. And now we can also offer more help with planning and installing kitchens. What s more, we will continue to reduce prices right across the range. Is it possible for IKEA to be a responsible company that shows respect for people and the environment at the same time as it sells low-price products? Yes. It s not always easy, but there s no conflict between good business and good companies. We do our utmost to sell our products at the lowest possible prices but not at any price! We work pro-actively with environmental and social issues, taking responsibility for our products all the way down the line from the material they are made from, to how they are manufactured, transported and, ultimately, recycled. We ve come a long way already, but there s always more to be done. 2 3

3 IKEA IN FIGURES Sales for the IKEA Group for the financial year 2005 (1 September August 2005) totalled 14.8 billion euros (135 billion Swedish kronor). Sales Sales by region Asia + Australia 3% Purchasing by region North America 3% 12.8 North America 16% Asia 30% Europe 81% Europe 67% Figures in billions of euros. Co-workers by region Co-workers by function Top five sales countries Germany 19% USA 11% United Kingdom 11% France 9% Sweden 8% Top five purchase countries China 18% Poland 12% Sweden 9% Italy 7% Germany 6% Asia + Australia 3,000 North America 13,000 Retail 69,000 Industrial production Swedwood Group 13,000 Europe 74,000 Purchasing, distribution, wholesale, range and others 8,

4 HOW IKEA IS ORGANISED The founder of IKEA, Ingvar Kamprad, has been eager to create an ownership structure and an organisation that safeguard long-term independence. Stichting INGKA Foundation The Foundation The IKEA Group is owned by a foundation, Stichting INGKA Foundation, which has its registered office in the Netherlands. IKEA Services B.V. IKEA Services AB Inter IKEA Systems B.V. INGKA Holding B.V. The IKEA Group The Parent Company The foundation owns INGKA Holding B.V., which is the parent company for all the companies in the IKEA Group. INGKA Holding B.V Supervisory Board: Hans-Göran Stennert (Chairman), Jan I Carlsson, Peter Kamprad, Göran Lindahl, Carl Wilhelm Ros, Bruno Winborg, Magdalena Gerger. Ingvar Kamprad (Senior Advisor). The IKEA Group consists of a large number of companies from the Swedwood industrial group to the sales companies that own the stores in the various countries. IKEA Group Management: Anders Dahlvig (Group President), Hans Gydell (Group Vice President), Josephine Rydberg-Dumont, Mikael Ohlsson, Werner Weber, Peter Högsted, Ian Duffy, Pernille Lopez, Lars Gejrot, Sören Hansen, Göran Stark. Work within the IKEA Group is supported by a total of nine staff units in the Netherlands (IKEA Services B.V.) and Sweden (IKEA Services AB). Inter IKEA Systems B.V. owns the IKEA concept and trademark, and has franchising agreements with every IKEA store in the world. The IKEA Group is the biggest franchisee. Industry Swedwood Group Purchasing Distribution and wholesale Range IKEA of Sweden Retail 6 7

5 Everything under one roof 2006 will see many new developments at IKEA. The main focus will be on kitchens and bedrooms, but there will be new products throughout the range. One example is the new PS collection, with exciting, innovative products inspired by ideas collected from all over the world. I guess it was the rebel in me that inspired me to design a chair you can actually lean back in and rock on. It s all made out of the same material, without any screws or extra fittings. CHRIS MARTIN ON IKEA PS ELLAN BEDROOMS IKEA has brought together everything for the bedroom, all under one roof. Beds, mattresses, pillows, quilts, bedspreads, curtains, mirrors, lighting, and, last but not least, smart storage. Here s all you need to create your dream bedroom! KITCHENS IKEA wants to make life in the kitchen easier and more fun. We have lots of new cabinet doors in different styles, storage solutions to make cooking simpler, practical utensils, exciting new glasses and tableware, and coordinated dining room furniture. High quality at a low price for the many people! 8 9

6 IKEA IN THE WORLD The IKEA Group has 90,000 co-workers and operates in 44 countries. Meeting the customer STORES IKEA stores stock everything for the home, all under one roof: sofas, beds, tables, chairs, textiles, kitchen utensils, flooring, rugs, kitchens, bathrooms, lamps, plants... By displaying the range in room settings, we aim to inspire customers with ideas and share hints and tips about smart, new solutions. Last year 410 million customers visited our stores. There is a total of 220 IKEA stores in 33 countries/territories. The IKEA Group owns 196 stores in 24 countries (on 31 August 2005). The other 24 stores are owned and run by franchisees outside the IKEA Group in the following 15 countries/territories: Australia (1), United Arab Emirates (2), Greece (2), Hong Kong (4), Iceland (1), Israel (1), Kuwait (1), Malaysia (1), Netherlands (1), Saudi Arabia (2), Singapore (1), Spain (3), Taiwan (2), Turkey (1) and USA (1). THE CATALOGUE is our most important marketing channel. Last year 160 million copies were printed in 52 editions and 25 languages. THE INTERNET is being used by more and more people as a source of information. Last year the IKEA website attracted 125 million visits worldwide. Internet business accounts for a small but ever increasing percentage of total IKEA sales. The new store in Atlanta, USA, opened in July Our stores from Älmhult and out across the globe The IKEA Group has 196 stores throughout the world. Over the coming twelve months 19 new stores are scheduled to open. ÄLMHULT 1958 the very first IKEA store opens in Älmhult, Sweden. NORWAY 1963 the first IKEA store outside Sweden opens in Slependen, Norway. SWITZERLAND 1973 the first IKEA store outside Scandinavia opens in Zürich, Switzerland. USA 1985 the first IKEA store opens in the USA (Philadelphia). CHINA 1998 the first IKEA store opens in China (Shanghai). RUSSIA 2000 the first IKEA store opens in Russia (Moscow). PORTUGAL 2004 the first IKEA store opens in Portugal (Lisbon). For a full list of IKEA stores in each country see:

7 IKEA in the world IKEA of Sweden in Älmhult, Sweden, develops the IKEA range. This is the same for IKEA stores all over the world and consists of around 9,500 articles. The basic thinking behind all work with the range is to use low prices to make well-designed, functional home furnishings available to everyone. Products designed by in-house and external designers are analysed while still on the drawing board to ensure they meet requirements for function, efficient distribution, quality, the environment and low price. IKEA of Sweden also gives each product its unique name, such as BILLY and KLIPPAN. INDUSTRIAL OPERATIONS The Swedwood Group is an industrial group owned by IKEA. Swedwood produces woodbased furniture and wooden components in 35 industrial units in nine countries. PURCHASING OPERATIONS IKEA has 46 trading service offices in 32 countries. Co-workers in each office monitor production. This enables them to test new ideas, negotiate prices and check quality while keeping an eye on social and working conditions among suppliers. Being close to our suppliers around 1,300 in 53 countries is the key to rational, long-term cooperation. DISTRIBUTION OPERATIONS The route from supplier to customer must be direct, cost-effective and environmentally friendly. Flat-packs play an important role in achieving this goal. IKEA has 28 distribution centres in 16 countries that supply goods to IKEA stores. ENVIRONMENTAL AND SOCIAL RESPONSIBILITY IKEA invests a great deal of effort to ensure that adopting a responsible attitude to environmental and social issues is a natural part of the Group s day-to-day work. You can read more about this in the report IKEA Social & Environmental Responsibility, available via the internet on 31% of people who say they can t get a good night s sleep have never changed their mattress. 153,000 visits a day were made to the IKEA website in ,000 people turned up for the inauguration of the IKEA store in Shanghai. 3.9 visits a year are made by the average European customer to an IKEA store. 4 million BILLY bookcases were sold in minutes a day is the average time spent sleeping by an adult

8 Simplicity is a virtue THE NAME IKEA comes from the initials of the founder, Ingvar Kamprad, the farm, Elmtaryd, and the village, Agunnaryd, where he grew up in the rural province of Småland in southern Sweden. Ingvar was only 17 when he registered the IKEA name and embarked on a career selling ballpoint pens, Christmas cards and packets of seeds. Five years later he introduced the first furniture into the range in the form of RUT armchair. These humble origins have created a unique IKEA culture founded on respect for money, an innovative mindset and the courage to assume responsibility. NO ONE HAS DONE MORE to develop this culture than Ingvar Kamprad himself. He retired as Group President in 1986, but continues to work tirelessly for the company as Senior Advisor. He is also a critical store customer, a watchdog for the IKEA concept and quality, a visionary and a constant source of inspiration. INGVAR KAMPRAD HAS always had great faith in human nature and our ability to change and create. One of his rallying cries, What we Ingvar Kamprad chats to co-workers at the IKEA store in Moscow, Russia. No one has made more mistakes than I have. want, we can and will do. Together. A glorious future! (from The Testament of a Furniture Dealer written in 1976) is a familiar maxim among IKEA co-workers. HIS LIFE S WORK has contributed greatly to the IKEA vision to create a better everyday life for the many people a vision that is firmly founded on a unique blend of humanitarianism and capitalism. Although the farmer s son from Småland is today celebrated and acclaimed worldwide as an entrepreneur, fame has not tempered his enthusiasm for making sure every customer gets a good deal at IKEA. His instinct for practical details is peerless and complemented by an impressive insight into furniture design and manufacture. He himself has said, No one has made more mistakes than I have. Self-criticism, humility and the ability to compensate for one s own shortcomings form the foundations for the IKEA culture, personified by Ingvar Kamprad himself