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  • Essay / Strategic Business Analysis: Ingvar Kamprad and IKEA

    Careful planning for entry into a new market paved the way for IKEA's rapid growth in other countries. To facilitate expansion, IKEA was reorganized into four geographic regions: however, purchasing, distribution and design functions were centrally controlled. The senior management was Scandinavian and followed a simple, people-oriented philosophy. Armed with a strong management team, Kamprad purchased a bankrupt IKEA franchise in Canada, making it profitable in just three years. The venture into the world's largest furniture market, the United States, was part of IKEA's Canadian operations. Even before the stores opened, the company faced competition from copycat stores like Stor that opened in California. The retailer copied IKEA's concepts so much that IKEA had to take legal action against them. In 1989, IKEA stores opened in Philadelphia, Washington, Baltimore and Pittsburgh with several more expected to open in 1992 (Bartlett & Nanda,