IKEA to double source euro 600 mn from India

The Dollar Business Bureau

Ikea said it will double source the products from India to nearly euro 600 million in coming three to four years. 

Juvencio Maeztu, CEO, Ikea India was speaking to reporters after the ground breaking ceremony, of IKEA India’s first store of nearly 4 lakh sq. ft with an investment of Rs 700 crore in Hyderabad. The Dy.Chief Minister of Telengana Govt, Mohammed Mahmood Ali and the State’s Chief Secretary Rajiv Sharma were present during the ceremony. The completed store is likely to be open in the autumn of 2017. The company has bought 13 acres of land in Hi Tec city, the software hub of Hyderabad. 

Ikea broke ground after nearly 3 years of bureaucratic wrangling in India. The Swedish furniture major had to patiently go through strict rules and laws to finally get the Govt’s nod to build its first store in India. Since IKEA stores are spread across huge acres of land usually 350,000 square feet, acquiring them in India became quite a challenge for the world’s largest furniture retailer. Unlike most investors in India, IKEA believes in purchasing the land instead of taking them on lease. This is IKEA’s way of saying, ‘we will be here for many years’ commented Maetzu. 

The 4 lakh sq ft store in Hyderabad, will have nearly 7500 products on sale, with a restaurant on site serving Swedish cuisine as well as Indian delicacies. IKEA is confident that the store would attract 5 to 6 million customers annually. The company plans to open 25 such stores in 9 Indian cities and has received official approval in 2013 to invest Rs 10,500 crore under direct FDI route. 

What is special about IKEA is that almost half of its workforce are women and has the policy of providing direct employment to 500 and indirect employment to 1500 of them. The store believes in making use of renewable energy source and plans to cover its roof top with solar panels to power its 3,000 kilowatts energy needs.