In what could give a stiff competition in the furniture market, Swedish furniture maker IKEA could trigger a price war in India’s USD 49.5 billion home furniture and furnishings market.
The first 400,000 square feet IKEA store in Hyderabad, which will offer about 15% of its products at Rs 200 or less is all set to open in July. According to a Hindustan Times report, the world’s largest furniture retailer is set to reduce prices further to attract to a wider Indian audience.
“We are very confident that we will enter the market with the lowest possible prices. There will be 1,000 products at prices below Rs 200 when we open our store,” Ikea India’s Maharashtra market manager Per Hornell was quoted as saying from the HT.
However, the company is not in a hurry to expand its footprint in India. The second IKEA store in the financial capital Mumbai is expected to be launched only in mid-2019. Surprisingly, IKEA, known for its physical stores and not for a serious digital presence, is expected to launch its online store following the Mumbai launch.
The company will also launch home furnishing consultancy, wherein customers can request home visits for personalized references.
Ikea, which has a range of do-it-yourself (DIY) products, recently announced a tie-up with mobile-based services platform UrbanClap as its furniture assembly service partner for the Hyderabad store.
As part of this collaboration, consumers purchasing a select range of IKEA furniture from the store will be able to book furniture assembly services via the UrbanClap app or the website.
To further strengthen the services, offer, Ikea will also have an in-house team of 150 assemblers, of which today 75 are women in line with the commitment to have 50 per cent women co-workers at all levels in Ikea India.
The Indian home furnishing and furniture market is expected to see compounded annual growth of 13% between 2016 and 2021, according to consultancy firm Wazir Advisors.
Between September 2016 and August 2017, Ikea Group’s revenues grew by 1.7% to €36.3 billion, according to its annual summary report.
Meanwhile, it seems Indian furniture market will witness a spurt of foreign industries. Italian fashion and lifestyle major Gianni Versace is planning to bring its furniture range in India to tap the fast-growing luxury market. At present, furniture is the only product category in Versace’s portfolio that is not available in India.
“We are looking at launching the furniture range. We have no reason why we shouldn’t,” Gabriella Saracino, Worldwide Licensing and Home Division Director, Gianni Versace SpA told PTI. However, no details on the timeline of the project has been shared by her.
According to a PTI report, Versace would be partnering locals for the distribution process for the furniture range, whereas, the production would be in Italy.
