Hyderabad's IKEA store sold more despite lower than anticipated footfall

  Written by : IANS Updated: Fri, Feb 01, 2019, 02:48 PM
 

Hyderabad: Swedish home furnishing multinational IKEA's first India store here witnessed less than expected footfall during last six months but the spending by the buyers was more than what it anticipated, said a top company official on Thursday.

IKEA'S Hyderabad store, which opened in August last year, said it was originally looking for 7 million footfall a year but it is now 5 million a year.

"The ambition was to have more footfall. We imagined higher visitation but the same time we see many positive categories. People are buying more items and they are spending more money. We are selling more pieces. This is good for IKEA because we are volume driven company. They are spending and buying more than we anticipated," said John Achilles, Hyderabad Store Manager, IKEA India.

He told reporters that products with a volume of 80,000 square metres were sold but declined to share the numbers in terms of value.

Terming the people's response as amazing, Achilles said it was a great learning experience. "We learnt so much about market, so much about customers and about their buying habit."

According to Achilles, customers in India were price sensitive. "Low priced items are those selling in much higher volumes. People want great value for money for products both accessories and furniture."

Kallas spoon set, priced at Rs 15, the lowest at the store, has been the number one selling item during last six months. "We sold half a million of those in six months. There is no other store in the world that sold this kind of volumes," he said.

He said IKEA's range of products were lowest in many categories in the market. While 95 per cent of the products sold in India were the same available at IKEA stores around the world, about five per cent were specifically meant for India. These products included spoons, "tawa" and other accessories.

Achilles was talking to reporters on the sidelines of the launch of made in India textile collection, Anglatarar, by by IKEA. 

IKEA opened first store five years after the world's largest single brand retailer received government approval in 2013 to invest Rs 10,500 crore to open 25 stores in India by 2025. The company last year revised the number of stores to 40 across all formats. 

Achilles said they would open the next store at Mumbai during 2019 while Bengaluru store would come up in next 24 months and this would be followed by New Delhi.

On sourcing from India by IKEA, he said this had gone up to 19 per cent while it was less than 10 per cent before the launch of first store. 

The sourcing has to go up to 30 per cent in five years as prescribed by the government of India, the official said, adding that they were looking to go beyond 30 with ambition to reach 50 per cent.

Mia Olsson, Country Communication and Interior Manager, IKEA India, said: "This collection mark the celebration of design aesthetics from both countries". She termed it as a tribute to India.