IKEA to open smaller stores in India, expand online presence
IKEA, the world's largest furniture retailer, is preparing for its second phase of growth in India. The company's CEO for India, Susanne Pulverer, revealed plans to open smaller format stores and enhance its online presence. These new outlets will range from 30,000-70,000 square feet, and will be located near existing or upcoming large-format stores in the country.
Next stop is Delhi-NCR
IKEA's next target is Delhi-NCR, where it plans to initiate online sales in Q1 2025. This will be followed by the launch of a physical store at its first 'Lykli' center in Gurugram in 2026. Currently, IKEA operates large-format stores in Hyderabad (4.8 lakh sq ft), Navi Mumbai (5.3 lakh sq ft), as well as Bengaluru (4.6 lakh sq ft). It also had two small city centers in Mumbai, one of which has since closed down.
Future expansion plans in India
Pulverer acknowledged the challenges posed by high land costs and interest rates in India. However, she expressed IKEA's commitment to finding cost-effective solutions. The company is considering sourcing more local products to improve gross margins. In 2013, the Indian government approved a ₹10,500 crore FDI proposal from IKEA, for setting up 10 stores with allied infrastructure over a decade.
IKEA's focus markets
IKEA has identified six key markets in India: Hyderabad, Mumbai, Bengaluru, Chennai, Delhi, and Pune. The company plans to gradually expand into neighboring cities due to logistical considerations. Pulverer stated that Delhi will be a significant market in the second phase of expansion. Smaller format stores are also being considered for areas surrounding Delhi-NCR and cities like Chandigarh.
IKEA's parent company invests in India
Ingka Centres, part of the Ingka Group that operates IKEA retail, has invested €607 million (around ₹5,500 crore) to establish its second center in Noida under the Lykli brand. This center is expected to be operational by 2028 and will house an IKEA store. Sebastian Hylving from Ingka Centres confirmed their interest in adding more such meeting places in India, aligning with IKEA's expansion plans.
