Seoul: Swedish furniture giant IKEA announced its plan to open its first outlet in Seoul and fifth in South Korea next month as part of its strategy to enhance sales in Asia's fourth-largest economy. The new outlet is scheduled to open on April 17 at the Gangdong IPARK THE RIVER complex cultural facility in eastern Seoul.
According to Yonhap News Agency, IKEA initially entered the South Korean market in 2014 with its first outlet in Gwangmyeong, located just south of Seoul. Currently, the company operates four outlets in the country, with the additional three situated in Goyang, Giheung, and Busan, all outside of Seoul.
The upcoming outlet in Seoul deviates from IKEA's traditional blue box store design, being located on the first and second floors of the facility. Isabel Puig, IKEA Korea's Chief Executive Officer, noted that the new store will be a key element of IKEA Korea's omnichannel strategy, aiming to bring the IKEA home furnishing experience both online and offline closer to Seoul's city center.
The Ingka Group, the largest IKEA franchisee based in the Netherlands, operates 400 stores across 31 countries. Globally, IKEA has a total of 481 stores in 63 markets. Despite a 5 percent decline in global sales to 39.6 billion euros in the fiscal year ending August 2024, IKEA Korea reported a shift to a net profit of 5.5 billion won, from a net loss of 5.2 billion won the previous year.
The company invested 10.5 billion won to reduce prices on 1,200 items at its Korean outlets in the 2024 fiscal year, which effectively boosted sales. Additionally, increased e-commerce transactions contributed positively to the financial results. The operating profit surged to 18.62 billion won from 2.59 billion won, while sales grew by 4.2 percent to 625.8 billion won from 600.66 billion won during the same period.