Swedish furniture giant Ikea is hoping to be a leading player in India's organised furniture segment as the company eyes 20% of the total market share.
"We aim to open 50 stores in the long run. By 2025, we should have 25 stores and touch points along with online presence,” Ulf Smedberg, Country Marketing Manager at Ikea Group, told BestMediaInfo.com.
The company may invest around US $2 billion in India.
"We aim to capture more than 20% of the organised sector in the coming years," he added.
According to a Euromonitor report, India's furniture market is around Rs 45,000 crore and is growing at 10% CAGR.
“A lot of our competitors are stressed in the short term of us coming and taking their market share, but what we see that interest will develop with us in home furnishing and the competitors will benefit from that,” Smedberg said.
The retail furnishing giant has been sourcing products from India for over three decades.
The brand kicked off its retail journey in India five years after it received approval to invest in the country's single-brand retail sector. The first store in Hyderabad has a floor area of 40,000 sq feet with 1,000 products on offer. The company is expecting annual footfall of around six million people in its Hyderabad store. It has also launched a 1,000-seater restaurant there.
Ikea has employed 950 people directly and another 1,500 indirectly at its store here and plans to hire 15,000 in the coming years as it expands operations in India.
After almost creating the euphoria at India launch, Ikea is gearing for its second store in Mumbai. Smedberg said that his immediate focus would be to maintain the momentum in Hyderabad and open stores in Mumbai and Bangalore.
“In India, people in general really love their homes. They invite people to their home. Ikea has so much to add to their homes. If you compare it with Korea, people don’t spend so much money on home. But in India, it’s a given and that helped us a lot in positive entry. Yes, we have come from Sweden, but we are embracing what India stands for,” he added.
According to Smedberg, Ikea will have a different approach for Mumbai compared to Hyderabad. “But, we will have the same kind of build-up, excitement and creating interest in the market.”
Instead of following its global do-it-yourself model, where people assemble furniture on their own at home, Ikea will be setting up separate assembly teams in India.