It promises the same quality and range worldwide 2. its vision – ‘to create a better everyday life for many people’ 3. a strong concept – based on offering a wide range of well designed, functiona… This would lead to a huge reduction in cost. The brand put all the products at an affordable rate for their customers through their entire value chain optimization, investing in a highly automated production, and by building a long-term supplier relationship. Strengths and weaknesses are internal factors, where as opportunities’ and threats are external factors. One of the main competitors is the leading brand in the world, Walmart. This paper looks at IKEA, one of the global leading furniture retailers and a very successful brand. In India local competitors like Pepperfry, which is an online furniture retail store, is giving tough time to Ikea. 2. 3414 words (14 pages) Business Assignment. One of the largest furniture, appliances and home accesories company in the world, Ikea is known for its unique design and because of its portable installations. Strengths could include a company’s specialist marketing expertise or its location. SWOT Analysis Strengths. This is not always possible. One of the world’s leading brand Walmart is a good example. Counterfeit: Many local/regional companies have copied Ikea’ products. IKEA SWOT Analysis (2016) IKEA is a brand known for its quality and affordable furniture. SWOT stands for strengths, weaknesses, opportunities, and threats. SWOT Analysis: The Swot Analysis Of IKEA 760 Words | 4 Pages. For more information on how to do a SWOT analysis please refer to our article. The approach used by IKEA to achieve its objectives is the SWOT Analysis. Ikea has experienced many lawsuits and court issues due to its employee discrimination and its poor quality of products being offered. This tool let the organization keep their focus on the main issues. The SWOT analysis of Ikea differentiates all the main strengths, weaknesses, opportunities, and threats of the company for them to achieve more. Developing Countries: Countries were per capita income is low such low-cost products could do wonder. SWOT analysis of IKEA 1998, IKEA entered the Chinese market and opened the first shop in Shanghai. SWOT analysis is a method of understanding the … When the company has reduced the cost of the product, then its quality would be compromised. The company examines strengths and weaknesses internally. This might help in the growth strategy for Ikea. They recently came in news for issuing an all men catalogue in Israel mocking their ultra-orthodox Jewish community. Accompanied by the combination of Chinese economic environment and Chinese furniture market circumstance, the following SWOT analysis will be utilized to evaluate IKEA in Chinese market. It also throws light on the threat that the business can encounter and the … 1114 Words 5 Pages. Having a strong global presence and reputation, it has seen a good place in the customers, and they would prefer this brand as compared to others. In IKEA SWOT Analysis, the strengths and weaknesses are the internal factors whereas opportunities and threats are the external factors. Also, as a fact, Ikea brand compromises over low quality, customers are always in search of high quality. This also increases their cost. Negative Image: Ikea has operations in many countries and that is why it keeps getting into local troubles in some of them. Your email address will not be published. And so, below will be a brief intro to what Strategic management is about. IKEA SWOT Analysis. The brand sees a massive opportunity to attract customers to purchase various products. Today it is the world's largest furniture retailer, recognised for its Scandinavian style. The products are inexpensive that can anyone can afford it. Ikea’s vision goes outside of home furnishing as well. Over the years, the brand has built a strong franchise system and currently, it has about 423 stores in about 52 countries and markets. You can follow me on Facebook. The SWOT Analysis of IKEA A SWOT analysis is an efficient method to analyze the components that help a business thrive or contribute to its development. When the raw material cost is on the rise, it is tough to maintain the low cost and good quality. This PESTLE analysis of IKEA uncovers recent controversies, growth, and challenges. As mentioned above, this is a brief SWOT analysis of IKEA; however, it addresses some of the key issues as follows: Strengths of IKEA. Just like an IKEA PESTLE analysis, a SWOT analysis for IKEA would be an important tool for devising an effective strategy for the company. Environmental Problems: Ikea needs to keep in check about its stakeholders. SWOT Analysis: IKEA’s uses SWOT analysis to reach the objectives or goals of the company, SWOT analysis is their one of the. It sees a big threat from competitors, faced lawsuit, and an increase in customer income. It has grown rapidly since it was founded in 1943. Ikea is operating in about 52 various markets across the world and has faced many criticisms for various kinds of issues. Swot Analysis Of IKEA. Products: Ikea’s biggest strength lies in the kind of product it manufactures and designs. SWOT Analysis and PESTEL for Ikea Singapore. Including many premium quality products into its product range, the brand would get more customers to purchase their brand. IKEA started its journey on July 28, 1943, when a 17 years old young entrepreneur boy Ingvar Kamprad laid its foundation. This is indeed a threat to the brand. Its DIY kind of products are pretty famous among customers and that makes them a primary choice for many of them. SWOT Analysis of Apple in 2020 | Apple SWOT, SWOT Analysis of Starbucks in 2020 | Starbucks SWOT, McDonalds SWOT 2020 | SWOT Analysis Of McDonalds, SWOT Analysis of Coca-Cola in 2020 | Coca Cola SWOT, SWOT Analysis of Nike in 2020 | Nike SWOT, SWOT Analysis of Netflix in 2020 | Netflix SWOT, SWOT Analysis Of Samsung in 2020 | Samsung SWOT. Swot Analysis Threats of Ikea Stiff Competition. Environmental Friendly: There is a certain growing demand for eco-friendly products in the consumers these days. SWOT analysis is a vital strategic planning tool that can be used by IKEA managers to do a situational analysis of the company . The SWOT analysis of Ikea highlights the strengths of the brand for a positive flow, its weakness where it should work on. As Ikea’s products are less-priced and do not have great quality, affordable people with high incomes would not prefer to purchase like this. On expanding its business operations to larger markets like China, India, South America along with its cost strategy, it would get more benefit out of it. IKEA has … SWOT analysis is a strategic tool that helps businesses to analyse internal and external factors affecting the bottom line. November 15, 2019. It examines the environment in which IKEA operates using SWOT, PESTEL, Porter’s 5 Forces and Value chain analyses to inspect the attractiveness and competitiveness of … This would result in a negative impact on the brand’s image. Its value stands at $18 billion. I am a serial entrepreneur & I created Marketing91 because i wanted my readers to stay ahead in this hectic business world. Let's stay in touch :), Your email address will not be published. To make sure that Ikea meets the long-term competitive advantage it must address the various concerns highlighted in the SWOT analysis of Ikea. The SWOT analysis of Ikea mentioned in this article has highlighted the main strengths of the brand that comes up from its strong financial position, affordability, strong market presence, brand reputation, and its wide range of products. This would mean that all the customers prefer to purchase products that are eco-friendly. Cost Consciousness: Ikea’s products are very cost effective and are a value for money. One of the main strengths of Ikea is its various products that they have and its design, price, and quality. Customers get a high ROI on the money they spend on this furniture. An increase in the ethical customer or the purchasing procedure is called the Ethical Chic. IKEA is well-known around the world for being that Swedish company offering inexpensive products for … By John Dudovskiy. ikea is operating in 52 countries and having stiff competition with local and international brands. They would opt for such products as they tend to change their furnishing periodically. This would get more revenue for the brand. Its value stands at $11.9 billion. The brand provides flexibility for the customers to assemble their products and this feature attracts many customers for the decision-making process. strategic planning tool; the company is focused on improving its strengths, opportunities and trying to overcome its weaknesses and threats. Ikea has always targeted to maintain a cost leadership that would execute a positive impression on its revenue. This is the very initial phase of planning for an organiz… Introduction IKEA is a multinational company that sells furnishings and furniture. In India, the local competitor, Pepperfry, is an online retail in furniture is a tough competitor for the brand. IKEA has got a business strategy that very much related to its goals of upholding and ecological design. SWOT is an acronym for strengths, weaknesses, opportunities and threats related to organizations. The focus of the brand is to provide standardized products with good service and high-quality at a low price. Ikea stands number 6th in the top 10 organization in the retail sector. At the same time, it concentrates well on Above the line and below the line marketing methods to make a strong brand for itself. On May 30, 2020June 6, 2020 By Competitors Content Team. The main strength of the brand is its cost factor. Introduction IKEA was founded in 1943 by the then-17-year-old Ingvar Kamprad, the companies name is an acronym that is a combination of his initials , plus the first letter of the farm (Elmtaryd) and village (Agunnaryd) where he grew up. IKEA uses SWOT analysisto help it reach its objectives. This might help in the growth strategy for Ikea. Political factors: Branching into Asian markets Since IKEA stores are open in more than 41 countries, the company must abide by the regulations of each. The brand should expand its business operations in the emerging markets and in the various developing countries where there are many untouched customer bases and that can be considered for effective profitability. SWOT analysis of IKEA 1998, IKEA entered the Chinese market and opened the first shop in Shanghai. Weaknesses in the SWOT Analysis of Ikea : Opportunities in the SWOT Analysis of Ikea : What is Social Stratification? Internet: DIY was a preferred choice for many customers but with the advent of the internet and social media there is nothing that customers can’t learn and look into. IKEA: PESTLE, SWOT and Porter's Five Analysis. Ikea’s financial position is strong, and it has reported revenue of about $44.6 billion. Steps like this result in negative publicity. Its weakness is seen from the negative impact of media, standardized products, and low-quality products. SWOT is the first stage of planning and looks at the Strengths, Weaknesses, Opportunities and Threats involved in a project or business venture. Strengths and weaknesses are internal factors that can be influenced by the company. Cost-conscious Consumers: Consumers are now becoming very cost conscious. A simple and efficient approach of Do It Yourself concept for products was initiated by the brand Ikea. They have heard various complaints from many employees like poor treatment, questionable acts, etc. It is a tough task to reduce product cost and maintain product quality. This brand provides almost 12000 products that have generated about 2.5 billion visitors online and about 957 million offline stores during the year 2019. Marketing: Ikea is known to be a smart marketer and it has fantastic product placement in movies as well as on television. When their income rises, they would go for better quality products. Ikea sees a huge opportunity of going on a green business model and expanding globally. Brand Value: Ikea is currently at 46th position in the world in brand value of Forbes list. Ikea makes ready to assemble furniture, which you can order and assemble it yourself. Let us discuss on the SWOT analysis of Ikea. Ikea is having its business operations in about 52 countries and has a tight competition with many local and international brands. A strength may be an excellent order management process, while a weakness may be poor communication among departments. A SWOT (strengths, weaknesses, opportunities, threats) analysis allows a company to evaluate its operations from an internal and external point of view. SWOT Analysis Ikea. Accompanied by the combination of Chinese economic environment and Chinese furniture market circumstance, the following SWOT analysis will be utilized to evaluate IKEA in Chinese market. 1406 Words 6 Pages. 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