Ikea India Entry Strategy Essay

8086 words - 32 pages

IKEA INDIAExecutive Summary:IKEA originated in 1943 by a 17 year old Ingvar Kamprad using his entrepreneurial skills selling items out of a catalog and continued to expand where his stores is located in more than 30 countries currently. IKEA sells furniture and other household products at a very low price so that everyone can afford them. IKEA is always looking to save money on their packaging, costs, and any other opportunity they get to save money. As a team we thought it would be most beneficial for IKEA to enter into India specifically Mumbai, India. India is one of the most emerging countries and gives IKEA a great opportunity. As a team we feel IKEA should implement interior designers that help people decide which furniture properly fits in their house hold. The interior designer will be extremely knowledgeable and accommodating when helping people decorate their homes.India is an emerging country with one of the largest democracies in the world. India has one of the largest populations in the World which is a great opportunity for IKEA. One problem with the huge population is the wide array of income ranging from the very wealthy all the way down to the lower class who may work for as little as a dollar a day. The furniture industry in India only consists of .05% of its GDP which is another reason IKEA has a great opportunity to be successful in India. India has a large opportunity for FDI (foreign direct investment) because of the current economic conditions and the rapid growth rate of the country in terms of GPD and other economic indicators.IKEA in India will maintain the original Swedish logo and plans to target people in India in the lower middle class and above. It is estimated that there are between 30 and 300 million people that would fit into IKEA's target market. IKEA plans to start as one store in Mumbai and expand depending on sales and revenue. IKEA will need to have managers who are experienced help with the opening procedure to ensure that everything is done right. It is essential for IKEA to hire Indian managers and retail workers as they will be able to make a connection to the guests that foreigners might not be able to make. People of India understand how life works, what people want, and how they do business. IKEA will need to cover all aspects of business in terms of employment from sales people all the way up to top management and everything in between.IKEA must promote and market their opening properly so that people are aware of the store location and what it has to offer. Advertising and promotion is very important for them and utilizing social media could be a large attribute to their marketing campaign. IKEA is going to issue common stock and other aspects of business to ensure that they can afford the transition into India. There are many challenges that IKEA may face in this process, but through careful analysis and marketing research they can overcome any adversity that may come their way.Company...

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