The Core Concept Of IKEA
A comprehensive and detailed description of each core and peripheral competency identified for the case study firm.
Started in 1951, as Ikéa, known as IKEA is nowadays one of the most valuable private held companies in the world. The core concept of IKEA is to provide many people a range of home furnishing products, which according to IKEA is achieved by combining, quality, design, function and value while keep sustainability in mind. The concept exists among every part of the company, from design, sourcing, packing and distributing through to the business model. The aim of IKEA is to help more people live a better life at home. (IKEA Concept, 2015)
The aim of IKEA’s concept is to bring it to life, which is done in many ways:
• Trough the
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The aim of Ingvar Kamprad was to have a total independence and long-term ownership structure. According to Ingvar Kamprad, all companies operating under the IKEA Brand had to build resources before they could expand.
For this reason, the IKEA franchise system was established. Nowadays, all IKEA stores, except the IKEA Delft store in the Netherlands, operate under franchise agreements.
(Franchise structure, 2015)
The vision of IKEA is “to create a better everyday life for the many people”. Their business idea is “to offer a wide-range of well-designed, functional home furnishing products at prices so low that as many people as possible will be able to afford them”. This is achieved by offering quality at affordable prices to the customer through optimising the entire value of the chain, by building a long-term supplier relationship, with producing large volumes and by doing so, investing in highly automated production. (Business concept,
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Those benefits consists of, discounts to save money, special events taking place in-store, inside scoops and sneak previews.
Diverse portfolio
The main business of the firm is designing, manufacturing and selling furniture, but the company also operates restaurants, supermarkets, houses and flats.
Everything can be bought
As mentioned earlier, what has been eaten in the restaurant can also be bought in the supermarket.
Its vision and strong concept
The vision of IKEA is “to create a better everyday life for the many people”. Their business idea is “to offer a wide-range of well-designed, functional home furnishing products at prices so low that as many people as possible will be able to afford them”. (Business concept, 2015)
Private held
The IKEA Group has been privately held by the founder of the company Ingvar Kamprad. All funds has to be either re-invested in the company or has to be donated for charity purposes. (Franchise structure, 2015)
Opportunities
Expending online sales
In order to sustain its competitive advantage, the IKEA Group needs to expends its online
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