Why Ikea Go International Case Study
Why did IKEA go international?
Before starting to analyze IKEA’s internationalization, let’s consider on the question “why do companies go international?”
Generally, companies go international for a lot of reasons, but the main ones are company growth and profit making as well. In order to be succeed on international market, it’s very important point to define the international strategy. If to define the international strategy: an international strategy is when a company hires a strategy through which its goods and services are sold out of its local market. Enlarging into international markets allows potential opportunities to companies. Let’s see the IKEA’s international strategy in the following Figure 1.
IKEA has expanded from a small, family-owned home furniture corporation into a global retailer within 385 stores in 48 countries, during its 72-year history. After the opening of first store in Sweden in 1953, by 1960’s Swedish market was saturated and as Sweden is a small market, there is not much opportunities for growth any more. IKEA decided to expand its market international starting from neighborhood Scandinavian countries according to similar consumer tastes.
Internationalization process Norway was the first country where IKEA started its international expansion in 1963. Denmark and Switzerland stores were the following foreign market entries. IKEA’s internationalization process is divided to three main stages. In the following Figure 2. We can see these
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