Case Study of Ikea - 1445 Words

Case Study of IKEA’s Global Sourcing Challenge In 1995, IKEA met a problem that its main supplier, Indian rugs, used the child labor to produce products, although they had signed an attachment of the contract to ban employing child labor. In addition, a German documentary maker was about to broadcast the problem of child labor on German television and also invited an employee from IKEA to have a live discussion in the TV program. Marianne Barner, the leader of IKEA, must find a great solution to this serious issue to both save her business and the corporation’s brand image. In this issue, IKEA was not the one who produced products, so they might not realize the use of child labor in the process of production. In addition, child labor†¦show more content†¦Moreover, customers will trust IKEA’s products because the label can indicate products are produced without child labor. However, working with the third party is also of some risk. For instance, if IKEA allows Rugmark to monitor the process of production, t hey will learn about some internal information about IKEA, such as the way to manage suppliers. The foundation has members such as manufacturers and retails. If they know this kind of internal information, they might utilize it. To be worse, if this information is leaked to IKEA’s competitors, IKEA will be uncompetitive. Another disadvantage is that if the third party asks IKEA to pay for supervision, it might be costly. Another way is to stop the relationship with these suppliers which use child labor and find some other partners. In this method, it can help IKEA get rid of the blame for using child labor. When IKEA does not sell the products which are produced by child labor, the issue will not hurt IKEA any more. But it is also of high risk. Child labor is a social issue embedded in Indian culture. If IKEA would like to find some suppliers without using child labor, it is almost impossible for IKEA to find suppliers in India. As a result, IKEA must target at other countries such as China or Vietnam which might have cheap labor force. However, searching for suppliers is very time consuming. In addition, if the labor force in other countries is not as cheap as that in India, theShow MoreRelatedIkea Case Study620 Words   |  3 PagesIKEA case study 1. Firm specific advantages IKEA has a variety of firm specific advantages since its business approach appeared to be very unique for the furniture industry. First, IKEA’s most important specific advantages were its good value for the money. IKEA used this advantage for its expansion plans all over the world. IKEA when they failed in the USA had to highlight this specific advantage to bail them out of the financial difficulty they had gotten into. Second, the most innovative decisionRead MoreIkea Case Study1030 Words   |  5 PagesI. Factors Contributing to Ikeas Success Swedish company, Ikea, has experienced many triumphs throughout the business history. Founder Ingvar Kamprad created a successful business from a financial gift his father gave him. There are several factors that contribute to Ikea’s success. These factors include their low cost price strategy, the design of their store, and the shopping experience for customers. Ikea’s low cost low pricing structure. Ikea’s low cost pricing strategy was a key to theirRead MoreCase Study Ikea1919 Words   |  8 PagesCASE STUDY [pic] International Strategic Marketing Management Success Factors of IKEA IKEA is one of the most successful furniture retailer’s worldwide. The factors that contributed to this success and distinguished IKEA from its competitors will be monitored in the following analysis. First, IKEA has found â€Å"niche† to serve. The fact that they are producing â€Å"Scandinavian style† products makes them unique. Their idea of offering a very broad range of products, with limited style variationsRead MoreIkea Case Study5459 Words   |  22 PagesCase Study IKEA: FURNITURE RETAILER TO THE WORLD INTRODUCTION IKEA is one of the world s most successful global retailers. In 2007, IKEA had 300 home furnishing superstores in 35 and was visited by some 583 million shoppers. IKEA s low-priced, elegantly designed merchandise, displayed in large warehouse stores, generated sales of â‚ ¬21.2 billion in 2008, up from â‚ ¬4.4 billion in 1994. Although the privately held company refuses to publish figures on profitability, its net profit margins wereRead MoreIkea Study Case2928 Words   |  12 Pagesâ€Å"IKEA invades Americaâ€Å" Case Study 27.11.2012 Marketing II Saskia Jaeger, David Varnai, Lukas Razmilić Table of contents 1 What factors account for the success of IKEA? 4 2 What do you think of the company’s product strategy and product range? Do you agree with the matrix approach described in Figure B of the case? 5 3 Despite the success there are many downsides to shopping at IKEA. What are some of these downsides? IKEA’s vision statement (in Figure C of the case) describes how the companyRead MoreIkea Case Study2106 Words   |  9 PagesMBAA 514: Marketing Case Study of the IKEA Company September 12, 2011 Embry-Riddle Aeronautical University- Worldwide â€Æ' Executive Summary IKEA (2011) has found a wide market in the discount furniture industry. The mission is simple- provide furniture to help everyone decorate as they like (IKEA, 2011). The company always strives to lower costs and pass savings to consumers (IKEA, 2011). It provides exceptional products which enabled the company to increase sales through the recession (MannersRead MoreIkea Case Study3501 Words   |  15 PagesMARKETING MANAGEMENT CASE STUDY Synopsis This case study is to deliberate about IKEA’s marketing strategy in reaching out customers. Also discussing about IKEA’s business idea and IKEA follows a quite traditional pattern of internationalizing and also drives the localization thoughts in different market place to stay competitive. Their vision â€Å"To create a better everyday life for the many† and their ultimate business idea â€Å" To offer a wide range of well designed, functional home furnishingRead MoreCase Study : Ikea Case Study1479 Words   |  6 PagesMike Borrelli April 31st, 2015 Global Strategic Planning Dr. Neiva Ethical Analysis Essay – IKEA Case Study IKEA, founded in 1943 by Swedish Ingvar Kamprad, is a global leader in the furniture industry. Starting as a mail-order company when Kamprad was 17 years old, the name IKEA comes from his initials along with his family farm (Elmtaryd) and his family’s parish (Agunnaryd). From this start-up that sold mostly small items like pens and binders, Kamprad added furniture to his mail-order catalogRead MoreIKEA Case Study1430 Words   |  6 PagesIKEA Case Study 1 IKEA - Case Study Panagiotis Charalampous Northcentral University IKEA Case Study 2 Synopsis of the situation IKEA (Ingvar Kamprad Elmtaryd Agunnaryd) is a privately held, international home products company that designs and sells ready-to-assemble furniture, appliances and home accessories. The company is now the world s largest furniture retailer. IKEA was founded in 1943 by 17-year-old Ingvar Kamprad in Sweden, named as an acronym comprising the initials of theRead MoreIKEA Case Study2977 Words   |  12 PagesReport To: Carol George From: Fangyi Shao Subject: IKEA case study Date: 24. Apr. 2009 1. Introduction IKEA is the world’s largest furniture manufacturer who offers a wide range of well-designed, functional home furnishing products at a low price that many people can afford it. IKEA’s mission statement describes the purpose and distinctive advantages of the company clearly. (See appendices â…  ) It can also motivate management by saying ‘create a better everyday life for people’ because employees