IKEA: The Japanese Misadventure and Successful Re-entry


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Please note:

This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

Case Details:

Price:
Case Code : BSTR289 For delivery in electronic format: Rs. 300;
For delivery through courier (within India): Rs. 300 + Rs. 25 for Shipping & Handling Charges

Themes

International Business | Globalization Business
Case Length : 18 Pages
Period : 2002-2008
Pub Date : 2008
Teaching Note : Not Available
Organization : IKEA
Industry : Retail
Countries : Japan

Abstract:

The case discusses in detail Sweden-based furniture retailer, IKEA's re-entry into the Japanese market and the strategies it adopted on its re-entry. IKEA first entered Japan in 1974 through a joint venture with a Japanese company as a part of its plans to expand globally. It exited from the country in 1986, after failing to develop a significant presence. IKEA decided to re-enter the market in 2002, and the second time around, it conducted a thorough study of the markets and visited several Japanese homes to understand their requirements better. IKEA then formulated its strategy for the Japanese market based on 'small space living', and brought in products that were suitable to the Japanese -storage boxes, sofa beds, two-seater sofas, etc.

As of 2008, IKEA operated through three stores in the country. The case discusses in detail, store and employee management, localization, and promotional strategies adopted by IKEA in Japan, and concludes with a discussion on possible challenges it could face in the country.

Issues:


» Understand the furniture retail market in Japan

» Understand the reasons for IKEA's exit from Japan

» Study the factors that shaped IKEA's re-entry into Japan

» Analyze some of IKEA's strategies in Japan

Contents:

  Page No.
IKEA Gives Japan another Try 1
Background Note 2
The Japanese Misadventure 4
IKEA Japan: The Second Coming 5
Opening New Stores 6
Store and Employee Management 8
Localization Strategies 9
Promotional Strategies 10
What Lies Ahead 11
Exhibits 14

Keywords:

Globalization, Business environment, Localization, Store management, Product design, Promotion, Furniture industry, Furniture retail, Privately held business, Family owned company, IKEA, Japan

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