Ikea India buys site for first store
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Ikea India has acquired the land for the first of 25 stores planned for the country.
The Swedish home furnishings company says the 13 acre site is located close to the IT hub Hitec City and is close to public transport, including a metro line under construction.
Further details were scant, except that the land was acquired from the Telangana government. Ikea India plans 24 more stores in the long term and is currently evaluating sites in Mumbai, Bengaluru and Delhi NCR.
Each Ikea store will cost about $100 million to establish, including land and construction costs.
Part of the arrangement allowing Ikea to open single brand stores in India is that it has to source product from within the country. The company already has about 50 suppliers in India employing some 45,000 people. Now it is actively searching for more suppliers to boost the proportion of locally-sourced stock.
IKEA India CEO Juvencio Maeztu described India as a promising market because it offers the company the opportunity to source, retail, conduct CSR initiatives through Ikea charitable foundation and empower social entrepreneurs through next generation projects.
“Our focus now is to bring all of it together in Hyderabad as we have bought our first land to build an Ikea store. We will bring a unique shopping experience through our inspiring stores offering affordable home furnishing products,” he said.
Questions & Answers
Q.Where will Ikea India's first store be located?
Where will Ikea India's first store be located?
The first store will be situated on a 13-acre site close to Hitec City, Hyderabad's IT hub. It is also conveniently located near public transport, including a metro line that is currently under construction, making it accessible for customers.
Q.How many stores does Ikea India plan to open in the country?
How many stores does Ikea India plan to open in the country?
Ikea India plans to open a total of 25 stores across the country. Following the acquisition of land for its first store, the company is now evaluating potential sites for the remaining 24 stores in locations such as Mumbai, Bengaluru, and Delhi NCR.
Q.What is the estimated cost to establish each Ikea store?
What is the estimated cost to establish each Ikea store?
Each Ikea store is estimated to cost around $100 million to establish. This figure includes both the land acquisition expenses and the subsequent construction costs required to build and fit out the retail outlets, ensuring a consistent brand experience.
Q.What is a key requirement for Ikea to operate single-brand stores in India?
What is a key requirement for Ikea to operate single-brand stores in India?
A crucial part of the agreement allowing Ikea to operate single-brand stores in India is the requirement to source a proportion of its products from within the country. The company is actively seeking more suppliers to increase local sourcing efforts.
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