Case: Ikea: Design and Pricing: Emba Operations Management First Individual Assignment
Case: Ikea: Design and Pricing: Emba Operations Management First Individual Assignment
Case: Ikea: Design and Pricing: Emba Operations Management First Individual Assignment
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CASE: IKEA: DESIGN AND PRICING
1. What are IKEA's competitive priorities?
“IKEA's competitive priority is based on producing quality products at a low price. This
concept is exemplified in its' corporate mantra price with meaning. This is achieved by
creating inexpensive products without making its customers feel cheap. This manta is
“IKEA starts the process by picking what the new product will cost. This will help to
determine color, materials used, and design. Next they choose a manufacturer using their
efficiently produce the new product. Next they design the product, keeping in mind
efficiency, i.e. Packaging, shipping etc. Every inch of the product is reviewed in order to
maximize their ability to manufacture ship and store the new product. Finally they ship it.
While shipping, the key word is flat, in fact the flatter the better. From vacuum packing
air. Lastly they must sell their new product”[ CITATION rit11 \l 1033 ]
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3. What are additional features of the IKEA concept (beyond their design process) that
“The way they ship their products is clearly one of its greatest contributors to its low
prices. By remaining flat, shipping only 65% full containers and by building its distribution
centers near ports, railways, and highways IKEA is able to ship with great efficiency. They are
able to ship the maximum amount of products, at the right time to the right stores keeping
their prices 20 the 30 percent lower than their competition” [ CITATION rit11 \l 1033 ]
4. What would be important criteria for selecting a site for an IKEA store?
“Some of the important criteria are to make sure the space is large enough to
accommodate for the large showrooms and large pieces, to have loading and unloading
dock. The site would also need to be located in a shopping area if possible. Being close to a
main highway or street would not hurt so that customers would not have to worry about
taking surface streets or waiting a long time for their delivery to get to them” [ CITATION
peo12 \l 1033 ]
“Expando, Inc. is considering the possibility of building an additional factory that would
produce a new addition to their product line. The company is currently considering two
options. The first is a small facility that it could build at a cost of $6 million. If demand for
new products is low, the company expects to increase the profits” [ CITATION peo12 \l 1033 ]
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Works Cited
people. (2012, June 24). Ikea: Design and Pricing. Retrieved September 21, 2017, from
https://www.otherpapers.com: https://www.otherpapers.com/Miscellaneous/Ikea-Design-
and-Pricing/30506.html
rita. (2011, September 4). Ikea: Design and Pricing. Retrieved September 21, 2017, from
https://www.allfreepapers.com: https://www.allfreepapers.com/Business/Ikea-Design-and-
Pricing/6309.html