Swot Mma

Introduction:
 IKEA is Ingvar Kamprad Elmtaryd Agunnaryd

 the World’s largest retailer in the furniture sector and it is
well known for Scandinavian style
 it was established in the year 1943
 This type of furniture allows reduction in packaging and
costs
 There are 9500 different products which includes
accessories and home furniture
 IKEA stores comprises of cafes and restaurants which
serve typical Swedish food.
SWOT ANALYSIS
 The important part of plan and process is the scan of
internal and external environment. Firm’s internal
environmental factors are divided into two categories
Strength and weakness.
 Firm’s external environmental factors are classified into
two types opportunities and threats.
 SWOT analysis gives information about firm’s resources
and capabilities to the competitive environment where it
operates.
Difference between internal and external factors
 Internal factors are finance, manufacturing capabilities,
marketing and so on. Goodwill, patents, cost advantage,
favorable access of distribution network are firm’s
strength. A weak brand name, poor reputation, high cost
structure is some of weakness of firm.
 External factors are Macroeconomics matters, legislation,
socio-cultural changes as well as changes in competitive
positions or market place. Opportunities are New arrival
of technology, unfulfilled want of customer. threat are
New regulations, increased trade barriers emergence of
substitute product .
Strengths
 Quality without compromising on variety of ranges adds
to a strong brand image of IKEA.
 It offered distinctive, ergonomic products at affordable
prices.
 They mainly focused on the pricing for every designed
product,.
 Measurement of strengths is through KPI (Key
performance indicator).
 The main strength of IKEA lies on the environmental
consideration it has during its production stages.
 Increased usage of materials that are renewable with a steady
rate of over 4% for a period of 2 years.
 Thoughtful usage of raw materials chipping in more recycled
items or industrial waste products in most of their stores with a
rate of 6% in a span of 2 years.
 Economic advantages due to bulk acquisition at lower unit costs.
 Optimization of logistics and supply chain.
 Labor charges, cost of handling and reduced distances between
supplier and IKEA retail stores due to direct delivery by the
suppliers.
 Innovative technologies adopted in developing each and every
product.
Weakness
 The network and area of their global arena was a
concern. The quality and standards of the products could
not be looked upon at all places. This would affect the
supply chain and create a negative impact on the
consumers’ attitude towards the products.
 Quality and affordability need to be in a state of balance.
It must create a differentiation strategy from its rivals in
producing new products.
 IKEA must work on the consumer and, stakeholder
awareness on the environmental decisions.
Opportunities
 IKEA’s takes sum opportunities and made
favor from them to sustain in market.
1. Demands is growing on green products
2. Demand is even growing on low priced
products
3. Demand on minimum consumption of water
and lesser carbon footprints
 IKEA works in many ways by using
opportunities
1. Providing online ideas and tips to customers to sustain
life and home in websites
2. Motivating to use recycling and renewable energy
3. Adopted social responsibilities like donations to
worldwide life funds, UNICEF and to children welfare.
4. They had a good communication relationship with
consumer, co-workers to maintain direct contact to
stakeholders.
Threats
 Social Trends: Housing markets are the basic and
important market segment for the products of IKEA. They
faced slowdown in the initial buyers entering the market.
 Market Trends: There were more competitors who were
entering the economic or low priced furnishing &
household markets wherein they had to compete with
those competitors by reinforcing its unique qualities.
 Economic Factors: It has been found that during financial
crisis among the public, the income is cut down and
expenses remain limited so to overcome this.
Conclusion
 IKEA has created a brand image worldwide with its stores
around the world. The performance can be improved by
assessing competitive and external environment.
 The design, optimization of resources, pricing strategy
and its products and systems are all showing the
environmental commitments.
 The right packaging and design, fewer transportation
costs, paves way for the reduction of the carbon
footprints.
 IKEA intends to go far from reputation and profitability.
Sustainability is the main business truth.

Swot Mma

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Introduction:

 IKEA is Ingvar Kamprad Elmtaryd Agunnaryd

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