Housewares retailer Ikea announced total sales of £1.411 billion in the UK for the financial year ending 31 August 2014, an increase of 11.3% on the previous year.
The chain said: ‘Following an ambitious pledge last year by UK country retail manager Gillian Drakeford to double turnover and market share by 2020, this year’s double-digit growth shows strong movement towards this reality, with market share also growing by 0.5% to 7.1%.’
Commenting on the results, Gillian Drakeford said: “We’re delighted to report such positive growth here in the UK for the third year running. What’s really encouraging is that this growth has come from our existing business, not relying on a bricks and mortar expansion programme. Over the past year we have been focused on really understanding how our customers live at home here in the UK, and presenting our unique product range in a relevant and inspiring way in each of our stores. We’ve continued to invest in making it easier for our customers to shop with us and are thrilled that these investments have resulted in another year of fantastic growth.”
Over the past three years, a number of investments have been made to improve the in-store shopping experience for customers. Following a £4 million investment in 2013, the children’s and living room departments continued to see growth in 2014, with sales rising by 17% and 11% respectively.
In February Ikea launched a new modular kitchen system, METOD. An £8 million investment was made to introduce the kitchen concept, including rebuilding kitchen departments in all stores and training co-workers to deliver a more convenient service to customers.
Over the past year bedrooms and bathroom departments have been refreshed, in preparation for a key focus in these areas this financial year including the addition of UK standard bed, mattress and linen sizes to the existing bedroom range. An immediate increase of 21% for bathrooms and 10% for bedrooms has already been seen, in comparison to financial year 2013.
A further 250 visits were made to customers’ homes in the areas around its stores. The knowledge gained was used to redesign the display room-sets in the kitchen, bedroom and bathrooms departments, showcasing the range with local relevance.
Ikea continues to see strong growth in online sales, with a 26.8% sales uplift in 2014, following double digit growth the previous year. “Our online business continues to be a driver of growth here in the UK and now makes up 10% of our overall sales. We are excited to see that this is not at the expense of our stores, in which we had a 5% increase in visitors over the past year”, said Gillian Drakeford.
She continued: “In the next year and beyond, we want to be more accessible to many more people, and better known for what we do well. We want to simplify and improve the shopping experience and offer convenience and value for time to our customers. I recognise we have a lot of work to do here and over the coming year we will be making a number of updates on our way to creating a truly multichannel shopping experience.
“Meanwhile, we are continuing to explore expansion opportunities in the UK as we believe our physical stores will be just as important as our digital channels in the future. We have secured locations in Reading, Greenwich, Exeter and Sheffield, and additional sites are being considered.
“Finally, but not least importantly, this year we will invest £27 million to lower prices across our range, the largest investment into lowering prices we’ve ever made in a single year, as we continually look to provide home furnishings to as many people as possible, no matter how much money they have”.