About IKEA

IKEA (IKEA) is one of the few dazzling business miracles of the twentieth century, from its humble beginnings in 1943 with a small "poor" stationery mail-order business, it has grown in less than 60 years to a chain of 180 stores in 42 countries, employing more than 70,000 people worldwide***. "In 2001, IKEA earned 11 billion euros in revenue and a net profit of more than 1.1 billion euros, making it the world's largest home furnishings retailer, and earned the honor of being ranked 44th in Interbrand's TOP 100 Most Valuable Brands in the World.

The storm and not fall, all through the trouble but stronger, IKEA is bound to have its own unique recipe for success. According to the author, IKEA success lies in, from Wal-Mart as the representative of the cost of leading route, and Sears as the representative of the brand as different routes, out of the same time, but also created a third way: both brand control and cost control, brand and cost of both.

I, self-developed brands, the absolute control of the brand

For the vast majority of retailers, the manufacturer's brand is still the mainstream, the intermediary brand can only be a useful complementary part of, and can never be "dominated by", whether Wal-Mart or Carrefour is so. This means in practice that the brand only controls the channel, but not the rights and interests of the brand. Carrefour, for example, is well known and attractive to shoppers, but a "Carrefour" brand of sanitary towels may be less well known and less attractive.

However, IKEA is not content to control even the world's largest home furnishings channel, but wants its own brand and its own proprietary products to eventually reach the entire world. Based on this philosophy, IKEA has always insisted on designing all products and patents themselves, with more than 100 designers working feverishly around the clock each year to ensure that "all products, all patents". So for IKEA, there is never any pressure from the so-called "upstream manufacturers", and no manufacturer can manage the so-called "distribution chain".

In a sense, IKEA is the only organization in the world that is successful in both channel and product management.

Two, "module"-oriented R & D and design system IKEA's R & D system is also very unique, able to combine low-cost and high-efficiency. IKEA invented the "module"-style furniture design method, which not only reduces the cost of design (because basically every design is a "module"), but also reduces the cost of design. IKEA invented the "modular" approach to furniture design, which not only reduces the cost of design (because basically every design is manufacturable, and there is no inexplicable waste of money due to a large number of designs that are not implementable), but also reduces the cost of the product (modularity means that it can be mass-produced and mass-logisted).

IKEA's design philosophy is "who can design a product for the same price at a lower cost", so designers often compete on whether they can use one fewer screw or utilize a bar more economically, which not only has the benefit of lowering costs, but also often produces brilliant ideas.

Possibly IKEA is the only organization that can y understand "simplicity is beauty", and he uses "simplicity" to reduce the cost of customer concessions, and "beauty" to increase the value of customer concessions. The value of the customer's concession is increased by the "beauty".

Three, strict OEM management measures

Although all the product design work is carried out by IKEA itself, but in order to minimize the cost of manufacturing, IKEA outsourcing the manufacturing of the world, more than 2,000 suppliers will be fierce competition each year for this purpose, only in the quality of the guarantee at the same time to achieve the lowest cost of the supplier may get a large number of orders, and these suppliers are in the best position to ensure the quality of the product, and these suppliers are in the best position to ensure the quality of the product. Only the suppliers who can guarantee quality and the lowest costs can get the big orders, and these suppliers can't rest on their laurels when they receive the orders, because IKEA will be assessing them from time to time.

Not only that, but IKEA will re-evaluate its supplier performance every year, and suppliers from countries with cheaper labor costs, such as China, will continue to appear on its supplier list.

Additionally, IKEA sets fixed targets for its suppliers each year to keep production costs down, so that its manufacturing costs can enter a virtuous cycle of continuous decline.

Four, well-designed logistics system

Logistics is supposed to be a big item of the cost of home furnishing products, because the transportation is too much trouble, but IKEA through the "flat pack" is not only to improve the efficiency of transportation and reduce the cost of transportation, but also in the assembly of the assembly to save a large sum of assembly costs. IKEA does not provide finished assembled furniture, but by the customer to ship home, self-assembly).

In order to further reduce logistics costs, IKEA has concentrated nearly 20 distribution centers and central warehouses around the world in major transportation routes and distribution towns to facilitate logistical links with its stores.

Starting from real-time sales records provided by stores, feedback to product centers, then to OEMs, logistics companies, and warehousing centers, until transferring back to stores, the entire logistics chain runs extremely smoothly with the support of IT technology.

Fifth, let the price of their own way to talk about sales

IKEA access strategy is absolutely no discount direct sales, in order to ensure that the price of the product, sales records, the maintenance of patents, as well as the amount of control of the entire sales system, IKEA has always refused to wholesale its products, the bulk of group-buying customers also do not provide any "concessions! "In addition, IKEA does not rent out any of its own counters, and even its own restaurants.

In the terminal, IKEA as a low-cost leading manufacturers attach great importance to play the price in the sale of "this time no sound is better than a sound" role, the use of "SOFT SELL (soft sell)" way. "Experience marketing" ......IKEA stipulates that its store personnel are not allowed to directly to the customer sales, but let the customer to experience their own decision-making, unless the customer takes the initiative to its counseling.

"Information marketing"......IKEA carefully develops a "shopping guide" for each product, with information about the product's price, functions, rules of use, and purchasing procedures. Almost all of the information is available.

"Vivid marketing"......IKEA to a variety of complementary products for home combinations set up different styles of model rooms, to fully demonstrate the effect of each product on the scene.

Unique strategy to produce extraordinary performance, IKEA's story made a wonderful endorsement.