The Czech branch of the furniture giant Ikea earned a total of 9.7 billion crowns in the past financial year, which ended in August. This is 7.5 percent less year-on-year, as companies have complicated business-closed department stores and problems in goods logistics. On the other hand, coronavirus measures have raised online sales by almost 40 percent, the company said in a press release.
The department stores were visited by 5.3 million customers in the given year, ie about half than usual in the years before the pandemic. The average expenditure in them reached 1925 crowns, while in the e-shop it was 4249 crowns.
“The past financial year has brought something we have never encountered before. Department stores in the Czech Republic had to be closed for six months during the pandemic. The pandemic has brought and continues to bring great challenges to our logistics and supply chain,” admitted David McCabe, Ikea CEO. Czech Republic, Hungary and Slovakia.
During the pandemic, when the department stores had to be closed, the Ikey e-shop repeatedly struggled with outages or inability to complete orders due to system overload. But the problem was also unavailable goods. According to the company, there were hundreds of products across the entire range, most of all furniture. Some of them have been unavailable for a long time due to supply chain problems that have affected traders around the world.
Ikea therefore began renting more boats and buying her own containers. At the end of last year, she said she was forced to pass on the cost to customers because she expected fluctuations in logistics to continue.
Globally, it announced an average price increase of nine percent. “Unfortunately, now, for the first time since higher costs began to affect the global economy, we need to pass on some of these increased costs to our customers,” said Tolga Öncü, retail operations manager.
Scan & go and circular hub online
However, Ikea is going to expand its services in the new year. For example, it will now offer services in so-called pop-up kiosks to customers in smaller Czech cities.
“These will be smaller kiosks in which our experts will help customers with interior planning. It will also be possible to order products directly here. We want to gradually open these kiosks in regional cities outside Prague,” McCabe added.
The Ikea mobile application will see new functions in the Czech Republic. Customers will be able to use it for purchases directly in department stores, using the scan & go method. Therefore, they scan the products directly in the application, which they then also pay for in the application. The service will start operating in pilot operation first in the Ikea Brno department store.
A novelty of Ikey will also be the greater availability of circular fungi. Used furniture can be viewed and booked online.
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