Ikea, a retail giant, has reportedly encountered a multimillion-dollar hit due to the closure of 2 stores in Singapore during the COVID-19 lockdown. The Swedish firm, however, is focusing on its growth strategy and is planning to rise from the loss by opening a new outlet in 2021.
The move comes along the heels of a severe downturn caused by the pandemic that has severely inflicted the retailers, which will help it advance forward for long-term growth.
Sebastian Hylving, Ikea’s expansion & property director of Southeast Asia and Mexico, has reportedly stated that the company has high growth opportunities and has been expanding its services in Singapore since 2015. Additionally, the brand is more prevalent in this region as compared to other regions across the globe. For instance, its 2 stores in Tampines and Alexandra have recorded around 7 million visits per year.
The new store, to be opened in the Q2 of 2021, will cover a space of 70,000 sq. ft. and spread across 3 floors of the Jem mall. It will be relatively smaller in size as compared to the other two outlets, with no playground or built-in warehouse. However, it will offer a full product range and a restaurant. This opening of a small concept store will be the 1st of its kind in Singapore. Other cities that have small concept stores include Macau and Moscow.
Despite facing million-dollar losses in the last two months, which is the hardest hit sales period in the past 40 years, the company is planning to weather these setbacks and develop as a more robust company. It has also gained benefits from the restrictions posed by the government during the coronavirus crisis.
The online turnover has been increasing at a rapid pace in the past 2 months, with sales of the office desks and chairs accelerating by 31% as compared to the same period in 2019.
The 3rd store in Singapore will cater to the consumers and offer added convenience for purchasing products through the traditional purchasing model.