India Offers Up Vision Of How IKEA Sees The Future Of Retail

Retail India Offers Up Vision Of How IKEA Sees The Future Of Retail Mark Faithfull Contributor Opinions expressed by Forbes Contributors are their own. Explaining the stories behind the headlines New! Follow this author to stay notified about their latest stories. Got it! Aug 21, 2022, 01:00am EDT | Share to Facebook Share to Twitter Share to Linkedin Ingka Centres, the property arm for IKEA, broke ground in India last week on a huge scheme.

Ingka Centres For a company that specializes in neatly flat packing its customers’ homemaking dreams, IKEA has a perversely three dimensional view of the future. Because IKEA, or more specifically the group’s property arm Ingka Centres (the two businesses sit under the umbrella of the Ingka Group), doesn’t really want to talk about retailing any more. And it definitely doesn’t want to talk about malls.

Instead its personable managing director Cindy Andersen wants to talk about Meeting Places and why she doesn’t even know what the buildings coming out of the ground in China and, as of last week, India will be used for when they open. Given that Ingka Centres is throwing a not inconsiderable $400 million or so at its latest project – Gurugram, a city southwest of New Delhi, in the state of Haryana, India – that might seem a little worrying. But Andersen seems distinctly unflustered and with Scandinavian nonchalance says she is “super-excited” at this latest leap into the unknown, which broke ground only last week.

There are other Meeting Places, especially in Europe, China and particularly and now not especially conveniently, in Russia. Many of those are essentially IKEA-anchored malls and in Western markets the business has largely pivoted towards urban formats, notably in London, Vienna, Stockholm and, before long, San Francisco. But the latest developments in China and now India are different animals.

Firstly, they are huge – Gurugram will come in at over 1. 7 million square feet over nine floors and will cost about $400 million to construct. Secondly, they are being conceived as places of multiple, overlapping uses.

MORE FOR YOU ‘No Christmas Trees, No Christmas Trees’ Another Shortage May Be On The Way The Grocery Business Is Going To Get Much More Competitive Costco Addresses Supply Chain Pains By Chartering Their Own Ships Yes, there will be an IKEA and some stores. As for the rest of it, well that’s up for grabs. Ingka Centres Gurugram At Gurugram, Andersen is promising green areas, workspaces, plus spaces for community events, with a focus on local needs, food and beverage and learning spaces, 325,000 sq ft of office space atop the retail area, plus more special initiatives.

Planned to open in late 2025 with an expected annual footfall of 20 million, the new Meeting Place has, says the company, been designed to encourage relaxation and mental and physical well-being amid a community hub, including a landscaped sky roof garden, amphitheatre for public events and an inner garden connecting the two levels of retail and F&B. Don’t tell IKEA’s ubiquitous Allen key, but when it comes to new development “one size does not fit all” says Andersen, because the Swedish-based company is predicating its ambitious construction plans on creating an eclectic mix of sites worldwide. In the U.

K. that meant taking over a tired mall in West London and creating a community retail and leisure scheme. It also meant taking over the former Topshop on Oxford Street for an upcoming store in a location that would have been unthinkable even five years ago.

In San Francisco it means the 6X6 will include an “innovative food concept”, offices – probably based around the Stockholm Hej!Workshop – and facilities to encourage entrepreneurship and sustainability. Evolving future: Ingka Centres managing director Cindy Andersen Ingka Centres “Our Asian schemes are quite different and far more diversified,” says Andersen. “What we want to do is reach out to the community and create places where they will want to meet and visit often.

In each location that will be different. Gurugram won’t be open until late 2025, so right now I can’t say exactly what that mix will be. ” IKEA To Exit Russia While a second site at Noida, also around Delhi, has been acquired, the manual for the size of the Indian IKEA universe has not yet been written.

Not even the bit advising whether it’s a two-person job or ok to attempt alone. That said, Andersen points to the urbanization of India and clearly the company will focus its growth and development on metropolitan India. As for Russia – previously one of IKEA’s most successful markets – the Mega Centers remain open to serve essential retail, although IKEA confirmed last week that it had decided to liquidate its limited liability company IKEA Dom, further scaling back its operations after more than a decade-long presence in the country.

IKEA shut down its stores in March and said it would sell factories, close offices and reduce its 15,000-strong workforce in Russia. Such unexpected setbacks are likely to sharpen the focus on the untapped Indian opportunity. Andersen constantly references co-creation, collaboration and community as she talks about the “evolving plans” for a seemingly bountiful market that has, let us not forget, humbled more than a few Western retailers.

But then they didn’t have an Allen key. Follow me on Twitter or LinkedIn . Check out my website .

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