Dive Brief:

  • is pulling back on its U.S. expansion, nixing three planned in three states, according to multiple news reports. In an email to Retail Dive, an spokesperson said the change of is due to “a rapidly changing retail environment. To be fit for long term growth, we are creating a new business model to make sure we’re accessible and convenient for our customers today and in the future.”

  • The canceled stores include one in Nashville first announced about a year ago, another in Glendale, Arizona announced in September and a third in Cary, North Carolina, according to USA Today. The spokesperson confirmed that the North Carolina and Arizona stores won’t move ahead, but said that a new stores in Norfolk, VA  will open in next spring and a new fulfillment center in Joliet, Ill. will open this fall.

    The Swedish furniture giant in March broke ground on its fifth Texas store and that will also open in spring of 2019, Ikea said. Otherwise the retailer has put its resources behind an e-commerce expansion and an experiment with smaller stores in urban areas.

Dive Insight:

It was evident in Ikea’s year-end reports​ in December that the company is focusing on a more nimble e-commerce operation, and this pull-back on its store expansion is another sign. Executives have emphasized they’re aware that much more activity will take place on mobile, which is one reason the company is experimenting with features like an augmented reality app

“You may have heard our Global CEO Jesper mention recently in interviews that we are looking to expand to more urban city centers to be more accessible to more consumers,” the spokesperson said on Monday. “As a result, some of our expansion plans may change, but at the same time we are also investing in our e-commerce and services to ensure customers can access IKEA no matter where they are.”

Even without much attention to its e-commerce, its digital sales at Ikea have been growing. Last year, the company experienced 2. billion website visits and 96 million visits to stores worldwide, according to its year-end report. Executives said they will study operations within its newly acquired TaskRabbit home delivery and setup service, and may consider other such investments going forward.

TaskRabbit under Ikea rolled out in March, and is now available online, wherever TaskRabbit services are located, and in six Ikea stores in the San Francisco Bay Area, New York City and New Jersey. Ikea stores in Los Angeles, Miami, Houston, Boston, Washington D.C. and elsewhere will also add the service. 

Editor’s note: This story has been updated to include a comment from Ikea. 

 



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