Change is coming to Ikea: The Swedish furniture retailer is going through a rare and major restructuring that will prioritize online and delivery offerings as well as new city-center stores.
According to a Wall Street Journal report, Ikea will slash 7,500 jobs in “office-based work like communications, human resources and administrative functions,” while adding 11,500 new jobs in the next two years to beef up its online operations as the company plays catch up on e-commerce.
According to Tolga Öncü, Ikea’s head of retail, growth in the number of visitors to its existing stores has “stalled”, which has spurred Ikea to make drastic efforts to keep up with shopper behavior.
Ikea will also invest more in the in-store experience. Ikea stores, with huge footprints and a dizzying array of products, have long been a cornerstone of the Ikea brand. While countless brick and mortar retailers have one by one had to shut down, or at least, rethink their in-store approach in recent years, Ikea hasn’t made much of a change so far. But now, the company is planning to reduce the number of products it displays in stores to make room for more styled living rooms and bedrooms.
And potentially most notable to Curbed readers, Ikea is continuing its experiments in city-center stores. The company opened a small-format store in central London this fall and will open its largest city-center location yet (measuring some 53,800 square feet) in Paris next spring.
The company also just announced its first city-center store in the U.S., slated to open in spring 2019 in Manhattan, New York City. The “Ikea Planning Studio” will open at 999 Third Avenue, a location that previously housed an Urban Outfitters and sits right across from the iconic Bloomingdale’s 59th street flagship at the border of the Midtown East and Upper East Side neighborhoods.
According to a press release, the concept was “co-created with New Yorkers who provided input to Ikea throughout the planning process” and will focus on “smart solutions for urban living and small spaces.” The idea is that customers can browse furniture and order directly for delivery to their homes. Ikea told Curbed NY that the store is not expected to carry “smaller items like frames and bowls” and will not have a cafe either.
Ikea is developing some 30 new city-center stores over the next three years, with potential locations in cities like Los Angeles, San Francisco, and Washington, D.C. Stay tuned.