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Monday April 24, 6:46 PM

Swedish furniture retailer Ikea opens 1st outlet in Japan

(Kyodo) _ Swedish furniture retail giant Ikea opened its first outlet in Japan on Monday in Funabashi, Chiba Prefecture, making a fresh foray into the Japanese market since its withdrawal in 1986 after a 12-year operation through franchises.

The Japanese unit of the company, Ikea Japan K.K., launched the five-story outlet with store manager Gordon Gustavsson cutting a log in a traditional ceremony marking the opening of Ikea outlets.

Ikea Group President and Chief Executive Officer Anders Dahlvig said at a press conference that now is the "right time" for the company to reenter the Japanese market compared with the 1970s and 1980s. Back then, Japanese society was not so open to international companies and its infrastructure was not well prepared as the company shipped everything from Europe, he said.

"Today, it's a totally different situation where we have a presence in Asia...We have supply centers and warehouses. You know it's a different Ikea today. Japan is more open. Today is the right time to come to Japan," Dahlvig said.

The Funabashi shop, which was built on a site vacated by the world's largest indoor ski slope SSAWS, has a floor space of 40,000 square meters and features 73 Japanese-sized room sets furnished with Ikea items, Swedish restaurants and a playground for children.

Ikea Japan said it conducted research on more than 100 Japanese homes prior to the Funabashi store launch to understand the way of living and the difficulties of storage which occur in everyday life.

One room set is 22 square meters and is modeled on an apartment room for a single person.

Tommy Kullberg, president and CEO of Ikea Japan, said the company has prepared typical Japanese sinks and fish grills to cater to local customers' needs. "I do feel we have done a lot of homework," he said.

The Swedish retailer operates 233 outlets in 34 countries with manufacturing centers located in nine countries mostly in Eastern Europe. For Asian markets, items are gathered from around the world at distribution centers in Kuala Lumpur and Shanghai and then shipped to each nation, according to Ikea Japan.

Reiko Hashimoto, a 60-year-old Chiba resident who came to the store with her husband and daughter, said Ikea items with their simple and colorful designs "could suit younger customers."

Dahlvig said the reason why Ikea manages to offer its items at affordable prices is that "customers are part of our distribution" process. The average age of Ikea customers around the world is 41 and the furniture retailer's core customers are young women and families, he added.

Ikea Japan is scheduled to open its second outlet in Tsuzuki Ward, Yokohama, on Sept. 15 and the third one on Port Island in Kobe by the summer of 2008.

In five years' time, the furniture giant plans to operate four to six stores in each of the Tokyo and Kansai metropolitan regions, it said.


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