Surge in online sales at Ikea helps offset impact from lockdown

Homeware demand buoys
Ikea said it was buoyed by strong growth in its online operations as customers turned to its home delivery services.
// Ikea UK reports total full-year sales of £1.90bn, with a 31% surge in online sales
// With stores closed for up to three months of the financial year, Ikea UK’s total sales actually declined 10.2%
// Online now represents 27% of its total sales in the UK, compared to 19% in the previous year

Ikea has hailed “resilient” trading over the past year as soaring demand for homeware from locked-down shoppers helped it to shake off some of the impact of store closures.

The Swedish furniture retailer’s UK business has revealed total sales of £1.9 billion for the year to August 31, down 10.2 per cent against the previous year.

Its stores remain shut due to Covid-19 restrictions and were closed for a significant part of the past financial year amid the first UK-wide lockdown.


However, it said it was buoyed by strong growth in its online operations as customers turned to its home delivery services.

Online sales jumped by 31 per cent to now represent 27 per cent of the company’s UK sales for the first time.

In the previous financial year this stood at 19 per cent.

Ikea’s UK boss Peter Jelkeby told the PA news agency that it was a “year of acceleration” as already-burgeoning growth in its online business grew rapidly.

“2020 was the year that changed everything – from the way we live our daily lives, to the way we do business,” he said.

Jelkeby added that demand from customers was not quashed by the closure of stores.

For example, the rapid increase in home working resulted in a 322 per cent increase in small desk demand in June, while there was a 136 per cent increase for its Markus office chair.

“We already had a strong online business so that put us in a good position to deal with the shift in trade when the first lockdown started,” Jelkeby said.

“It meant we could still deliver really resilient trading, while there was still pent-up demand from shoppers wanting to visit stores.

“There has been real focus on people’s homes over the year – people have had the opportunity to think about what they look like, what they need, and that has shown in our sales.”

Ikea’s response to the pandemic also resulted in the rapid acceleration of its transformation plans, with new digital initiatives introduced at pace.

This included launching click-and-collect across all stores, using stores as local fulfilment and distribution centres, to increase capacity and reduce delivery lead times, remote kitchen, wardrobe and living room storage planning appointments, and rolling out “click and deliver” to 4000 DPD drop off points nationwide.

Meanwhile, despite stores being closed for up to three months of the financial year, Ikea offered financial stability to all staff by continuing to pay 100 per cent of salaries.

The retailer also launched a Covid-19 Emergency Fund for stff experiencing additional hardship as a result of the pandemic through non-repayable grants.

Ikea also remained committed to fighting the climate emergency and continued its efforts to becoming climate positive and fully circular by 2030.

Sales of Ikea’s People and Planet Positive products were particularly strong, with 63 million sold, representing 30 per cent of the total volume of products sold over the course of its financial year.

Looking forward to 2021, the retailer said it would continue this commitment with initiatives such as the removal of all non-rechargeable alkaline batteries from its home furnishing range, alongside the launch of its “Buy Back” service, which will see Ikea stores offer to buy back unwanted Ikea furniture from customers and resell them as secondhand items.

with PA Wires

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