Ikea’s Competitive Advantages (9 Different Factors)

– IKEA is a big company that designs and sells ready to assemble home furniture and accessories worldwide.
– Over the last 70 years, IKEA has rapidly grown into a multinational conglomerate that designs and sells ready to assemble home furniture and accessories worldwide.

As IKEA makes strides to be more competitive in this day and age, we investigate different ways IKEA is able to gain an advantage over its competitors.

Now read on for an amazing list of 9 sources of competitive advantage.

IKEA’s Competitive Advantages In 2022 (9 Different Factors)

1. IKEA Sells Low-Cost Products

IKEA is proud of their ability to deliver high quality, reliable goods at generously affordable prices.

There is a specific demographic of 16-to-34-year-olds that buy furniture from Ikea. The demographic group is often located in urban areas. As a result, Ikea is able to charge very low prices.

________ is not the only company to benefit from selling their products at a reasonable price. However, IKEA is one of the most prominent companies to take advantage of this strategy.

Many big box retailers such as Wal-Mart, Costco, Sam’s Club and big box stores have come under fire in recent years over their prices.

ikea is really good in terms of the price. They have inexpensive things as well as high quality items so for all those who are on a budget, it would be a good choice.

A home project can start at $10,000. Most of the countertop costs fall into the $2,000 to $2,500 category. Cabinets around $50,000. Installation around $3,000.

The cost of the installation and goods vary greatly, with some companies charging high prices for their products. An example of this situation is Lowe’s selling electric plugs at $12,000, whereas IKEA sells its plugs for just $5,000.

It is also possible to earn credit for items purchased at the IKEA Store or online. With the Family Card you can also earn 15% off when you make a kitchen purchase of $1,000 or more!

2. Extensive Range Of Home Furnishing and Accessories

ikea is so huge that stores could be measured at the 300,000 square feet, filled with furniture, appliances, and accessories.

With an emphasis on products that can be reused, the design of IKEA products is based on simple, robust, and functional principles and materials which provide a better quality of life.

The storage units were redesigned to incorporate sleek modern designs to ensure customers have an incredible experience.

Some products are made with a minimalistic appearance enabling you to make your own space. You can also customize them.

As a company we see the potential to create more positive impact by working together with like-minded companies and organizations to make a more sustainable future possible.

After being certified as IKEA forests, the wood used in the creation of IKEA’s furniture is sourced from sustainable forestry.

One of the most successful designs in the ODGER collection is the ODGER Chair. This modern design was made to be more eco-friendly than its predecessors. This design is made from recycled polypropylene and reused wood fibers.

Many of the IKEA products are crafted with bamboo as it is strong, sustainable and grows 10 times faster than wood. Equally versatile, bamboo products range from plates to storage units to vibrant kitchen fronts!

Being in the business for a long time, we are able to adapt to changing consumer trends and are able to meet the requirements of our customers.

3. International Reach

ikea is a world-famous brand because they have so many products.

Even though IKEA has been around since 1945, it wasn’t until a few decades ago that IKEA stores started popping up all over the world.

Ikea has a total of over 22 pick-up and order points in 11 countries and 28 distribution centers throughout 16 countries.

In more than 50 countries, people visit their local Walmart. The stores sell more than 1 billion things each year.

Germany’s economy, for example, contributes nearly 16 trillion dollars, which is more than the U.S and Japan’s economies combined.

In recent years Ikea opened 19 new stores across the country, including its first store in Hyderabad.

IKEA will aim to expand its reach by reaching 3 billion customers every year, which will include having stores in New Zealand, Brazil, Philippines, Vietnam, and more.

IKEA offers international shipping that reaches countries without an IKEA altogether. That means you can shop for furniture from the IKEA website and receive your order at a convenient time.

4. Business Cost Efficiency

ikea strategically sells low-priced products to maintain healthy customer satisfaction, generating significant revenue by keeping its customers satisfied.

One way Ikea manages its costs is by reducing costs of its workforce on the factory floor. The low cost labor of the workforce allows the company to reduce costs of raw materials and produce its products with fewer people and at a lower cost.

-IKEA will replace shipping and handling with cheaper, reusable shipping services (such as Postmates) when transporting the packages to your home.
-IKEA will lower its retail cost and make more money because of a lower price on the products.
-By using Postmates, which is a third-party delivery app, IKEA will save $300,000 that would have been spent on shipping,
which will then be able to be spent on the price.

ikea products remain so cheap because their designers plan products based on a predetermined price which influences their choice of material. their material choices and design choices are based on both sustainability and cost.

At IKEA, there are plenty of handy digital tools available to customers both in-store and out. So, they don’t need to be a big team of employees.

In-store furniture pieces are easily located and labeled, reducing customer inquiries. The descriptive labels on the furniture are helpful and reduce customer questioning.

5. Efficient Supply Chain

ikea is a large conglomerate that is based on a variety of products, including furniture and home appliances. Through a network of efficient suppliers, this company is able to produce a wide variety of products, including furniture and home appliances.

You can ensure customer’s food safety by using the lowest risk products and also can ensure the best quality of products.

IKEA does not care about the suppliers’ business plans, as long as they produce enough to satisfy IKEA’s customers. However, IKEA has chosen to stick close to its current suppliers in order to maintain relationships, and so it negotiates the price. IKEA does not buy in bulk at the supplier’s factory. The price of the parts are negotiated at the distribution level, but IKEA buys in large amounts.

If IKEA can’t keep it’s suppliers in the country, the country won’t be a popular destination for future IKEA purchases.

IWAY Code was introduced in February 2000. This code of conduct is the basis of the IWAY brand which is the world’s leading brand of electrical wiring, wiring accessories, and equipment.

IKEA’s policies are to protect all its employees from any kind of abuse, not just child labor. They also make sure to pay the minimum wage as well as ensure the minimum safety standards. Every year, approximately 1,000 audits are done to make sure these things are being followed.

6. Strong Marketing Campaigns

ikea is the proud owner of a strong marketing strategy in which it has strong market position.

ikea had been known to market products with a personal touch, but it seemed to have changed its marketing tactics by shifting its focus to being more of a community service company.

IKEA focuses on educating their employees as well as their customers and local communities to make them aware of the items available and to make the process of buying furniture as easy as possible.

The brand is known for using funny or catchy images to their advantage, making a lasting impression on the people.

Social media sites such as Twitter, Instagram, Facebook are used to engage with a larger audience. You will also find IKEA on Pinterest, where rooms are showcased with tagged products to help the customer achieve the look.

ikea’s youtube videos have themes such as “food” and “interiors”.

A video is a great tool to build trust between a brand and your audience.

7. High Profile Collaborations

IKEA has had many collaborations in the past. They got some good attention by their collaborations with some of the big brands back in the 90’s, which is still ongoing today.

As the leading brand, alternative companies in neighboring markets are often keen to work together as they are a great way to enhance anyone’s competitive advantage.

IKEA is collaborating with Adidas and Little Sun. They are also producing The Sims with them.

IKEA is the only furniture store that includes storage and organization pieces as it’s core business. IKEA is so popular that it’s a household brand name, in addition to being the leading furniture retailer in the world.

The unique IKEA app offers consumers a unique experience that allows them to shop for furniture, appliances and more all through their mobile device.

Check out the virtual reality experience of IKEA from the comfort of your home where you can shop for goods, check stock availability, and enjoy special deals with your Family Card.

Take your camera with you to the furniture store with you and take lots of pictures of every furniture item. This way, you’ll know what you do and don’t want to purchase.

*These images are for illustrative purposes only. Images may not be identical and actual color and texture may vary.

8. Positive Brand Reputation

In order to preserve a positive, strong brand reputation, customer satisfaction is at the heart of the business.

Rapid growth and high-income figures are clearly indicating brand popularity, meaning this is a source of competitive advantage.

The IKEA furniture is getting out of stock. So, the CEO was thinking of something so that IKEA won’t lose its customers.

When it comes to customer service, the Swedish furniture giant believes in refining every aspect of its business to its very core.

The world owes a great deal to a dedicated team that understands the importance of each customer and delivers an exceptional experience. They know that only when each employee is exceptional can they truly deliver the exceptional customer experience.

IKEA stands out in a sea of low-price, low-quality brands like Walmart and Home Depot. IKEA sets its prices at about 30% higher than other, more reputable brands, making it an excellent option if you want to save money.

IKEA’s quality products tend to last more than other companies because they offer the highest quality components, the best materials, and the utmost craftsmanship. Its longevity comes out of the high demand for IKEA products.

9. Differentiation

Differentiation strategy has helped IKEA to make itself distinctive. The company designs different products and tries to design those products which are attractive, functional and distinctively different from the competition.

The fact that Ikea furniture is simple, easy to assemble and it could be bought at low prices, makes it a good option for any household.

Ikea has successfully maintain a variety of loyal suppliers and placed them at the clear production advantage.

Unlike others competing home furnishing and accessories retailers, IKEA markets store trips as a day out for the whole family. The experience begins as soon as you step through the doors.

Walmart is the biggest store in the United States and when you want to reach your destination, use digital maps to find the best parking, find which aisle to park in, and get directions.

This allows customers to make use of IKEA’s products by themselves without any staff at all.

The time that we spent outside the store was very memorable; we had a lot of fun and we also tried our hands at crafting. The whole experience helped us get a better understanding of the market and also the products.

IKEA stands out in a sea of low-price, low-quality brands like Walmart and Home Depot. IKEA sets its prices at about 30% higher than other, more reputable brands, making it an excellent option if you want to save money.

IKEA’s quality products tend to last more than other companies because they offer the highest quality components, the best materials, and the utmost craftsmanship. Its longevity comes out of the high demand for IKEA products.

For more information on how the company functions, read our overview of the IKEA business.


As IKEA aims to set itself apart from its competitors, they strategically market to the masses. Because of IKEA’s low-cost, high-profit business model, IKEA is able to sustain their cost advantage well.

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I have always been a shopaholic. A lot of times my questions went unanswered when it came to retail questions, so I started Talk Radio News. - Caitlyn Johnson

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