MUMBAI: At a time when companies worldwide are rethinking their supply chain strategies amid threats of disruption posed by tariff uncertainty, Swedish home decor and furniture retailer Ikea is bolstering its bets on India as a sourcing market for its global and local operations.The company, which has a network of about 40 home furnishing suppliers in the country, is trying to increase sourcing from India “wherever it can” and is looking to add new suppliers as it scouts for more opportunities, said Christina Niemela Strom, (global) head of sustainability for supply, Inter Ikea Group.In an interview with TOI on Monday, Strom said that Ikea’s plan to boost local sourcing in India from 30% to 50% by 2030 also opens up scope for the company to expand global sourcing from the country. “Our supply footprint has to be resilient for what happens, and we see that India has to play a big role in that as well. We are here for the long term. The goal spoken (50% target) is for local produce, but that will for sure also bring in opportunities for going global,” Strom explained.
Ikea’s purchases from India stand at around 400 million Euros in 2024, and global sourcing makes up a big part of it, given that it started retail operations in India only in 2018, Strom said. The company has been sourcing from India for close to 50 years, and it already counts India as among its top 10 global sourcing markets. Ikea largely ships out ready-made goods from India, which include curtains, rugs, and bed linen. “We are monitoring the US-India FTA developments closely. Trade has an influence, and we try to make the most of it,” Strom insisted. Beyond sourcing, Ikea could also look at introducing new product segments in India and then take them global. “Made in India is good,” Strom said while talking about the appeal of Indian-made goods in global markets. Ikea started retail operations in India with its first store in Hyderabad in 2018 and is currently present in more than 10 cities through a mix of offline and online stores. Europe is Ikea’s biggest supply region, followed by Asia and the Americas. Most of what Ikea sells in the US is manufactured in other countries, including China. Despite high commodity inflation in India over the past few quarters, Ikea didn’t raise product prices in the country, Strom said. “Given the broader slowdown we have seen, home furnishing is not the first thing buyers will think of, and so we have to make sure we remain affordable. Value for money is important to us, and we have rolled back the price hikes we took during Covid,” Strom added.
