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IKEA CASE STUDY

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Brendas Vilchis

on 13 November 2015

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Transcript of IKEA CASE STUDY

IKEA RESPONSIBLE ORGANIZATION
BUILDING A SUSTAINABLE SUPPLY CHAIN
Foundation
IKEA is founded by Ingvar Kamprad in Sweden in the 1920's

Canada's business environment in 1960
Government was seen by many as the accomplice of business, instead of the protector of citizens and the environment
Around 1959 Norway becomes founder member of the European Free Trade Association with Austria, Denmark, Britain , Portugal, Sweden and Switzerland and whis helps all this countries to improve their economic and financial stability
IKEA´S VISION
'To create a better everyday life for the many people.'

IKEA offers its customers a better way to live, to develop furniture to facilitate their way of life, selling them to "low price but not any price".
IKEA CASE STUDY
It sells low-price home furnishing products around the world. These include furniture and accessories for kitchens, bedrooms, living rooms, bathrooms and children”s rooms.
•In 1960's IKEA opened their first outside store in Norway and Denmark and their fast expansion cotinued in Switzerland, and in subsequent years Germany, Australia, Canada, Austria and Netherlands
Sweden joins League of Nations. During the 1920s Sweden develops from an agricultural into an industrial society. Social democratic governments enact various social reforms, which gave better financial support to all their members.

The Foreign Investment Review Agency (FIRA) was established by Pierre Trudeau in 1973 to ensure that the foreign acquisition and establishment of businesses in Canada was beneficial to the country
Throughout the years IKEA has been positioned in the market as a responsible company with the environment in a sustainable way
IKEA has achieved its aim to be a responsible business in each of the three sectors of the supply chain.
THE PRIMARY SECTOR
IKEA checks that products meet strict requirements for function, efficient distribution, quality and impact on the environment.


Solutions to minimise the use of materials
• some tables are made out of recycled plastic
• some rugs are made of material clippings that
would otherwise be wasted
• products such as water cans are designed to be stacked.
This means that more can be transported in each load, reducing
the number of lorry journeys and therefore lowering fuel costs.

SECONDARY SECTOR
IKEA designs many of its products so that the smallest amount of resources can make the best products
for example
Saving on resources by using hollow legs in furniture
Using a honeycomb-paper filling material instead of solid wood for the inside of table tops
THE TERTIARY SECTOR
IKEA's retail stores add value to manufactured goods by providing a form of shopping different to the usual high-street experience.
To make its activities more sustainable, IKEA has set up many local UK initiatives in 2006:
IKEA recycled more than 70% of its waste products. Its goal is to recycle 90% of materials.
To reduce environmental impact, they started to charge for carrier bags. This reduced the use of carrier bags by 95%. In June 2007 IKEA UK removed carrier bags from its stores completely.
New folding bikes to each of its 9,000 employees. It also gave subsidised travel tickets to encourage them to travel to and from work on public transport.
IKEA UK has provided low-energy light bulbs to its entire UK workforce and switched its fleet of company cars to low-emission hybrid models.
IKEA is a company that do a great work to reduce its costs, from the preparation of its products that would come to be the operational area to the supply chain that would come to be the area of logistics to give their customers better opportunities keeping them comfortable with their work and keeping green our enviroment
In 2000 IKEA formed a partnership with UNICEF to work on a community programme in Northern India. The aim of the work was to prevent child labour by raising awareness and addressing the root causes.
IKEA has also formed a partnership with the World Wildlife Fund (WWF). IKEA and WWF have committed themselves to promoting the sustainable use of natural resources. This helps to ensure that forests can be used both now and in the future. To support sustainable partnerships with suppliers, IKEA works with other organisations.
For example, IKEA and WWF actions have led to: a series of training courses for people in Russia, Bulgaria, Romania and China on responsible forest management the development of forestry plans in China demonstrations to managers in Latvia on the benefits of responsible forestry All these projects show IKEA's commitment to supporting sustainable practices
There are a total of 314 IKEA stores in 38 countries / regions . The IKEA Group has a total of 277 stores in 21 countries
Germany, Australia , Austria , Belgium, Canada , China, Denmark, Spain , USA, Finland, France, Hungary , Italy, Japan , Norway, Pai
Agreements Euro- Mediterranean Partnership:

Association Agreement between the European Union and Syria (2004), Lebanon (2002), Jordan (2002), Algeria (2002), Egypt (signed in 2001), Morocco (2000), Israel (2000), and Tunisia (1998).

With store sales increasing along with huge growth in ecommerce, there is an opportunity to be more accessible to the many Canadians through a multi-channel environment
Burlington announced the opening of a new distribution center of 397,000 last Octube 2015 in Mississauga Ontario. The new unit, which will create approximately 150 new jobs, will fulfil customer orders from the four existing Toronto area stores and ecommerce purchases, as well as support the growth plans for IKEA Canada to meet customers in new and existing markets.
Cotonou Agreement between the EU and Africa, Caribbean and the (ACP States) Pacific (signed in 2000 and revised in 2005)
Economic Partnership Agreement between the EU and CARIFORUM (signed in 2008).
Free Trade Agreement between the European Union and ASEAN (Association of Southeast Asian Nations) (ongoing since 2009) and Free Trade Agreement between the European Union and the Cooperation Council for the Gulf States (signed in 1998 and revision since 2002)
Timber, hydropower, and iron ore constitute the resource base of an economy heavily oriented toward foreign trade. Privately owned firms account for about 90% of industrial output, of which the engineering sector accounts for 50% of output and exports.
Financial Frameworks
The Swedish furniture multinational earns 2,500 million in its fiscal year, up 11.3% tax
Ikea obtained financial year 2009, which ended on August 31, 2009, the UN net profit of 2,500 million euros, up 11.3% in comparison with the data of the previous year, says In a company statement, which first publishes its benefits.

In a document Titled Welcome incident, the group explains that his income increased in this period UN 1.4% to 21,800 million euros, "despite the difficult external conditions." Geographically, Explaining sales in North America accounted for 15% of total Asia 6% and Europe 79%.
Over fiscal 2010, announcing multinational sales increased 7.7% from the UN, to 23,100 million euros, explaining that a meet later Dara para esta Benefits fiscal year, which ended on August 31.
The company excels that of the mayor of the profit in fiscal 2009 Do reinvested in facilities currently owned by the company in 26 countries and the opening of new centers, and in their factories and retail outlets.
Ikea CEO Mikael Ohlsson, who succeeded last year in office veteran Anders Dahlvig, has turned one of its main priorities be more transparent to its employees and customers. This Pará, has announced that the Board of the Company has agreed to publish annually the UN summary of its financial results and events more important.
"This Annual Summary English is Aimed at Our employees and suppliers as well as the Shareholders UN have shown increasing interest in knowing more about different parts of Ikea," says Olhson. By another, the CEO stressed that "a good return is necessary" to Follow Do extensive program of growth, both in the countries in which it operates and in new markets, para So give more citizens access to Products Ikea.
Politics
Ikea has a very ambitious goal: to provide all of its stores with 100% renewable and clean energy. So far, forty has installed solar photovoltaic systems in its stores in Europe and North America. He has also promised to sell only energy-efficient lighting. It is a policy that lays the foundations for a real commitment to sustainability.
To carry out actions that are efficient in terms of sustainability must think long term, and analyze their costs, investments and products with a vision. What you plant today (in this particular case, the solar panels for energy that does not pollute), will bring rewards in the future. It is an investment that will bear fruit in the following income statement of the company.
The fiscal 2010 earnings of Ikea Group rose 6.1% to 3.000 million.

The sustainability plan does not end here. They want to continue installing solar photovoltaic systems, begin to also install wind turbines and make all products are renewable, recycled or recyclable by 2015. The Group will continue to increase profits while respecting the environment.
In addition, it carries out other perhaps less known actions. One is to use flat packaging. From an environmental standpoint, the flat package allow you to send more items per trip, which is reduced by reducing costs and emissions from transport. For example, the design of the Ektorp sofa (pictured), flat pack, saving $ 11.6 million annually and reduce carbon emissions by 75%.
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