So, the initial idea was to provide food to customers in the store so that they hang around for longer without having to go outside for a lunch or snack break.
IKEA stores due to their size are usually located in the city outskirts and far from where regular restaurants are located. IKEA’s food business wasn’t a random experiment, but a well-thought out strategy to drive their furniture sales. IKEA’s food sales account for 6% of its total revenues and have been growing at 8% annually since 2016. Yes! IKEA’s food business across various bistros, cafés and restaurants makes a whopping ~$2.5 billion in sales annually! Whether the company takes it to the next level of its promised potential - we will have to wait and watch. So, IKEA's restaurants are an integral part of its business and definitely here to stay. In the articles, we took the example of IKEA's Hyderabad store to figure out if IKEA's food business actually helps with their furniture sales.ġ) Turns out, that ~32% of visitors came to IKEA to get food.Ģ) And, IKEA's food business is able to drive ~5-15% of its furniture sales!
Their main goal was to increase footfall and extend their customers' visits.īut, today, IKEA's food business makes $2.5 billion dollars in sales annually! These food centers, in the beginning, weren't meant to be profit centers. So, the initial idea was to provide food to customers so they hang around in the store longer without having to go outside for a snack. These stores were naturally far away from any local restaurants or food chains. You see, most IKEA stores are huge warehouses located on the city outskirts.
IKEA's food business wasn't a random fluke but a deliberate strategy to drive their furniture sales.
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