Swedish furniture giant Ikea plans to entice Indian customers with food

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  • Ikea's upcoming 400,000 square foot store in Hyderabad will have a 1,000-seater restaurant in the middle.
  • The restaurant will serve evergreen vegetarian dishes like idli, sambar, veg ‘biryani’ as well as socially acceptable tweaks to its trademark beef and pork meatballs.
  • Food accounts for 5% to 10% of the furniture giant’s global revenue.
Ikea, the world’s largest furniture retailer, is banking heavily on samosas and idlis to lure customers in India. Though food accounts for 5% to 10% of the furniture giant’s global revenue, the company expects the percentage contributed by the sale of its food items to be larger in India.

Patrick Antoni, deputy country manager at Ikea India told the Economic Times, “We believe that we might have more customers eating than buying furniture, but the average ticket size of food is very small compared to furniture. So most likely, food will be the first contact point for people coming to the Ikea store.”

In fact, its upcoming 400,000 square foot store in Hyderabad in Telangana, slated to open in July, will have a 1,000-seater restaurant in the middle. This would be Ikea’s largest restaurant in the world. The restaurant will serve evergreen vegetarian dishes like idli, sambar, veg ‘biryani’ as well as socially acceptable tweaks to its trademark beef and pork meatballs, which will morph into vegetarian and chicken meatballs.

This is quite a strategic move on Ikea’s part considering India’s food service market is estimated to be worth over ₹3000 billion. And the model has been known to work, especially in malls.

Other than its menu, the Swedish retailer is well aware of the fact that Indian consumers are not so hot on doing things themselves and Ikea furniture traditionally follow the “do-it-yourself ” (DIY) assembly model. In order to keep from losing out, Ikea plans to set up a 150-member team to help assemble furniture. It is also partnering with UrbanClap, a services app that provides carpenters along with a bunch of other services.

With plans to open up 25 stores across India by 2025, looks like Ikea is committed to providing its customers what they need rather than sticking to tradition.
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