Ikea Strategic Plan

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Names: Freddy Kaan 157228, Selina schmid 171778 , Tramy Le 147710, Larry Atabongafac Nkacha 126063, Gerlof veltman 144789, Rixt Bruinsma 165646

School: Stenden Hogeschool

Teacher: Mr. Hendriksen

Date: 9 March

Group: 3

Table of contents
Executive Summary:3
Introduction of the case:3
Introduction of the company4
Analysis of current situation6
Current mission:6
Goals:6
Strategy:6
Internal environment6
Core competence:6
Synergy:7
Value creation:7
Functional analysis:7
Strengths:7
Weaknesses:8
External environment8
Macro environment8
Opportunities:9
Threats:9
Porter five forces10
SWOT-matrix:11
Strategic Gap:12
Strategic choice:13
Implementation plan:14
Conclusion and Recommendations :15
Bibliografy16

Executive Summary:
IKEA is a company established in the early 1940s. The company has 140 stores spread over 30 different countries. IKEA is a retailer that sells furniture, home furnishings and house wares. IKEA has a clear mission: selling a wide range of furniture and accessories at a reasonable price so that most people can buy them. IKEA is mainly active in Europe and the US. 78 percent of IKEA’s income derives from these markets. The customers are mostly youngsters or families. Currently IKEAs strategy is the cost leadership strategy. By employing the self-serving method IKEA managed to keep the prices low. Since the financial crisis the demands of the population has changed to low budget furniture. Many companies have also started to focus on cheaper prices because of this, although IKEA is still cost leader in their market segment. IKEA is one of the biggest furniture companies but not widely present in areas around Europe and America. In order to enter those markets and fill other gaps IKEA has to change to the transnational strategy. This will introduce cultural awareness connected to low cost furniture. Although competition is raising and IKEA is mostly present in a concentrated area IKEA is one of the biggest furniture retailers in the world and is still growing.

Introduction of the case:
The following is a strategic analysis of the company IKEA international. In the Introduction of this paper, the company will be described from different points of view. The first analysis part concentrates on the current situation of the company, what strengths and weaknesses they have, and which opportunities and threats they are facing. Also, the MARCO environment will be regarded, and the current strategy and position of IKEA will be made clear. Most importantly in this part are the company’s mission and goals. The main part of this work is the analysis of the strategic gap of IKEA as well as setting up other strategic choices for this company. Here, the difference between IKEAS mission- so desired position, and the current position will have to be evaluated. For this strategic gap, there are different ways of improving the situation. The forth part will give several strategic options and explain the pros and cons of each of them for IKEA. Finally, the last part of the paper is going to focus on an alternative strategy for IKEA which is best to overcome their gap. The implementation part gives all the details in how to reach this goal and pursue the strategy correctly.

Introduction of the company

Development of IKEA:
IKEA was founded in 1943 by Ingvar Kamprad. The name IKEA consists of the initials of Ingvar Kamprad and the first letters of the farm Elmtaryd and the village Agunnaryd where he grew up. First IKEA was selling pens, wallets, picture frames, table runners, watches, jewellery and nylon stockings. In 1947 IKEA published its first catalogue which was quite simple, from which people could make their mail orders. In addition, it began advertising in local newspapers. In 1950 IKEA introduced furniture and kitchen accessories to the catalogues, which was the first step in leading the company towards the...
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