Stockholm (AFP) – Inter Ikea Group, the holding company that oversees Ikea, announced Monday that it was cutting 850 jobs, saying its organisation with 27,700 employees overall had grown too “complex”.
The group, which owns the Ikea brand name and manages the retailer’s product range as well as sourcing, said the cuts were needed to simplify its structure. “Despite many positive achievements, Inter Ikea Group has grown a bit too complex and too fragmented in a retail environment that requires simplicity and speed,” Henrik Elm, chief financial officer of Inter Ikea Group, said in a statement.
Going forward, the group plans to focus on three goals: “Increase sales growth, significantly reduce prices, and boost visitation across customer meeting points.” Of the 850 staff positions being cut, around 300 will be in Sweden “based on current plans”, Inter Ikea said, adding that the “final impact” would be confirmed as the process progressed.
In November, Inter Ikea reported a 32 percent drop in annual profit for its 2024-2025 financial year as it lowered prices to boost sales and faced higher costs due to US tariffs. Sales for its year ending in August fell by one percent to 44.6 billion euros ($51.9 billion), but sales volume increased by 2.6 percent and the number of store visitors rose by 1.9 percent.
Ingka Group, which owns most Ikea franchises and employs 166,000 people in 37 countries, announced in March that it also was restructuring to simplify its organisation, and said up to 800 positions could be cut.
© 2024 AFP
