Ikea UK sales jump as post-pandemic customers invest more in their homes

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Ikea’s UK sales jumped 13% as customers looked to invest more in their homes, both in store and online, post-pandemic.

Ikea

Ikea saw customer store visits grow by 34% year on year

The Swedish homewares giant reported sales of £2.2bn in the UK for the financial year ending August 31, 2022, driven by what it called a “strong appetite from customers to invest in their life at home”.

During the period, customer store visits grew by 34% year on year, while online sales grew 36% compared with 2019, pre-pandemic levels.

To meet growing customer demand, the retailer opened its first small high-street store in Hammersmith during the period and announced the opening of another store on London’s Oxford Street.

It also invested nearly £50m in its ecommerce fulfilment network and a further £33m on a new fulfilment centre in Dartford, Kent, during the financial year. In addition, it launched a collection service with supermarket giant Tesco.

During the period, Ikea UK reduced its operational climate footprint by 14% as it aims to become a ‘climate-positive’ business by 2030.

With the cost-of-living crisis ongoing, the retailer said it will start paying staff £11.95 an hour in London and £10.95 in the rest of the UK by January 2023, as part of being a Living Wage Foundation member.

Ikea UK said the war in Ukraine and increased inflation continued to have a “significant impact on materials and transportation costs within the global supply chain, and in local energy and other costs” – reducing operating margins to 2.3% from 3.1% the previous year.

As was first revealed by Retail Week, the business said that “prices were adjusted across large parts of the range in the financial year 2022 to reflect this increased cost-base” as a result.

Country retail manager and chief sustainability officer for Ikea UK Peter Jelkeby said: “We saw consumers returning to our stores, while online sales remained strong with high demand for a convenient shopping experience.

“To meet these needs, we opened our first small store on the high street, created new ways to meet customers remotely and in store, and launched new ways to deliver orders.

“With a variety of stores, service offers and digital solutions that complement each other, our aim is to be there for our customers, however they want to meet us.”