Ikea’s move to draw shoppers in with lower prices has taken a toll on its revenues.
The home and furniture giant has seen sales drop 6.8% for the year after it made the decision to cut thousands of prices during the cost-of-living crisis.
Sales for the financial year 2024 reached £2.3bn, versus £2.46bn the previous year.
The retailer admitted that while the move had cost it revenue, it was “more important than ever to side with the many people facing increased cost pressures” and recorded an uptick in demand as the year went on.
Ikea lowered prices at the beginning of this year, investing £117m in lowering prices across almost 3,500 of its products by an average of 20%.
The retailer also lowered the cost of online delivery and boosted free click-and-collect services.
Online sales continued growing during the period from 38.5% of its sales being made online last year to 41.7% this year, and it reached a 40% increase in zero-emission deliveries.
Ikea UK chief executive and chief sustainability officer Peter Jelkeby said: “In a year of economic uncertainty, our priority was clear: stand with our customers. In spite of our reduced turnover, continuing to lower prices remains our long-term priority. This is true to the Ikea vision.
“We want it to be as easy, affordable, and sustainable as possible for customers to shop with Ikea, whether they choose to do so in our Ikea stores, online, through our app, or with personal assistance from their home, and we are making strategic investments with this goal in mind. In the past year, we have widened the range of services on offer to customers, and it is now easier than ever to furnish your home with our fantastic product range wherever you are.”
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