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Business

MOA to host P7 billion investments for world’s biggest IKEA store

Louella Desiderio - The Philippine Star
MOA to host P7 billion investments  for worldâs biggest IKEA store
Swedish home furnishing retail giant IKEA officially announced plans to open its largest store in the world in the Philippines. The store at the Mall of Asia will be about 65,000 square meters, almost double the size of a typical IKEA store. Photo shows (from left) Swedish Ambassador Harald Fries, IKEA Southeast Asia managing director Christian Rojkjaer, IKEA Philippines market development manager Georg Platzer, SM Prime Holdings chairman of the executive committee Hans Sy, SM Prime president Jeffrie Lim, IKEA Southeast Asia expansion manager Sebastian Hylving and SM Supermalls COO Steven Tan.

MANILA, Philippines — Swedish furniture giant IKEA is spending an initial P7 billion for its first store in the country which would be the company’s biggest in the world when it opens before the end of 2020 at the Mall of Asia complex in Pasay City.

IKEA Southeast Asia managing director Christian Rojkjaer said yesterday the company, which has the right to own and operate IKEA stores in Malaysia, Singapore, Thailand and the Philippines, has entered into a lease agreement with SM Prime Holdings Inc. for the first IKEA store in the country.

Many Filipinos have been waiting for the announcement of the opening of IKEA’s store, with reports of the furniture brand planning to establish its presence in the Philippines being made as early as February 2013.

Rojkjaer said IKEA wanted to understand the market and find the right location before making any announcement on the first store.

Planned to cover around 65,000-square meters of a mixed-use building in between the MOA Arena and SMX Convention Center at the Mall of Asia complex, IKEA’s first store in the Philippines would be the biggest in the world.

IKEA Southeast Asia market development manager Georg Platzer said the P7 billion investment would be used to fit out, stock, market, and set up the store for opening.

He said the first store in the Philippines has the biggest size because apart from the shop floor and restaurant, there would be a warehouse, e-commerce facility and integrated call center to cater to customers.

“The size of the store is connected to our logistics needs. As we said from the beginning, we have a need for quite a huge warehouse because from this store, it’s not only the products we sell currently, but also e-commerce will be from this location,” he said.

When the store opens in 2020, the company is expected to have around 500 employees, including those who will be working on the e-commerce and call center operations.

Platzer said IKEA has chosen the Philippines as the location for its biggest store because of the opportunities seen in the country given the growing middle class and number of residential projects being developed.

“What is so special about the Philippines? We love you. And there is a need for home furnishing. There’s a fantastic growing middle class market. We see a lot of people shopping. There’s a lot of developments going on, residential areas, condominiums, housing. There are beautiful, positive signs in the horizon and I think there is no other market that deserves the biggest store than the Philippines right now,” he said.

While the focus for now is the opening of the first store, he said IKEA would also want to expand to other areas in the country in the future.

As it prepares for the opening of the first store, IKEA is looking for local partners to support operations in areas such as food supply, transport, waste management and security.

Similar to other markets where IKEA opened stores, Platzer said there may be opportunities to source raw materials from the Philippines for products being sold.

“We have suppliers in Thailand, in Malaysia, in Indonesia so, why not in the Philippines? It just has to make sense because the supplier has to supply the entire world, not only for the Philippine operations,” he said.

IKEA’s first store in the Philippines will feature home products ranging from candles and cookware to kitchens and sofas.

There will also be products to help people live a more sustainable life at home, ranging from affordable LED lights to recycling solutions. – With Iris Gonzales

CHRISTIAN ROJKJAER FURNITURE IKEA
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