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  • irishtimes.com - Posted: July 27, 2009 @ 3:45 pm

    Ikea – fiscal stimulus or predatory giant?

    John Collins

    Ikea finally opened its doors in Ballymum this morning after years of, in my opinion, over the top media attention and speculation. Apparrently about 3,000 people passed through the doors during the first two hours of trading at the Swedish home furnishings giant. That’s pretty respectable in the teeth of a recession. Of course if they had opened at the height of the Celtic Tiger, as they hoped to do, the scences would probably have been similar to the chaotic opening in Edmonton, North London in 2005 which saw five people hospitalised and the store closed after 30 minutes.

    The possible economic impact of Ikea on an already decimated furniture sector will be watched closely. Gerry Harvey, the Aussie businessman behind Harvey Norman, has been telling anyone who will listen about how his 14 Irish stores are hemorrhaging money, while high profile stores and chains such as HabitatArramount, Land of Leather, Classic Furniture and Jim Langan have got into trouble or ceased trading.

    Luckily Irish entrepreneurs are seeing the potential in the arrival of the kings of the flatpack. If you don’t like allen keys and confusing intructions take your choice between any number of out of work carpenters and handymen who will do the task for you such as FlatpackUnpack.ie and Notboxes. Personally my favourite is the slightly crudely named Simple Assembly Me Hole.

  • 19 Comments »

    1.
    July 27, 2009
    4:07 pm

    Maybe the media attention is over the top, however the opening of such a major international store in a country which is severly depressed by such a huge economic slowdown can’t be a bad thing! Also, the effect this is having on the small businesses which offer flatpack assembly services is encouraging. Let’s hope IKEA keep up their successful start.

    Comment by Franchise Direct
    2.
    July 27, 2009
    8:58 pm

    Over the job media focus indeed, I’ll agree on that. I don’t understand the hype of this store or any of the others mentioned. Good for jobs, not for the pockets. But good for Sweden and their economy since profits will be going back there.
    The novelty won’t wear off for a while until it becomes like Argos, Aldi and Lidl to people.

    Comment by CarolineD
    3.
    July 27, 2009
    9:00 pm

    A decade too late. It will be interesting to see how the prices compare to their NI store.

    Comment by Liam
    4.
    July 28, 2009
    3:55 pm

    where’s the commentary with regard to the question of Ikea being a predatory giant? I can see your references to potential fiscal stimulus.

    Ikea’s policy and approach to affordable furniture that doesn’t look like it came out of a bargain bin is what has endeared it in so many countries. Although this is probably where it could be deemed more covert operative like a chameleon than a marauding lion.

    What people should do is go visit a longer established Ikea in the UK and look at the state of the assembled showroom furniture. The shelf life of a lot of Ikea stuff is appalling short, especially those that suffer from day to day contact so there is a long term price to pay for cheap furniture.

    I cant wait to see the number of lookalike house interiors popping up in the next while, especially rented accomodation. Or every newspaper suppliment doing their own Ikea ‘chic’ – chic-kea (TM) – room conversion. I feel sick already at the thought.

    Comment by paul m
    5.
    July 29, 2009
    8:43 am

    Of course the coverage of IKEA is over the top and the Swedes are laughing the whole way to the bank. Their PR machine is pumping out figures on job creation, No mention of job losses in small indigenous furniture manufacturers and retailers. Of coutse anyone reading blogs on retailing in Ireland will be aware that Irish shoppers know the price of everythng and the value of nothing. By the way , how did IKEA get the planning law changed to allow them to construct sucha large outlet? Hmm.

    Comment by John Williams
    6.
    July 29, 2009
    11:57 pm

    It was a good response in Bucharest/Romania, in 2007, when the first IKEA store opened.
    The prices from other competitors dropped in a jiffy :) .

    Comment by Cristian
    7.
    July 30, 2009
    1:23 am

    A glorified MFI and they produced rubbish which was sold cheaply to the masses. Give them 2 years and they’ll be sorry they came to Ireland. Ask Go Harvey Go Home!

    Comment by James M
    8.
    July 30, 2009
    5:29 pm

    The last thing Ireland needed at this time is a huge Ikea store! I like their products and have bought much from them over the years. I can certainly say that the overall quality of their product is very good, they do last! Ikea is a giant competitor for the mostly not very competitive domestic industry. I am curious to see if the prices are the same as in the rest of Europe but I don’t plan to visit the Irish shop for the moment.

    Comment by Fiona Harris
    9.
    July 30, 2009
    9:21 pm

    Ikea is overrated. Believe me, as a Norwegian, I know. People I know have bought a number of different furniture from this store, chairs, tables and shelves and all they had to put together themselves. Sometimes, they fall apart. Often there are screws and bits missing so you have to go back and order these things. Ikea also has a range of purposeless things with hideous neon colours. Where do they fit in in your comfortable relaxed home? Nowhere. The only trustworthy, safe items I’ve come across are knives, forks and plates. You don’t have to put them together yourself.

    Comment by Liv N
    10.
    July 31, 2009
    10:56 am

    @Christian
    My brother runs a good quality joinery making hardwood furniture i.e. not MDF. He is sensible and didn’t overstretch during the boom
    This year however all his staff are on a three day week and he is barely breaking even and you reckon he should drop his prices.
    Why is it so many Irish people reckon Johny Foreigner should go home yet they and are first in the door when a new foreign big box like Ikea, Tesco or B&Q opens?

    Comment by Seán
    11.
    July 31, 2009
    1:48 pm

    I wondered how long it would take for the Ikea snobs to emerge from behind their sofa – even by Irish terms less than a week is quite quick.

    Ikea made decent quality affordable furniture that wears well and looks good. Also the stock range is far too big for the ‘look a like interiors’ mentioned.

    It’s a wake up call for furniture outlets in Dublin, that were selling vastly overpriced MDF rubbish. But as this is Ireland there are no doubt plenty of people happy to pay inflated prices in the name of ‘taste’.

    Of course the talk of job creation is nonsense in a service related industry, but not necessarily in Ikea’s case – as it will take from the Belfast and Manchester stores, which is not our problem.

    Also if you have a reasonably serviced and working brain you can put their products together quite easily.

    Comment by Noel
    12.
    July 31, 2009
    5:18 pm

    You’ll soon grow tired of it. Its all laminated, or has a low breaking threshhold. The stuff doesn’t hold up well, unless you have the comportment of a geisha girl or a cloistered nun. …I can’t see that as a possibility in Ireland.
    By the way, the owner of IKEA lives in Switzerland, the Swedes aren’t getting anything out this, either
    Paul
    Washington, DC

    Comment by Paul Leddy
    13.
    July 31, 2009
    10:05 pm

    IKEA, has arrived right on time to counteract the ‘rip-off-republic’ fuelled by 10 years of untrammelled greed. Choice, democracy, service, price – IKEA now rules the market here.

    Tom

    Comment by Tom
    14.
    August 1, 2009
    5:38 am

    Ikea is popular because it gives people a chance to be interior designers of their own homes and gives a really affordable option. Most of the savy buyers, just use some of the Ikea items and add a mix of durable and classic pieces. I remember living in Cork and trying to find decent furnishings at an affordable price, there was nothing. The furniture shops were full of dated and mixed up ranges. Ireland refuses to become competitive and then complains when the competition arrives.

    Comment by Deirdre
    15.
    August 1, 2009
    11:43 am

    The stores mentioned in the blog are horrible, all Irish mammy furniture and Harvey Norman?? Hate to tell you but they have sent all their crap to Ireland.

    There has not been anything in this country that has catered to young couples/families for a sensible price, Ikea has been the first without fusty old lady furniture.

    If you put it together properly (and I can assure you I have never missed a part) it will be fine. I have mixed antiques, good quality irish furniture and Ikea for a great comfortable relaxing look.

    Thank God the times of a bathroom cupboard for €200.00 are over.

    Good furniture makers will survive the rubbish shops that have sold over priced crap will not.

    Comment by Michelle
    16.
    August 3, 2009
    1:02 pm

    The reason Ikea is so successful in other parts of Europe and in the US is because people rent unfurnished apartments. When I first moved to Belgium in 2002 I had to furnish and equip an entire apartment quickly and with little money. I don’t think the same market exists in Ireland. On quality, my Ikea furniture has lasted 7 years and has been dismantled, come across the Atlantic with me for 2+ years and come back again. I’m now replacing it with more interesting, better quality pieces from smaller local shops (in Belgium).

    Comment by Kate
    17.
    August 3, 2009
    1:28 pm

    The Swedes are not laughing all the way to the bank.
    As far as I know no funds accrue to Sweden from Ikea’s international sales. IKEA is ultimately owned by a family-controlled foundation registered in the Netherlands. Apparently, the Dutch offer more attractive tax terms than Sweden.
    Just like U2, IKEA likes to wave the flag, but when it comes to paying tax, the flag-waving stops.

    Comment by Kevin, Stockholm
    18.
    August 3, 2009
    2:00 pm

    IKEA spend a huge amount of time and money on design and development, and spread that cost thinly over ginormous production runs. That’s the formula of their success and you can see it and appreciate it in every item in their store. Design is the part of the process that indigenous and UK furniture superstores have skipped for years, in their efforts to cut costs and maximise profits. IKEA found a way, through mass-production of having design, quality and low prices all at the same time – welcome IKEA, good riddance to anyone who fails at the same game. Obviously, small-scale, bespoke Irish furniture makers will always have their niche, and won’t really be affected by IKEA.

    Comment by Dylan
    19.
    August 5, 2009
    3:35 pm

    IKEA has generated alot of jobs when we badly need them. I used the services of Paul from http://www.FlatpackUnpack.ie as mentioned in the article. He was unemployed and is getting work now thanks to IKEA. Its a great service and really cheap too!

    Comment by Sharon

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