Ikea Ireland said widespread price reductions led to a 2.4 per cent decline in the value of sales in the 12 months to the end of August, amid falling revenues across the wider group.
Ingka Group – the largest franchisee within the Ikea structure, which accounts for 90 per cent of the retailer’s sales – said on Thursday revenues had fallen 5.3 per cent to €45 billion in its latest financial year, its first drop in annual revenues since 2020.
The group said it had sold more goods but at prices that were on average 10 per cent lower than in 2023.
In a statement, Ikea Ireland – part of the Dutch-anchored Ingka Group – said it spent more than €10 million lowering prices on some of its most popular items this year, leading to a 2.4 per cent decline in the value of its Irish sales in the year to the end of August, to €246 million.
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Almost 3,000 products were reduced, offering customers “an average price reduction of 19 per cent” on those items, the company said.
A spokeswoman for Ikea Ireland said while the value of sales was down, volumes were up “slightly” compared with 2023. The retailer said consumer demand picked up as the year went on and more prices were reduced across its kitchens, bedrooms and children’s ranges.
“In a year of economic uncertainty, our priority was clear: stand with our customers,” said Peter Jelkeby, chief executive of Ikea Ireland and UK. “In spite of our reduced turnover, continuing to lower prices remains our long-term priority.”
Meanwhile, Ikea said it had continued to expand its presence in the Republic and has now opened six “plan and order points” over the past two years in counties Dublin, Cork, Sligo, Louth, Kildare, and Carlow.
Online sales accounted for 35.9 per cent of Ikea Ireland’s total sales in the year, up from 33 per cent last year. The retailer said its new 26,674 square metre distribution centre in Greenogue Logistics Park in southwest Dublin, which opened earlier this year, has been a key factor in the growth of its online business.
Meanwhile, Ingka chief executive Jesper Brodin told The Financial Times the group had gone “all in on affordability” in the past year after lifting prices considerably during the pandemic.
Ingka said it has maintained its market share despite a reversal of pandemic consumer patterns, beginning last year as households spent less on home furnishings.
Ikea discloses its annual financial information in two stages – sales in October, and profitability and balance sheet next month. – Additional reporting: The Financial Times
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