Ikea remains mum about its New Zealand plans

Wednesday, 3 June 2020

Ikea madness has building in New Zealand for almost three years now. This clip of the announcement that Ikea is committed to New Zealand is from 2021.

Ikea's plans for New Zealand have collided with a business metamorphosis and global recession, says one retail expert.

It has been 18 months since Ikea announced it would open in New Zealand.

In the interim period, fellow big box retailer Costco has announced plans to open in the country, bought land and received resource consent. It is expected Costco will begin construction of its massive store in Auckland in October.

Homegrown Ikea rival, Nido, spent the last 18 months building a 27,000-square-metre development in Henderson, Auckland.

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Ikea has begun to change its operating model, with smaller stores in city centres.

The first stage of the store opened on May 30.

But at the same time, the global economy was already showing signs of a slow down before Covid-19 brought much of the world to a grinding halt.

Economies, and Ikea stores, have begun to open up again, but what does this mean for the New Zealand aspirations if the Swedish flatpack giant?

First Retail Group managing director Chris Wilkinson says the Ikea business model is changing.

Ikea has repeatedly promised it is still coming.

In a statement released on Tuesday, an Ikea spokeswoman said: 'The plans to open Ikea in New Zealand remain unchanged. We don’t have any new information to share at this time. We will be sure to keep you informed as updates come available.'

In June last year, Ikea filed company documents in New Zealand.

In January, Ikea announced it would open three 'customer meeting points' across the country in the lead-up to the opening of its planned full-sized store in Auckland.

But since then, there have been no further details.

First Retail managing director Chris Wilkinson said the company was in the middle of a metamorphosis that could influence what it finally brings to New Zealand.

'The opportunities in New Zealand have collided with changes in their global market place. In Australia, you have retailers that have developed very contemporary ranges in their homeware departments. You have retailers like King Living who have been quite innovative with their furniture ranges.'

Wilkinson said a lot of companies used Ikea as a model but then moved beyond it.

'The challenge that Ikea has had globally is that there is a bit of navel-gazing going on.'

In Britain, Ikea has bought malls and introduced a mixed-retail model, that included an Ikea store alongside other stores like H&M.

Ikea was also introducing smaller stores and showrooms in city centres.

Despite the advent of Nido, there was still space for Ikea, Wilkinson said.

'New Zealanders are living in smaller spaces, and they need the smaller, European style furniture,' he said.