By Greta Rosen Fondahn STOCKHOLM, Feb 24 (Reuters) - The owner of most IKEA outlets worldwide said on Tuesday sports retailer Decathlon will open a store in one of its British locations as the budget
IKEA to Lease Space to Decathlon at UK Store in Retail Revamp
By Greta Rosen Fondahn
STOCKHOLM, Feb 24 (Reuters) - The owner of most IKEA outlets worldwide said on Tuesday sports retailer Decathlon will open a store in one of its British locations as the budget furniture giant rolls out trials of bringing third parties under its roof to attract more shoppers.
Ingka’s Store-in-Store Pilot and Retail Strategy
Ingka is testing whether renting space to other brands can increase visits and monetise its existing square metres as it revamps giant stores for a value-driven shopper.
"We believe complementary offers can encourage more people to visit our stores and engage with the products in new ways," Javier Quinones, Ingka Group's commercial manager, told Reuters.
FORMAT REVAMP
Traditionally known for its giant out-of-town "blue-box" stores, IKEA has over the past decade revamped its store formats, developing smaller inner-city stores and showrooms while investing in digital services to adapt to new shopping habits.
It has also cut prices across a range of products over the past years in an attempt to bring back cash-strapped consumers.
Sales and Footfall Context
Ingka Group, the main IKEA franchisee with stores in 32 countries, last year reported its lowest annual sales since 2021.
Footfall was up 1.3% globally last year, however, growth which Quinones said IKEA wants to accelerate.
Decathlon Pilot Inside IKEA Croydon
A 1,188 square metre Decathlon store will open during the spring inside IKEA's 25,000 square metre store in Croydon, south London, IKEA said in a statement.
Leasing Terms and Brand Mix
IKEA will rent out the space, with its own entrance, to privately owned Decathlon, which is known for big-box stores that sell equipment from tents and bicycles to running shoes.
That will be the first time a major international brand is brought into an IKEA blue-box store, though smaller Nordic electronics retailer Kjell & Company opened in two Swedish IKEA stores during the autumn.
'AFFORDABILITY AND QUALITY'
Austria Pilot: Thomas Philipps at Klagenfurt
IKEA said it was also revamping its Klagenfurt location in Austria, where home and garden specialist Thomas Philipps will open a store.
"For this pilot, we have... selected tenants with broad appeal and a strong commitment to affordability and quality," said Quinones.
Future Opportunities in Europe and North America
He added IKEA was exploring similar opportunities in some additional countries in Europe and North America.
Investment Plan for 2024–2026
Ingka is investing more than 5 billion euros ($5.90 billion) during the 2024-2026 period to open new locations and improve existing stores.
Exchange Rate Reference
($1 = 0.8472 euros)
(Reporting by Greta Rosen Fondahn; Editing by Jan Harvey)
