Introduction of Ikea free essay sample

Introduction of IKEA IKEA   is a  privately held, international home products  retailer  that sells  flat pack  furniture, accessories, and bathroom and kitchen items in their retail stores around the world. The company, which pioneered flat-pack design furniture at affordable prices, is now the worlds largest furniture retailer. [3] IKEA was founded in 1943. Currently, the company is owned by a  Dutch-registered foundation that is believed to be controlled by the Kamprad family. IKEA is an acronym comprising the initials of the founders name (IngvarKamprad), the farm where he grew up (Elmtaryd), and his home parish (Agunnaryd, in  Smaland, South Sweden). [4] INGKA Holding B. V. is the parent company for all IKEA Group companies, including the industrial group Swedwood, which commissions the manufacturing of IKEA furniture coming from any manufacturer worldwide (outsourcing), the sales companies that run IKEA stores, as well as purchasing and supply functions, and IKEA of Sweden, which is responsible for the design and development of products in the IKEA range. We will write a custom essay sample on Introduction of Ikea or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page INGKA Holding B. V. is wholly owned by  Stichting INGKA Foundation, which is a  non-profit  foundation  registered in  Leiden, Netherlands. The logistics centre europe is located in  Dortmund, Germany. Inter IKEA Systems B. V. in  Delft, also in the Netherlands, owns the IKEA concept and trademark, and there is a franchising agreement with every IKEA store in the world. The IKEA Group is the biggest franchisee of Inter IKEA Systems B. V. Inter IKEA Systems B. V. is not owned by INGKA Holding B. V. , but by Inter IKEA Holding S. A. egistered in  Luxembourg, which in turn is part of Inter IKEA Holding registered in the  Netherlands Antilles. The ownership of the holding companies has not been disclosed | | |[pic] | |In Hong Kong, the IKEA business started as early as in 1975. Then in 1988 Jardine Pacific acquired the franchise. The acquisition of IKEA (Hong Kong) and IKEA (Taiwan) by | |The Dairy Farm Company Ltd in 2002 brought new opportunities for business growth. With the rich retailing experience and expertise of The Dairy Farm Company Ltd, and on the| |strength of the companies histories, IKEA is ready to take off into an even brighter future. | |Today, we are one of the market leaders in home furnishing and lifestyle products. There are  3  IKEA stores in Hong Kong, giving a total retail area of 210,000 sq. ft. , where| |you can find a huge variety of functionally designed items at low, low prices. By buying in larger volumes, we can lower the prices, so our customers can save even more. |This web site gives you just a small glimpse of our exciting range there is much more at our stores! Come and be inspired and give your home a facelift! | | | Visual merchandising tips Retail visual merchandising shares many of the same principles as advertising, graphic design, and interior design — the purpose of visual merchandising is to create a logical and visually pleasing environment that will grab attention and trans late into increased sales. Visual merchandising basics are pretty easy to understand — a clean store, well lit, with merchandise displayed in neat groupings. But visual merchandising can delve deeper, focusing on the how your customers might think, feel and react to the environment that youve created. The following are a dozen tips for retail visual merchandising: 1. Take It Outside If the weathers good and youre allowed to do so, set up a display of merchandise outside your store. This can create a sense of excitement and buzz. 2. Identify Everything Customers are in a hurry. Use signage to identify not only departments but categories — this will help customers pinpoint what they need and inspire additional purchases. . Set The Mood With Your Windows Store windows are incredibly valuable merchandising territory: use them to set the mood of the event or sale youre having. This mood should match the mood your customers want to experience after buying from you: do they want excitement, romance, serenity? 4. Embrace All The Senses Great merchandising appeals to more than the eyes. Consider how your store sounds, smells, and even feels : are all of these messages youre sending with music, scents, and other environmental factors in keeping with the displays you create? You can evoke senses without addressing them directly. For example, putting a pair of red bowls and spoons with a display of a tomato soup can get mouths watering! 5. Show Them How It Will Look At Home Use your displays to show customers how the merchandise will look in their home. For example, if youre selling jewelry, present it in the gift box, perhaps with some curls of ribbon still clinging to the box a row of pans hanging neatly. Many customers cant envision merchandise in application — when they see a pan in a box, for example, they see a pan in a box. But put that same pan on a faux stovetop, with a cheerful checkered potholder and a pair of wineglasses nearby with a stack of cook books, and suddenly that pan is something more: its a potential romantic dinner for two, just waiting to be whipped up. 6. Group Like With Like Organize your store logically: customers should be able to find all of one type of merchandise easily. Create groupings within categories, so all the merchandise that is one color, type, price or size is positioned together. 7. Group By Lifestyle Display merchandise from several categories that all share the same theme — in the appropriate environment setting. For example, in an office supply store, a display could reflect the workplace of a high-tech wizard, pairing together the right steel and glass desk with cutting edge accessories centered around the computer, or a classic CEO suite, with old school green glass lamps on a heavy walnut desk, replete with blotter. 8. Use the Spotlight Lighting attracts customers, much like moths to the flame! Dramatic lighting doesnt have to be expensive: well placed spotlights can draw attention to key pieces of merchandise. Make sure to use spotlights within your store as well as in the windows! 9. Change Your Displays Often! A great display is a great display — the first time the customer sees it. But what if the customer sees that same display next week, and the week after that? Suddenly the display is not so great. Its boring; the same-old, same-old. Customers dont come back to boring stores! Plan on changing your displays with the seasons. Even better is to do so weekly. 10. Use color Strong color can have strong results: plan your displays around a central color that pops and captures the customers attention. Try to have a different color every season (or every week if you can). If youve used yellow as your central color this season, go with purple or blue next time — not red or orange. 11. Integrate Motion Merchandise that moves will catch the eye. If you have anything that moves — from clocks to toys to music boxes, take one out and set it up. Let customers see it working. If your merchandise is more static, bring motion into the store with a mobile, fan, etc. 12. Remember the Rule of Three Whenever you create a display, work in sets of three. If youre arranging merchandise by height, have a tall, taller, tallest. If something is squat and round, have a fat, fatter, fastest. You can even group by price: good, better, best displays works surprisingly well. Category Management  is a retailing concept in which the range of products sold by a  retailer  is broken down into discrete groups of similar or related products; these groups are known as product categories (examples of grocery categories might be: tinned fish, washing detergent, toothpastes). Each category is run as a mini business (Business Unit) in its own right, with its own set of turnover and/or  profitability  targets andstrategies. Introduction of Category Management in a business tends to alter the relationship between  retailer  and  supplier: instead of the traditional adversarial relationship, the relationship moves to one of  collaboration, exchange of information and data and joint business building. The focus of all supplier negotiations is the effect on turnover of the category as whole, not just the sales of individual products. Suppliers are expected, indeed in many cases, mandated to only suggest new product introductions, a new  planogram  or promotional activity if it is expected to have a beneficial effect on the turnover or profit of the total category and be beneficial to the shoppers of that category. [1] The concept originated in  Grocery  (Mass merchandising) retailing, but has expanded to other retail sectors such as  DIY,  Cash and Carry,Pharmacy/Drugstore and Book retailing. [2] Contents | |  [hide] | |1  Definition of Category Management | |2  Rationale for Category Management | |3  Definition of a Category | |4  The Category Management 8 Step Process | |5  Category Captains | |6  Governmental concerns about Category Management | |7  Category Management Association | |8  See also | |9  References | [edit]Definition of Category Management Category Management lacks a single definition thus leading to some ambiguity even among industry professionals as to its exact function. Three comparative mainstream definitions are as follows: Category Management is a process that involves managing product categories as business units and customising them [on a store by store basis] to satisfy customer needs. (Nielsen)[3] The strategic management of product groups through trade partnerships which aims to maximise sales and profit by satisfying consumer and shopper needs  (Institute of Grocery Distribution)[4] [a] .. marketing strategy in which a full line of products (instead of the individual products or brands) is managed as a strategic business unit (SBU). (Business Dictionary)[5] The Nielsen definition, published in 1992, was a little ahead of its time in that customising product offerings on a store by store basis is logistically difficult and is now not considered a necessary part of Category Management; it is a concept now referred to as  micromarketing. Nevertheless, most grocery retailers will segment stores at least by size, and select product assortments accordingly. Wal*Marts Store of the Community, implemented in North America is one of the few examples of where product offerings are tailored right down to the specific store. [6] [edit]Rationale for Category Management One key reason for the introduction of Category Management was the retailers desire for suppliers to add value to their (i. e. the retailers) business rather than just the suppliers own. For example, in a category containing brands A and B, the situation could arise such that every time brand A promoted its products, the sales of brand B would go down by the amount that brand A would increase, resulting in no net gain for the retailer. The introduction of Category Management imposed the condition that all actions undertaken, such new  promotions, new products, re-vamped  planogram, introduction of  Point of Sale  advertising  etc. were beneficial to the retailer and the shopper in the store. A second reason was the realisation that only a finite amount of profit could be milked from price negotiations and that there was more profit to be made in increasing the total level of sales. A third reason was that the collaboration with the supplier meant that suppliers expertise about the market could be drawn upon, and also that a considerable amount of workload in developing the category could be delegated to the supplier. [7] [edit]Definition of a Category The Nielsen definition of a category, used as the basic definition across the industry is that the products should meet a similar consumer need, or that the products should be inter-related or substitutable. [8]  The Nielsen definition also includes a provision that products placed together in the same category should be logistically manageable in store (for example there may be issues in having room-temperature and chilled products together in the same category even though the initial two conditions are met). However, this definition does not explain how the process often works in practical retailing situationsm, where  demographic  or marketing considerations take precedence. [edit]The Category Management 8 Step Process [pic] [pic] The Category Management 8 Step Process The industry standard model for Category Management is the 8-step process, or 8-step cycle developed by the Partnering Group. [9]. The eight steps are shown in the diagram on the right; they are  : 1. Define the Category (i. e. what products are included/excluded). 2. Define the role of the category within the retailer. 3. Assess the current performance. 4. Set objectives and targets for the category. 5. Devise an overall Strategy. 6. Devise specific tactics. 7. Implementation. 8. The eighth step is one of review which takes us back to step 1. The 8-step process, whilst being very comprehensive and thorough has been criticized for being rather too unwieldy and time-consuming in todays fast-moving sales environment; in one survey only 9% of supplier companies stated they used the full 8-step process. [10]  The current industry trend is for supplier companies to use the standard process as a basis to develop their own more streamlined processes, tailored to their own particular products[11] Market Research company Nielsen has a similar process based on only 5 steps  : Reviewing the Category, Targeting consumers, Planning merchandising, Implementing strategy, Evaluating results. [edit]Category Captains It is commonplace for one particular supplier into a category to be nominated by the retailer as a Category Captain. The Category Captain will be expected to have the closest and most regular contact with the retailer and will also be expected to invest time, effort, and often financial investment into the strategic development of the category within the retailer. In return, the supplier will gain a more influential voice with the retailer. The Category Captain is often the supplier with the largest turnover in the category. Traditionally the job of Category Captain is given to a  brand  supplier, but in recent times the role has also gone to particularly switched-on  Private label  suppliers. [12] In order to do the job effectively, the supplier may be granted access to a greater wealth of data-sharing, e. g. more access to an internal sales database such as  Walmarts Retail Link. [edit]Governmental concerns about Category Management Many governments have viewed increased collaboration between suppliers and retailers as a potential source of  antitrust  breaches, such as  price fixing. For example the UK  Competition Commission[13]  has raised their issues on market distortion in principle. They have also acted on milk price-fixing in Britain. [14] [edit]Category Management Association The Category Management Association (CMA), is a professional Association with members that come from a broad range of strategic insights and planning functions. It connects members with category managment peers around the world, is a central resource for catman information and best practices, and is the only group certifying coursework and category management professionals according to recognized industry standards. It was formed in 2004.