By Emily Price
That Kallax bookshelf you’ve been eyeing at Ikea is potentially about to get a bit cheaper.
The furniture and meatball purveyor was forced to raise its prices during the COVID-19 pandemic as the cost of raw materials rose. Now that supply costs have started to become more accessible, the retailer is lowering its prices going into the end of the year and starting in 2024, the Financial Times reports.
Ikea’s sales are up 6.6% for the year as of August despite selling a lower volume due to its higher prices.
The company said that the current rise in interest rates means many of its customers are facing financial challenges. The hope is to maintain sales by lowering prices; however, company executives noted in the FT report that they were unsure less expensive goods would be able to stimulate consumption.
Beyond just selling built-your-own furniture, Ikea, which is operated by the Netherlands-based Ingka Group, has started to diversify its business in recent years, not only by opening locations in major cities but also offering services beyond furniture.
In April, Ikea launched a new room design service where customers can request to have a room or business designed with Ikea furnishings for a relatively nominal fee: $100 per room for personal spaces and $300 per room for businesses. Design sessions are handled virtually, and afterward, customers can purchase the items they want directly from Ikea or coordinate delivery, assembly, and installation with the company.
If you don’t want to work directly with a designer, the company also offers a mobile app where you can test drive how products will look in your own space.
The company has also experimented with creating a party-like atmosphere in its stores, including a rave that was reportedly shut down by the Italian police.
While other brands are cutting back with the specter of recession still looming, Ikea has been moving in the opposite direction. Ingka opened 60 new locations last year, including stores in major cities such as San Francisco and Copenhagen.
The company currently operates 537 stores of various sizes worldwide. Earlier this year, Ikea pledged to invest $2.2 billion over the next three years in the United States to better compete with other big-box retailers such as Walmart and Target.
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