IKEA
had earlier stated that it was leasing more ships, purchasing containers, and
re-routing goods between warehouses to prevent supply chain interruptions, but
that it now had no choice but to pass the costs on to customers because the
turbulence is expected to continue.
IKEA, the world’s largest furniture
retailer, is boosting prices by an average of 9% as transportation and raw
material costs rise, according to the company that owns the majority of its
shops globally.
IKEA had earlier stated that it was leasing
more ships, purchasing containers, and rerouting goods between warehouses to
prevent supply chain interruptions, but that it now had no choice but to pass
the costs on to customers because the turbulence is expected to continue.
Prices will rise by about 9% on average
across Ingka Group’s markets, with local variances reflecting diverse
inflationary pressures, such as commodities and supply chain concerns.
“Unfortunately, we now have to pass
some of those extra expenses onto our customers for the first time since rising
costs have begun to affect the global economy,” said Tolga Oncu, Retail
Operations Manager.
“IKEA continues to suffer major
transportation and raw material restrictions, which are driving up costs, with
no predicted break in the foreseeable future,” the company said in a
statement, adding that it expects delays to last “well into 2022.”
During the epidemic, Ingka Group saw a
surge in demand as individuals stayed at home more. It is run on a franchise
system, with Ingka serving as the primary franchisee for brand owner Inter
IKEA, with 392 locations comprising city stores and 73 smaller shop layouts. Courtesy: www.retail.economictimes.indiatimes.com
