Undeterred by taxes, IKEA puts together cheap India pricing

Want a discount on an IKEA couch? Take a trip to India.

[AD EXCLUSIVE] First look at the IKEA store in Hyderabad

Actually it's my wife who got me here.

"They seem very reasonable", he concluded. "I don't think it will give us much competition".

For each store it opens, IKEA plans to have between 800-1,000 co-workers, which will be a mix of internationally experienced workers and locally recruited.

Price is a key factor for the Swedish chain as it plunges into India, a huge new market where the average annual salary is less than $2,000.

It will offer 7,500 affordable, value for money home furnishing products and 1,000 products will be priced below Rs 200. The 400,000-square-foot furniture and home decor showroom will house around 7,500 products, created to integrate within an Indian home but reflective of the Swedish furniture retailer's clean, minimal sensibility and aesthetic. For the Hyderabad store, an investment of Rs 1,000 crore has been made. Let's see whether it rules the interiors of Indian homes soon.

And this piece suggests that the food inside the IKEA store in Hyderabad would be easy on the pocket too.

Speaking to CNNMoney two hours after the store's 10 a.m. opening, Achillea estimated that almost 3,000 customers had already come in.

Bringing its world-class shopping experience to India, Ikea has designed the store in a manner which tempt customers into buying something after a long walk through 400,000 square feet store that is the equivalent of 10 football grounds.

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"I lived in Singapore for six years, so I knew about IKEA. It's a big store and you need to have some energy boost halfway through", Osterstrom added.

Many Indians are used to having their furniture built by local carpenters, so Ikea is tweaking its business model to suit the market.

September 13, 2016: Ikea says it's started construction of its first store in Hyderabad and is also looking for land in cities such as Delhi and Bangalore.

The company's efforts in India haven't been without hiccups.

January 1, 2012: India's government abandons a rule against foreign single-brand retailers operating stores without a local partner, paving the way for global companies including Ikea.

Ikea's 13-acre (5.3 hectare) inaugural site will be on the outskirts of the southern city of Hyderabad, where the company said it expects to generate up to seven million visitors per year. The launch of the Hyderabad store was initially scheduled for mid-July but was postponed because of quality concerns.

Ikea, which reported revenues of $39 billion in 2017 globally, exports €350 million of product from India and has 50-plus suppliers. "One is the Swedish unique range and one is the local range", the company said.

Speaking to India Today, Peter Betzel, CEO, IKEA India said that the company thanked the Telangana government for its tremendous support. "We are not opening a store, we're opening a country".

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