By Jeannette Neumann | Bloomberg
Swedish furniture maker Ikea has cut prices on nearly 1,000 products in the US, including on its popular Billy bookcase, and plans to keep cutting.
“We are lowering prices on our most important products,” Jon Abrahamsson Ring, chief executive officer of Inter Ikea Group, the worldwide franchiser for the brand, said in an interview. “There are more to come.”
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The company began the US price-cutting push in January and is also lowering prices across the more than 60 other markets where it operates. Consumers have responded by increasing their purchases of those cheaper items at Ikea stores.
“If we hit the right product with the right price point, it really takes off,” Ring said. Consumers, he added, “are more price-aware.”
The furniture maker sells 9,500 products and raised prices across the board for the first time in decades during the COVID-19 pandemic because of supply-chain disruptions. Now, declines in the prices of raw materials and lower transportation costs have enabled the cuts, Ring said, as have productivity gains in the company’s supply chain.