Ikea spent 12 years studying India and visited 1,000 homes in major cities to see how its people lived. Today, as a few dozen early shoppers walked through the doors as the emporium opened in Hyderabad, the acid test began of whether the furniture giant understands what Indian consumers want.
“I have no plans to blow a lot of money today, maybe just buy some kitchenware, but this is going to be a destination for me,” said Rajani Venugopal, a businesswoman who waited about an hour and managed to be the first person in the doors.
Some 380 million Indians, a population bigger than the entire U.S., will join the middle class in the seven years through 2022. Ikea’s 400,000-square-foot Hyderabad store is the first step in the retailer’s plans for India, with more outlets scheduled to debut in Mumbai, Bengaluru and the New Delhi area soon after. By 2025, the company hopes to have 25 stores in the country.
“Ikea has an opportunity to pioneer modern retailing in the home improvement sector,” said Ankur Bisen, head of retail and consumer division at Technopak Advisors Pvt., an Indian consulting firm based near New Delhi.
India’s 1.3 billion people spend about USD30 billion a year on furniture and household items like bed linens and cookware, but 95 percent of those items are sold by small shops that offer custom-built products, according to Technopak.
What started as a trickle of shoppers at 10 a.m., when the store opened, had turned into a steady stream about an hour later. Ikea expects as many as 6 million visitors annually at the store in the Hyderabad suburb known as Hitec City, a town full of new apartment towers where multinationals like Amazon.com, Dell Inc. and Deloitte have offices. Bloomberg
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