KUALA LUMPUR: IKEA Malaysia is evolving its retail approach as changing consumer behaviour and digital shopping reshape how Malaysians shop for home furnishings.
The Swedish home furnishing retailer is strengthening its omnichannel model, combining physical stores, online shopping, home delivery and collection points.
IKEA Malaysia Country Retail Director Takeshi Murai said the upcoming Kuching store would reflect this approach.
The smaller format is designed around inspiration and product experiences as part of a wider shopping journey.
"We want the physical meeting point stores to be a source of inspiration, to be a source of touch and feel," he told Business Times.
BEYOND THE LARGE-FORMAT STORE
The shift does not mean IKEA is moving away from physical retail, but broadening how customers access its products and services.
Murai said IKEA wanted to get "closer and closer" to consumers, but this did not necessarily mean opening a traditional large-format store in every location.
He said the immediate focus was on making the Kuching store successful while the company explored other ways to improve accessibility.
In Ipoh, consumers can order IKEA products and have them delivered to an IKEA collection point.
The company is also developing services such as online interior design to expand digital channels in its retail ecosystem.
"We are trying not only to bring IKEA stores, which can sometimes take time, but also to bring IKEA closer to customers in other ways," said Murai.
IKEA's retail and product strategy is also being shaped by changes in how Malaysians live.
Murai said the company regularly visits homes and speaks to consumers about their needs and aspirations.
One major challenge identified was storage and organisation, particularly as more Malaysians live in smaller urban homes and apartments.
"So we are trying to support customers by providing solutions that fit into smaller spaces than in the past," he said.
Murai added that IKEA could draw on its global experience in small-space living, particularly from markets such as Tokyo, to develop solutions for Malaysian consumers.
KUCHING INTRODUCES NEW RETAIL FORMAT
IKEA Kuching, scheduled to open in December, will be the retailer's first store in East Malaysia.
IKEA Kuching will be smaller than IKEA Malaysia's existing large-format stores, reflecting efforts to develop different store formats for different markets.
Murai said IKEA was continuously exploring new ways of meeting customers, with its stores around the world differing in size and layout.
He said the Kuching format was being developed around the idea that physical stores should complement, rather than compete with, digital shopping.
"The concept brings together the physical store, online shopping, home delivery and collection points to provide customers with greater flexibility."
The new store is also expected to deepen IKEA's presence in East Malaysia while creating local employment opportunities.
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The majority of employees are being recruited in Sarawak, while some employees from Peninsular Malaysia have been brought in to provide operational experience and training.
"Our ambition is to develop the Kuching store together with Sarawak and the people of Kuching. That is why about 90 per cent of our recruitment is coming from local people in Sarawak," Murai said.
AFFORDABILITY REMAINS KEY
Affordability is still a major priority as consumers navigate changing household budgets.
Murai said IKEA had recently lowered the prices of multiple products.
More than 1,200 products are now priced below RM10, while more than 300 are priced below RM5.
He added that the retailer's integrated supply chain, from product design to logistics, helped it manage costs.
"When we design our new range, we introduce more than 1,000 new products. At the same time, we design the price together with the product."
Murai said global purchasing volumes also allowed IKEA to secure lower costs, supporting its low-price proposition.
He said affordability was not about sacrificing quality, design or sustainability, but delivering value for money.
"One of the advantages we have is that, by setting the volumes across all the countries and the world, we can secure lower costs. That is how we achieve low prices for customers.
"It's not only about the price. It's also about quality, design and sustainability."
POSITIVE ON IKEA MALAYSIA'S GROWTH
Looking ahead, Murai said he remained positive about IKEA's prospects in Malaysia as the retailer continued to make its products more affordable, accessible and sustainable.
While he stopped short of giving a specific forecast for the wider retail market, he said IKEA had continued to find better solutions during challenging periods.
"I have been through different times at IKEA, and every time things become more challenging, we find better solutions.
"I am looking forward to how we can develop our retail business to be closer to more people, to be more affordable for more people and to be more sustainable.
"I am very positive about it."
For Murai, IKEA's longer-term measure of success goes beyond store numbers or sales.
"Our goal is to create a better life for many Malaysians.
"If we can deliver one piece of IKEA product to every home in Malaysia, maybe I would call it a success," he added.
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