The IKEA Phenomenon: More Than Just Furniture
If you've ever set up a college dorm room, built a home with your partner, or moved to a new country, chances are you've spent considerable time browsing IKEA furniture online. Even in India, where inexpensive labor makes the 'do-it-yourself' (DIY) concept a challenging sell, the Swedish giant has successfully captured the market's imagination.
Rajratna Jadhav, architect and professor at the Academy of Architecture in Mumbai, explains the brand's unique position: "The concept of DIY furniture is unique in India. In that sense, IKEA has a market space. However, in my understanding, IKEA's market is typically urban young professionals due to its modern and minimalistic styling and its light and quick assembly design."
The multinational conglomerate now operates stores worldwide, including six locations across India in Mumbai, Delhi, Hyderabad, and Bengaluru. But furniture represents only one aspect of IKEA's remarkable success story.
The Birth of an Empire: Ingvar Kamprad's Vision
The IKEA story began in the 1940s in a small Swedish town with its founder, Ingvar Kamprad. Born in 1926 in Älmhult, Kamprad grew up with his younger sister Kerstin and their parents Berta and Feodor. His entrepreneurial journey started early when he noticed significant price disparities during his school days.
He observed that pencils costing half an öre from wholesalers sold for 10 öre in grocery stores, sparking his interest in business efficiency. In 1943, after receiving a small sum of money from his father as a reward for academic excellence, the 17-year-old Kamprad founded IKEA.
The company name represents an acronym formed from his initials (I.K.) combined with the first letters of Elmtaryd and Agunnaryd—the farm and village where he grew up. According to Swedish writer Sara Kristoffersson in "Design by Ikea: A Cultural History," Kamprad initially sold various items including matches and pens before focusing exclusively on home furnishings.
The transition to furniture made perfect sense given his surroundings. Småland, his home county in Sweden, featured heavily forested areas with stony soil and numerous small furniture factories filled with skilled carpenters.
Per-Olof Svensson, Archive & Collection Manager at the IKEA Museum, highlights another crucial factor: "Right from the beginning, Kamprad observed what was happening in Swedish society: many people were moving from the countryside to smaller villages and larger towns. This movement created opportunities for people to start new lives, and relocating from one place to another often included the desire to build a new home."
The Food Revolution: How Meatballs Became Business Strategy
The period following IKEA's establishment proved exceptionally busy for Kamprad. He worked briefly as an office clerk and completed military service in Växjö, southern Sweden, while his business continued expanding. In early company brochures, he explained the secret behind IKEA's low prices: high turnover, direct factory deliveries, and minimal overhead costs.
Kristoffersson notes that IKEA began selling 'knock-down furniture' by mail-order in 1956—furniture delivered in packages for customers to assemble themselves. Two years later, the first physical IKEA store opened in Älmhult.
Daniel Yngvesson, Global Food Designer Inter IKEA Group, reveals that from the beginning, IKEA stores were strategically located outside cities—the iconic Swedish "blue box" requiring significant travel. "What Ingvar did was celebrate everybody who came to the forest and physically visited the store; he actually gave them a coffee and a cookie as a thank-you."
By summer 1960, the store had established a proper restaurant called IKEA Baren ('The IKEA Bar'). The company website explains the rationale: Kamprad noticed customers leaving at lunchtime to eat elsewhere, interrupting the buying process. He realized that hungry customers purchased less, coining the phrase, "it's tough to do business on an empty stomach."
Kevin Johnson, Country Food Manager at IKEA India, outlines three reasons for maintaining restaurants: "First, to demonstrate our affordability. Second, to showcase our Swedish heritage. And third, for families—IKEA is a family-friendly shopping destination. Globally, about 70 percent of our visitors are families, and it's likely similar in India."
The Iconic Meatballs: A Recipe for Global Success
The prosperous decades following World War II, known as Sweden's "record years," saw constant economic growth and rising consumer spending. People increasingly wanted to furnish homes according to personal tastes, creating a boom period for IKEA.
However, the 1979 oil crisis brought challenges. Sweden's heavy dependence on imported oil led to energy cost increases, inflation, and industrial pressure. Companies like IKEA faced cash-flow problems, forcing production streamlining and delayed investments.
This pause provided opportunity for reflection and reorganization. In 1979, IKEA launched twelve project groups comprising junior and senior coworkers from across Europe. One group studied restaurants in all twenty-three IKEA stores throughout the continent.
Swedish chef Severin Sjöstedt, part of this group, later developed the proprietary meatball recipe—the first recipe officially secured by IKEA. After extensive testing, including by Kamprad himself, the renovated restaurant concept debuted at IKEA Västerås in central Sweden with 175 seats. By 1987, all restaurants adopted the updated IKEA Restaurant & Café concept.
Today, IKEA sells over 1 billion meatballs globally each year, with chicken, vegetarian, and vegan versions joining the original. The vegan option debuted in 2020, expanding the menu's appeal.
Kristoffersson observes that "IKEA does not merely sell design. It sells Sweden and, indeed, Scandinavia too... while the products have names that associate them with Sweden or Scandinavia; and Swedish food is served in IKEA's restaurants under the device 'A Taste of Sweden.'"
Preserving Legacy and Expanding Horizons
The 1970s marked significant innovation and expansion for IKEA, with new store openings and iconic product introductions. During this period, Kamprad and his family relocated to Denmark. To preserve IKEA's culture, Kamprad documented the company's founding principles in nine points, creating "The Testament of a Furniture Dealer" in 1976—a document outlining crucial business cornerstones.
Today, IKEA food has grown into one of the world's largest grocery operations, serving over 700 million customers annually. Johnson notes: "While we have expanded into other markets—China, Japan, South Korea, and the US, about 35-40 percent of our range is locally tailored, allowing us to engage with a broader audience." He adds an internal company phrase: "There's no IKEA without food, and there's no food without IKEA."
Per-Olof Svensson and his team preserve this legacy at the IKEA Museum in Älmhult. "The vision behind the museum is, for us, to open up and share the history and journey of IKEA. But we also emphasize using history for learning... So it's not just a journey into the past—It's also about showing IKEA in the present."
Looking toward India's future, Jadhav suggests areas for growth: "Information in the public domain suggests that IKEA has been slow in its growth in India. I am informed that they would like to be more localized in their customer outreach rather than following the American model of a large store on the outskirts of a city, which they adopted in Hyderabad and Mumbai. This, I think, is a good strategy. Customers in urban India do not have time to spend half a day at a furniture shop."
He further advises: "To expand in India, IKEA would have to understand Indian needs beyond DIY, unless they would like it to continue to be their only focus... IKEA would have to work on the perception of longevity of their furniture to expand to other segments of the Indian customer base" beyond urban professionals.
From humble beginnings in Swedish forests to global dominance in both furniture and food, IKEA's journey represents a remarkable business case study. As the company celebrates forty years of its iconic meatballs, it continues evolving while staying true to Kamprad's original vision of affordable, functional design complemented by the unique dining experience that keeps customers returning worldwide.
