Patrik Antoni, CEO, IKEA India, on Monday said the upcoming India-European Union (EU) free trade agreement is expected to benefit the company’s domestic operations significantly.
“The agreement would facilitate easier exports from India to Europe and lead to lower tariffs on imports from Europe,” he said at a media interaction in Chennai.
IKEA’s belief that fewer artificial barriers are better for companies and people in the long run, Antoni noted.
IKEA currently works with 44 suppliers in India, who supply products for both domestic and export markets. Currently, the exports are worth 400 million euros,” he said.
Regarding the sourcing, Antoni noted that approximately 30 per cent of the volume IKEA sells is currently sourced from India.
He noted that a lot of textile products are sourced from India due to the country’s strong history in textiles. “Additionally, plastic products are sourced, leveraging access to recycled plastic.”
Antoni highlighted that metal products, lamps and IKEA’s sofas are now being made in India and exported.
Mattresses are also being produced in Tamil Nadu for both the Indian and Middle Eastern markets, he said.
The company has started sourcing some Indian supply for flat-pack products, but it still has a long way to go, Antoni said.
The ambition is to increase this percentage of domestic sourcing as the company expands its retail footprint, which will create more opportunities for new suppliers, he said.
The company aims for large volumes and low prices, requiring more stores and shoppers in regions such as Tamil Nadu to engage more Indian suppliers, Antoni stated.
“Today, online contributes over 30 per cent of our sales and plays a vital role in helping us understand regional needs and everyday life at home, allowing us to strengthen our range and plan more thoughtfully for the future. The start of doorstep deliveries in Tamil Nadu is a natural next step in that journey,” Bhavana Jaiswal, Country E-commerce Integration Manager, IKEA India, said.
