IKEA's Strategic Shift in India

IKEA is undergoing a significant transformation in India as it plans to invest over ₹20,000 crore to expand its operations. The Swedish home furnishings giant is learning that Indian homes function quite differently than those in Europe, leading to a rethink in its merchandising and store strategy.

One major insight is that Indian consumers prioritize living rooms and bedrooms over kitchens. “We see much more living room and bedroom here than in Europe. The bedroom in India is a 24-hour room,” remarked Patrik Antoni, CEO of IKEA India. This shift in focus is not just about furniture preferences but about understanding how Indian households utilize their spaces.

Unlike Europe, where kitchens often serve as social hubs, Indian families invest more in living rooms for entertaining guests and in bedrooms that serve multiple purposes. This understanding is shaping IKEA’s domestic strategy, as it aims to increase local sourcing from 30% to 50% and plans to double its workforce in India to around 5,000 by 2030.

After establishing its presence in 2018 with large-format stores in cities like Hyderabad, IKEA is now shifting towards smaller formats in shopping malls, catering to evolving shopping habits. “People want everything here now, and they don’t want to go so far,” said Antoni, highlighting the growing trend towards convenience in shopping.

The home furniture market in India is booming, valued at $17.05 billion in 2025 and expected to grow to $34.24 billion by 2034. To capitalize on this growth, IKEA plans to have about 20 stores, with significant investments dedicated to mixed-use developments in Noida and Gurugram that combine retail with offices and hotels.

Delhi-NCR and Bengaluru are key focus areas for IKEA, driven by rising incomes and rapid residential growth. The upcoming Noida project, located near two metro lines, is set to open in 2028 and will include a hotel developed by SAMHI Hotels.

While facing competition from brands like Home Centre and Urban Ladder, IKEA is also expanding digitally into cities without physical stores, like Chandigarh and Jaipur. This strategy allows the company to gauge demand before making larger investments, reflecting changing consumer expectations for convenience.

Despite the growth in quick commerce, Antoni believes that furniture purchases remain planned decisions. “If you order a sofa, you will have it tomorrow. If you buy a table somewhere else, you often wait four weeks,” he explained, emphasizing the distinct nature of furniture buying.

India currently exports around €400 million worth of products to IKEA’s global network and imports ₹800 crore worth of goods. Increasing local production will not only strengthen India's global supply chain role but also make furniture more affordable for consumers, according to Antoni. This expansion will also necessitate a larger workforce, further contributing to the Indian economy.