Here are IKEA's secrets to keeping its prices so low
- Shoppers love IKEA because of how affordable its furniture is. Many IKEA products cost about half the price of competitors.
- Part of why IKEA's prices are so low is that it packs everything flat to save on storage and transportation costs.
- See what else IKEA does to keep its prices so low.
Shoppers love IKEA because of how affordable its furniture is.
IKEA sells couches, armchairs, and tables for about half of what competitors do. At IKEA, you can buy a couch for under $500. But at other stores that specialize in home furnishings, like Pottery Barn or Crate & Barrel, couches typically cost at least $900, if not more.
But considering how low most of IKEA's prices are, the quality is surprisingly high. How is it able to keep prices so low?
A lot of it has to do with the way it designs each item. IKEA picks what they want to sell a product for before designing and manufacturing it, and the designers and suppliers work together to make sure the final product can be that price.
IKEA is also able to cut costs and keep prices low because of the way that it sells its products.
In 1956, IKEA founder Ingvar Kamprad introduced "flat packing," the method now synonymous with IKEA that cuts costs by letting consumers purchase their furniture in pieces and assemble it themselves. While it may be annoying to assemble furniture yourself, it allows IKEA to charge less for everything.
Here are the other things IKEA does to keep its prices low:
Source: IKEA
Source: Business Insider