An IKEA store in Saint-Herblain, France, on March 22.STEPHANE MAHE/Reuters
The world’s biggest furniture brand IKEA is raising prices by an average of 9 per cent as it faces increasing costs in transport and raw materials, the owner of most of its stores worldwide said on Thursday.
IKEA Group had previously said it was leasing more ships, buying containers and rerouting goods between warehouses to mitigate supply-chain disruptions but said it was now having to pass on the costs to customers, as it forecasts that the turbulence to continue.
Ingka Holding BV, IKEA’s parent company, said prices would go up around 9 per cent on average across its markets, with local variations reflecting different inflationary pressures, including commodity and the supply-chain issues.
“Unfortunately now, for the first time since higher costs have begun to affect the global economy, we have to pass parts of those increased costs on to our customers,” Retail Operations Manager Tolga Oncu said.
“IKEA continues to face significant transport and raw material constraints driving up costs, with no anticipated break in the foreseeable future,” the group said in a statement, adding it expects disruptions to continue “far into 2022.”
Ingka has seen strong demand during the pandemic as people stayed at home more.
It operates through a franchise system, with Ingka the main franchisee to brand owner Inter IKEA with 392 stores including city stores, and 73 smaller store formats.
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