Swedish furniture retailer, Ikea is scouting for partners to source products for its stores in India and outside, as the company seeks to double its sourcing from the country by 2020.
“Make more in India for us is not to just produce and sell here. For us it means to design, and produce for Ikea in the world,” Juvencio Maeztu, CEO for IKEA India said while speaking at the India Economic Convention – 2015 organised by the industry body, Ficci.
As part of the plans the company has organised four seminars in the past few months, including one in Warsaw, Poland. At the three seminars held in Mumbai, Bangalore and Hyderabad, the company had invited local vendors and is now in the process of shortlisting them to be potential partners for sourcing.
At Warsaw, Ikea, had invited its Polish suppliers to set up plants in India to supply products for the company. “Thinking behind this initiative is to attract our Polish suppliers to come and join the Indian growth story and they will bring technology, skill transfer and employment,” Maeztu said.
Still, the company would face challenges in sourcing. The home furnishing supplier landscape is very fragmented in India with few industrialised setups, he said. And added another issue is the limited access to raw material.
Ikea, the world’s biggest home furnishing company, currently purchases 300 million Euro worth of products – mostly textiles – from India, and the company aims to double this to 600 million Euro, by 2020. Going forward, the company, which has been sourcing for 28-years now from India, also plans to buy products ranging from furniture, mattresses and also some of the raw materials required for its business. It plans to open 25 stores in India, with the first one expected to come in Hyderabad by end of 2016 calendar.