Ikea Announces Closure of Ghatkopar Outlet, Shifts Focus to Worli, Navi Mumbai, and Pune Stores
Mumbai, 23rd February 2024: In a significant move, Ikea, the global furniture retail giant, is set to close its 72,000 square foot store located in Mumbai’s R-City Mall by July. This marks the company’s first closure of this nature in the Indian market, impacting over a hundred employees currently stationed at the Ghatkopar outlet.
On Thursday, employees were informed about the impending closure and were given the option to relocate to Ikea’s Worli or Navi Mumbai locations. Some may also transition to the expanding online team, showcasing the company’s commitment to adaptability in its workforce.
An Ikea India representative confirmed the Ghatkopar store’s closure, stating it aligns with the company’s strategic goal to establish a more agile and efficient retail operation in the country. “This decision enables us to explore new avenues for future expansion while streamlining our Mumbai operations to Ikea Worli, Ikea Navi Mumbai, and online presence,” the representative added.
The closure announcement coincides with Ikea’s recent revelation of contemplating its next phase of investment in India, having nearly exhausted its initial investment of INR 10,500 crore. The Ghatkopar location, situated on the third and fourth floors of R-City Mall, reportedly fell short of meeting Ikea’s standards for an optimal customer experience, according to Financial Express.
While specific sales figures for the Ghatkopar store were not disclosed, industry analysts speculate that the move is part of Ikea’s strategy to minimize losses in the Indian market. For the fiscal year ending on August 31, 2023, Ikea India reported a substantial 61% increase in net sales, reaching INR 1,768 crore. However, the net loss for the same period surged to over INR 1,134 crore, compared to the previous year’s losses of INR 901 crore.
Ikea has also been bolstering its online presence, expanding from six sites to covering 62 districts across Maharashtra, Karnataka, Telangana, and Andhra Pradesh. Major cities like Mumbai, Bengaluru, Chennai, Hyderabad, Pune, and Surat have been key focal points.
Looking ahead, an Ikea India representative stated that the company is channeling its efforts towards expanding its physical footprint in Pune, introducing new omni-channel formats in Mumbai, and transforming the Navi Mumbai location into a prominent shopping destination for consumers.
