Ikea finally opens its largest-ever store in the Philippines
Defying the booming e-commerce and online shopping trend in Southeast Asia, Swedish furniture discounter Ikea on November 25 opened its biggest store in the world in the Philippines as cornerstone of the home-furnishings giant’s expansion plans of brick-and-mortar shops in Asia.
The store spans over 65,000 square meters or approximately ten football fields, which is larger than the Palace of Versailles in France or the Winter Palace in Russia’s St. Petersburg – to give an impression of the dramatic scale of the facility. It stretches across five floors in a complex nestled against Manila Bay.
The complex houses a two-level store area with showrooms and a food court, as well as warehouses, an e-commerce facility and a call center. It has been constructed on property leased out by SM Prime Holdings’ Mall of Asia in Pasay City.
Booming middle class with young professionals spending for homes and furniture
Ikea said the store – its first in the Philippines – is a good fit for a country with high growth rates and a booming middle class of young professionals looking to spend money on stylish furniture in homes newly purchased during a roaring property boom – despite challenges from the Covid-19 pandemic and the strong trend towards e-commerce.
That said, Ikea has been acknowledging this trend and has expanded its e-commerce presence with online orders now accounting for 26 per cent of its global sales.
But still, the company, which has more than 460 physical stores in about 60 markets around the world, is planning to add nearly 60 more locations in the current financial year ending August 31, 2022, not just in Asia, but also in South America.
“Revenge spending” in the Christmas shopping season
The Manila store was initially scheduled to open in 2020, but faced delays due to Covid-19-induced movement restrictions and the disruption of construction material supplies. The Philippine debut comes despite Ikea forecasting a more difficult year ahead in 2022, due to logistics logjams and price spikes of raw materials brought about by the pandemic.
Currently, the number of shoppers in the new store is limited to half the total capacity of 8,000, and they also have to register for a slot on Ikea’s website as a Covid-19 precautionary measure.
In the Philippines, for the next year or two, Ikea expects slower spending as Filipinos rebuild their savings, but expects consumer sentiment to gradually improve as the pandemic subsides. Still, in the near-term, there could be some sort of “revenge spending” by a population holed up at home during various lockdowns for the last 20 months venturing back into the outside world during the Christmas shopping season, the company reckons.
Defying the booming e-commerce and online shopping trend in Southeast Asia, Swedish furniture discounter Ikea on November 25 opened its biggest store in the world in the Philippines as cornerstone of the home-furnishings giant’s expansion plans of brick-and-mortar shops in Asia. The store spans over 65,000 square meters or approximately ten football fields, which is larger than the Palace of Versailles in France or the Winter Palace in Russia’s St. Petersburg – to give an impression of the dramatic scale of the facility. It stretches across five floors in a complex nestled against Manila Bay. The complex houses a two-level...
Defying the booming e-commerce and online shopping trend in Southeast Asia, Swedish furniture discounter Ikea on November 25 opened its biggest store in the world in the Philippines as cornerstone of the home-furnishings giant’s expansion plans of brick-and-mortar shops in Asia.
The store spans over 65,000 square meters or approximately ten football fields, which is larger than the Palace of Versailles in France or the Winter Palace in Russia’s St. Petersburg – to give an impression of the dramatic scale of the facility. It stretches across five floors in a complex nestled against Manila Bay.
The complex houses a two-level store area with showrooms and a food court, as well as warehouses, an e-commerce facility and a call center. It has been constructed on property leased out by SM Prime Holdings’ Mall of Asia in Pasay City.
Booming middle class with young professionals spending for homes and furniture
Ikea said the store – its first in the Philippines – is a good fit for a country with high growth rates and a booming middle class of young professionals looking to spend money on stylish furniture in homes newly purchased during a roaring property boom – despite challenges from the Covid-19 pandemic and the strong trend towards e-commerce.
That said, Ikea has been acknowledging this trend and has expanded its e-commerce presence with online orders now accounting for 26 per cent of its global sales.
But still, the company, which has more than 460 physical stores in about 60 markets around the world, is planning to add nearly 60 more locations in the current financial year ending August 31, 2022, not just in Asia, but also in South America.
“Revenge spending” in the Christmas shopping season
The Manila store was initially scheduled to open in 2020, but faced delays due to Covid-19-induced movement restrictions and the disruption of construction material supplies. The Philippine debut comes despite Ikea forecasting a more difficult year ahead in 2022, due to logistics logjams and price spikes of raw materials brought about by the pandemic.
Currently, the number of shoppers in the new store is limited to half the total capacity of 8,000, and they also have to register for a slot on Ikea’s website as a Covid-19 precautionary measure.
In the Philippines, for the next year or two, Ikea expects slower spending as Filipinos rebuild their savings, but expects consumer sentiment to gradually improve as the pandemic subsides. Still, in the near-term, there could be some sort of “revenge spending” by a population holed up at home during various lockdowns for the last 20 months venturing back into the outside world during the Christmas shopping season, the company reckons.
