Swedish furniture chain IKEA will open its Israeli branch in Netanya on April 3, IKEA Israel general manager Dov Rochman announced today. The new 23,000 sq. m. store will have 60 show rooms, four model apartments, a restaurant-coffee shop, a breast-feeding corner, a playground, and a video room. Rochman would not disclose marketing objectives and the company’s Israeli marketing budget. He said that the store would operate on the principles of operating cost saving and low customer prices.
”Globes” has learnt that advertising firm Azimut will get IKEA Israel’s advertising account. Rochman said that the opening had been delayed by various constraints due to a lengthy setting-up process. The delay will apparently be reflected in the scope of sales in the pre-Passover shopping period. The Swedish chain decided to open a branch in Israel in 1993. In 1997 it chose Co-Op Blue Square as its local concessionaire, and in 1998 it appointed Rochman general manager IKEA Israel.
IKEA, set up in 1943, has 160 stores in 30 countries around the world. Four Israeli suppliers will join the chain’s 2,000 suppliers, Rochman said. The first is Mevo Hamma Mapal Plastic Products. He would not disclose the identity of the three other suppliers at this stage. IKEA’s sales in 2000 totaled $9.5 billion. Company sources expect sales to cross the $10 billion line in 2001.
Betili general manager Ofer Aitani said in response that the chain has taken extensive measures ahead of IKEA’s entry into the Israeli market: “We’ve upgraded our 14 branches, focusing on Italian designer products, so that 95% of our products are better than those sold by IKEA,” he said.
Ace-Kne u’Vne general manager said, “This isn’t the first time the chain has operated in the same market as IKEA. Competition keeps one on the ball, and is good not only for the consumers, but also for the chains themselves.”
Published by Israel's Business Arena on 4 February, 2001