The Magic of IKEA Food: How a Swedish restaurant took IKEA to new heights of success


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When you think of furniture, the Swedish company IKEA immediately comes to mind. It’s no surprise that they’re the world’s largest furniture retail brand, raking in a staggering $42 billion in revenue in 2021 from their 458 stores worldwide. 

But here’s a little-known fact that might surprise you: IKEA is also the 10th largest food seller outside the US and ranks among the top 50 food chains globally. Say what?! So, why on earth would a furniture retailer venture into the food business? And why do people actually dine at IKEA? Let’s dive into the fascinating world of IKEA’s culinary journey!

Does IKEA really sell a lot of food?

Yes! IKEA’s food business across various bistros, cafés and restaurants makes a whopping ~$2.5 billion in sales annually! IKEA’s food sales account for 6% of its total revenues and have been growing at 8% annually since 2016.

But, why does IKEA even sell food?

IKEA’s food business wasn’t a random experiment, but a well-thought out strategy to drive their furniture sales.

IKEA stores due to their size are usually located in the city outskirts and far from where regular restaurants are located. So, the initial idea was to provide food to customers in the store so that they hang around for longer without having to go outside for a lunch or snack break.

IKEA’s founder, Ingvar Kamprad, very succinctly makes the point, “Hungry customers buy less”.

These food stores were not intended to be profit-centres. The idea was to lure in customers with low-priced, tasty meals that would end in them making big ticket furniture purchases.

In essence, IKEA’s food halls serve two purposes –

  1. Increase the footfall i.e. drive more number of visitors
  2. Extend the time shoppers spend in the store leading to big ticket purchases

Got it! So, how much impact does the food business have on IKEA’s furniture sales?

Let’s take the example of the IKEA restaurant in Hyderabad, India to understand how big an impact the restaurant has on furniture sales.

  1. IKEA Hyderabad restaurant has 1000 seats, and is open for 11 hours between 9:30AM to 8:30PM on all days of the week.
  2. Let’s conservatively assume that the restaurant has negligible rush for 5 hours, peak rush filling 40% seats for 3 hours and normal rush filling 20% seats for 3 hours.

Number of visitors who come to IKEA primarily to eat food

  1. So, total number of daily visitors to the restaurant = # of hours x # of seats filled = 3 x 400 + 3 x 200 = 1800
  2. Assuming the restaurant runs for 350 days in a year (accounting for national holidays),
    # of visitors to IKEA restaurant annually = 1800 x 350 = 630,000
  3. Now, IKEA Hyderabad store had ~2 million visitors in 2019-2020. So, 630,000 / 2,000,000 x 100 = ~32% visitors came to the store for food!

In fact, IKEA learned a while back that ~30% of their visitors across the world come to the stores to primarily eat food.

So, out of the 775 million visitors to all IKEA stores in 2021, 775 x 30% = ~233 million people primarily came to eat.

That’s great! But, is there anything special about IKEA’s food?

IKEA opened its first self-service cafeteria in 1958 with only coffee and cold dishes. Since then it serves not just hot snacks and a la carte dishes but also offers packaged, frozen and refrigerated food & beverage items.

But, about half of the items on IKEA’s menu are Scandinavian. IKEA food rose to its stardom for its meatballs, lingonberry jam and salmon. It is estimated that IKEA sells around one billion meatballs per year!

Of course, many items on the menu are customized as per the demographics of the store. For instance, you can eat spiced chicken curry and rice at the Hyderabad store.

Apart from meatballs, are there other reasons for people to prefer eating at IKEA?

Yes! IKEA food is easy-on-the-wallet and tasty. 

Consider this – English breakfast at IKEA includes eggs, potatoes, beans, tomatoes and meat and costs just RM4.99. Compare this to McDonalds where a Big Mac meal costs you RM13.40. IKEA Damansara store in Malaysia offers 2 bowls of Mee Kari and Mee Rebus for RM7.00. That’s half the usual price for these items even at pocket-friendly restaurants.

Finally, where is IKEA going with this?

The roaring success of the food business did prompt IKEA executives to try several standalone pop-up restaurants in 2017, in major cities like London, Paris, and Oslo. However, in 2018, IKEA said that no long-term decision on standalone restaurants was taken. IKEA’s external innovation lab, Space IO, is in the process of creating healthy, plant-based and sustainable food options – “fast food of the future”. But, this is limited to culinary research and is not on IKEAs menu. At least for now. IKEA’s restaurants are an integral part of its business and here to stay. Whether the company takes it to the next level of its promised potential – we will have to wait and watch.

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