KUALA LUMPUR: IKEA Malaysia is focusing on consolidating and optimising its existing stores in response to softer consumer sentiment and inflationary pressures – particularly in key markets such as the Klang Valley, Penang and Johor – while strengthening its omnichannel strategy.
IKEA Malaysia country retail director Malcolm Pruys said the home furnishing brand will continue to expand its reach through its omnichannel network, including collection points and online stores, to better serve customers in areas where it does not have a physical presence, such as Kuching, Ipoh, Malacca, Kuanta and Terengganu.
“A key milestone was the launch of our dedicated East Malaysia online store, supported by a central fulfilment centre in Kuching. This enables faster delivery by facilitating packing, assembly and shipping of online orders.
“Our e-commerce platform reflects IKEA’s commitment to accessibility, making it easier and more affordable for Malaysians to enjoy the comfort and functionality of our products, while strengthening our presence in East Malaysia.
“Together, these efforts ensure that more Malaysians can access IKEA wherever they are, however they choose to shop – always at prices they can afford,” Pruys told SunBiz.
He noted that FY24 was a challenging year across the global retail sector, with Malaysia feeling the impact of rising inflation and higher living costs. “These macroeconomic pressures have affected consumer confidence and, in turn, our overall performance.”
Despite these headwinds, IKEA Malaysia has prioritised affordability over passing on rising costs to customers.
“We have lowered prices on some of our most popular and essential products and introduced tiered delivery pricing starting as low as RM10, making it easier for Malaysians to access IKEA regardless of their budget,” Pruys said.
When asked about IKEA Malaysia adapting its business strategy to reach new markets, such as the recent move to expand into Sarawak and enhance accessibility in East Malaysia, Pruys said the brand recently launched a dedicated e-commerce platform for Sabah and Sarawak, supported by a central fulfilment centre and collection point in Kuching.
“This allows customers in East Malaysia to access our best-selling products at the same affordable prices as in Peninsular Malaysia, with faster delivery and greater convenience. This expansion is part of our omnichannel strategy to make IKEA more accessible through both digital and physical touchpoints,“ he added.
Elaborating on how Malaysia fits into IKEA’s overall Southeast Asia growth strategy, Pruys said the country is a key market in the region, both strategically and operationally.
He said Malaysia is home to one of IKEA’s largest regional distribution centres, and customers here have a deep-rooted love for the brand.
“The country’s growing middle class, urbanisation trends and increasing digital adoption present strong growth opportunities. That said, the retail landscape is evolving quickly, rising costs and changing consumer behaviours are challenges we must navigate.
“But with a strong foundation, an agile omnichannel strategy and a passionate team, we believe Malaysia will continue to play a pivotal role in our regional expansion,” Pruys said.
Elaborating on IKEA Malaysia’s plan to ensure the long-term success, Pruys said Blueprint 2025 is the brand’s roadmap to stay relevant and resilient in the face of today’s economic challenges.
“At the heart of this strategy is the IKEA commitment to affordability. As household budgets tighten, we’ve lowered prices on a range of our most popular products not as a promotion, but as a long-term promise.
“We believe now is the time to invest in pricing, not profit, so more Malaysians can create better homes, no matter their budget.
“We are also focused on expanding our omnichannel presence, and we’re growing both our digital and physical reach, including adding more EVs to our delivery fleet to support sustainable, last-mile fulfilment.
Currently, we have three electric vehicles on the road, with a further 10 newly purchased and expected to be operational in the year ahead, as part of our journey towards 100% sustainable deliveries by 2030.
Highlighting IKEA Malaysia’s progress and challenges in transitioning to a fully electric vehicle (EV) fleet for last-mile deliveries, Pruys said IKEA Malaysia’s goal is to fully transition to EVs or other sustainable transport solutions for its home deliveries to customers by 2030.
However, challenges remain, particularly in terms of infrastructure limitations, the availability of charging stations and the cost associated with maintenance.
“IKEA Malaysia is also investing in more charging infrastructure across IKEA stores nationwide to support our growing EV fleet and ensure efficient last-mile delivery operations. The transition is a learning journey, but one we are fully committed to for the benefit of the many people and the planet.
“We cannot achieve our goals alone, nor do we have all the answers. By working closely together with suppliers, partners, and like-minded organisations, we can find innovative solutions to reduce our environmental impact and build a more sustainable future,“ Pruys said.
