'Despite high inflation, IKEA will keep products' prices low'

The group plans to invest Rs 10,500 cr to open 25 stores in India

Juvencio Maeztu, the India manager of Swedish furniture major IKEA, has said the company would charge low prices for its products here, despite high inflation.

“We are obsessed with low prices and these will get cheaper over the years…It is important for India. We will not compromise on that, regardless of high inflation,” Maeztu said at the India Retail Forum here on Wednesday. On Monday, IKEA announced it had filed the final document seeking permission to open stores in the country. The group plans to invest Rs 10,500 crore to open 25 stores in India.

“We don’t know yet what our plan is. At this point, there are many questions to be answered. We need time to understand,” Maeztu said, adding IKEA might have to develop new functions and tweak styles for the Indian market, though it wouldn’t change its four basic focus areas. “We will work on four things — democratic design, strong connection between sourcing and product development, store concept and people approach,” he said.

The company would combine pricing, design and quality to ensure the offerings were right, he added.

Maeztu said in India, the company would stick to the large format. Typically, IKEA stores are spread across 30,000 to a million sq ft. “We provide everything under one roof—about 9,000 articles in one place. We don’t sell only products, we sell solutions,” he said. On where it would find such big areas in Indian cities, he said, “I don’t know. We need to get approvals first.”

On some states protesting against the entry of foreign retailers, he said, “We will not rush. We need to get detail-by-detail information.”

IKEA was sourcing $500 million of products from India annually, Maeztu said, adding, “We hope to take it to $1 billion.”