IKEA set to open satellite mini-stores around South East Asia

In a recent article within the Nikkei Asian Review, the Swedish home furnishings juggernaut IKEA is in the process of setting up smaller more compact stores in smaller regional second –tier cities around Thailand such as Chang Mai, Udon Thani and more importantly Pattaya by 2021.

One such compact store already exists in Phuket and is roughly one-thirteenth of the size and cost of IKEA’s larger full-scale flagship stores such as the one in Bang Na, Bangkok. The overall concept works as follows, once a customer has surveyed all of the display items within the store, the customer merely orders the furniture items online. Then two or three days later the purchased items arrive at one of these regional satellite stores and the customer comes and picks them up. There’s also the added option of the customer opting for home delivery for an added fee.

The overall concept is pretty straight forward and cost effective, and more importantly these cost savings are invariably partly passed onto the retail buyer, which I’m sure we all agree is a good thing. So, in a nutshell thanks to the wonders of the internet and modern just in time delivery logistics IKEA can provide the same standard of service that we’ve become accustomed to for a fraction of the cost. Overall despite a slow start for the Phuket regional branch back in 2015, business has steadily improved to the point now that the store has been profitable ever since 2017.

The fact that IKEA plans to open up a similar store here in Pattaya by 2021 is welcome news for long term expats and Thai’s living in Pattaya, who had previously needed to drive over an hour by motorway to the nearest IKEA store in Bang Na which more often than not turned out to be both a tiring and all day long exercise. Also, given that IKEA has now firmly set its sights on Pattaya this finally gives us some much-needed variety and choice when it comes to furnishing our homes. Whereas the already established furniture outlets such as INDEX and SP Furniture will undoubtedly need to up their game to remain competitive in what is finally becoming a more competitive market sector which can only be good for the end consumer residing here in Pattaya.