IKEA expands store formats and second-hand market amid Swedish job cuts

IKEA is implementing a multi-faceted strategic shift involving physical expansion, digital second-hand markets, and operational restructuring. The company plans to open approximately ten smaller, compact stores in Sweden over the next three years, targeting smaller cities and suburbs to increase accessibility. These locations will offer a curated selection of products, food services, and digital planning tools.

In the circular economy sector, IKEA is expanding its second-hand marketplace. The platform allows IKEA Family members to buy and sell used furniture directly. In some regions, sellers can opt for a 15% bonus when receiving proceeds as IKEA gift cards. This initiative aims to extend product lifecycles and compete with platforms like Vinted and eBay.

However, these expansions coincide with labor challenges in Sweden. The company has announced the loss of 60 positions at its Älmhult distribution center due to the relocation of goods handling to Torsvik. The union Handels has criticized the decision, stating that the company has not lived up to the ‘IKEA spirit’ regarding employee security and dialogue during the transition.