1. How is the IKEA operations design different from that of most furniture retail operations?

The IKEA business idea is that “we shall offer a wide range of well-designed, functional home furnishing products at prices so low that as many people as possible will be able to afford them.” (Ikea.com.hk). Its unique operation design is different from most furniture retail operations. IKEA has a large supply chain and manufactured its furniture in various countries including developing countries such as China, which keep the production cost low enough. Besides, IKEA’s huge showroom (most are multi-level stores) contains restaurant, fast food corner, children playroom and toilets, which allowing customers to spend about two hours there, which is far more than other furniture retailers. According to the showroom layout, there are usually one main entrance and one main exit respectively. In addition, there are several sections including living room, bedroom, workspaces, children bedroom, kitchen, warehouse, etc. in the store. Restaurant and toilets could normally be found in the middle of the store in order to provide some places for customers to take a rest and then to continue their shopping journey. In each section, there are various “setting-out” displays in different sections. For example, in living room section, various living room settings in different styles such as country style or modern style, are displayed for customer’s reference and comparison. Warehouse section is usually located next to the cashiers at the exit. IKEA’s “showroom-warehouse” concept allows customers to pick up the furniture from the warehouse directly. Furthermore, most furniture of IKEA such as wardrobes, closets, bookshelves, etc. are flat-packed designed and being sold as self-assembly. The flat-pack design aims for easy transportation and reduce the transportation costs in relation thereto. Although IKEA aims to operate as self-service, customers could still ask for assistance at the customer services / information counters, if needed. And assembly service is also available with additional charge. 2. What do you think might be the major problem in running an operation like IKEA? According to IKEA’s unique concept, customers are encouraged to serve themselves in most of the time in their shopping journeys. It is necessary to provide sufficient knowledge, information and instructions for customers assisting them to shop in the stores following IKEA’s way. Brochures, catalogues and signs with clear descriptions and/or instructions are needed to be provided in the store for customer’s reviews and reference. Moreover, the layout of the stores is required to make difficulties for customers to deviate from the standard route through the store to the checkout. Under 1

children playroom. 3. the stock availability is an issue. Bibliography IKEA FAQ. staffs may need to provide addition assistance and help to those customers who do not behave in the prescribed manner.com/hk/en/customerservices /faq#faqAnswers4-5 [29 May 2011] 2 . Available. toilets. Customers can enjoy fast and convenience shopping experience by picking up the self-assembly flat-pack furniture from the warehouse. the sales function is mainly concerned with the sales part. Stocks should be always available. Separately. customers may need addition assistance and help when they confuse by the nature of the operation. when they change their mind and do not want them anymore. according to the IKEA’s “showroom-warehouse” concept allows customers to pick up furniture from the warehouse. they just leave them randomly in the stores which may case danger. information and instructions for customers. restaurant. most items are placed on the shelves and warehouse that allow customers to pick up by themselves. Difficulties may arise without sufficient and clear knowledge. the stock issue is very important.com Online. http://www. that is. Separately. For example. promotion and product selection. According to the IKEA’s self-service concept. etc. What do you identify as the “operations function” within IKEA? How is the different from the “sales function”? The general operation function of IKEA is concerned with serving customers with its furniture products. Items always out-of-stock would disappoint customers and extra costs is need to be paid for administration and ordering. Ikea.ikea. and the checkouts. In relation thereto. customers may change their mind after picking up kitchenware or towels from shelves or flat-pack furniture from the warehouse. focusing on selling furniture to customers. The sales functions include making decision of the price of furniture.some circumstances. To achieve the general operation function. there are specific operations are involved. The next one is concerned with the flow of materials. In this regard. warehouse operation and the shelf stocking operation are therefore involved. The first set of operations is concerned with the flow of customers through the layout of the IKEA stores from showrooms in different sections. Or. the respective goods inwards receiving operation.

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