International Journal of Scientific & Engineering Research, Volume 5, Issue 3, March-2014 1170

ISSN 2229-5518

The Supply Chain of the IKEA Company
Hamad Mohammed Abouhenidi
Abstract — This Research is based on the supply chain of the IKEA Company, which is the largest retailer company, which deals
with the furniture appliance. IKEA Company have the strong and larger supply chain system in the world but due to the supplier
issues, IKEA Company faced many problems because suppliers are the backbone of any organization and they provide their good
and service at the international level. With the help of international logistic which deal with the inflow and out flow of the IKEA
Company product and with the help of supply chain management we can collaborate with the suppliers and solve the problem of the
IKEA Company (Jonsson, 2012).

1 INTRODUCTION
based on the effective supply chain of the good. for

I KEA is retailer companies, which deal with the the effectiveness companies have to pay money for
designing and selling of the ready to assembly the update of technology as well as linked all the
furniture and belong to the Swedish country. It is function with supply chain because if one function
world largest furniture selling company and have of the organization changed then the whole system
the name at international level will be disturbed and the company will not be
achieved their targets Bozarth, C. (2013).The
The product line of IKEA Company effective management of the supply chain is based
on the maximum customer’s values as well as

IJSER
sustainable competitive advantage. The maximum
 Furniture appliance
customer value can be achieved though analyzing
 Bookcase ranges
the demand of the customers that what they have
 Curtain accessories
demand related to the products and how can an
 Children items
organization fulfill the demand of the customers. If
 Bathrooms articles
the company will successful by analyzing the
 Home accessories
demand of the customer then they can get the
 Kitchen articles
maximum customer values. Other is sustainable
 Upholstered furniture
competitive advantage, its means retain the
customer for a lifetime and understand their
These are the product line of the IKEA Company. demand related to the innovation and delivery of
Based on this product line IKEA collect the greatest the product then a company gets the sustainable
revenue as well as famous at the international level competitive advantage which give the value to the
due to their quality product. Supply chain is a organization. See diagram number 1.
process which deal and run the whole organization
function in a chain and the flow of the good is
depend upon the supply chain that how to use the
1.1 ISSUES AND PROBLEM
raw material then process it and the main thing
how much produced for the delivery of the good. The main issues and the problem of the IKEA
Supply chain is the mixture of the both science and Company is the supplier selection because they do
arts subjects. In science, scientifically calculate the not supply the goods in an effective and all the
advantage, disadvantage and the quantity of the thing is done due to lack of collaboration and
goods, which tell about the network, and the flow coordination. If there is good collaboration and the
of the goods. Supply chain analyzes the market coordination among all the partners of the
demand related to the products and then starts the company then they can easily deal with all the
production function according to the demand of function of the company as well as it improves the
the product. The concept of the supply chain based productivity of the IKEA Company.
on the two ideas one is produced the products and
reached to the end user which have the demand of  Coordination in the traditional businesses
the product. Secondly, it is a long-term process of within the company its means that the
the organization because it linked with the all company should be coordinate outside the
function of the organization that is why for the company before staring any work for the
effectiveness and efficient production of the good organization. In addition, coordinate

IJSER © 2014
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your supply chain strategies and your reward That is why it create problem to meet the structures to achieve the sustainable competitive demand on international level. (2013). the supply chain run smooth supply chain which helps for the needs to be managed based on realized demand. human resources. (2013). members of the IKEA Company. The top management a days. Therefore. partners in the non-core competency functions and achieves synergy. have the cannot achieve their target of sustain able smooth production to cut the cost and have the competitive advantage if coordination is stock due to mass distribution at multinational strong then ultimately other department will level and planning horizon is medium due to be linked with each other. minimal product The IKEA Company use the strategy of aligning customization and high product value density. See diagram number 2. However. inflow and out flow the material of IKEA Therefore in push based strategy firstly we Company Antley. this advantage defined that the supply chain strategies. analysis the need of the customer and the make . In addition. This is the win then the other partner ultimately will be major problem which IKEA Company facing now win and get the benefit. T. number of configuration designed for market with Because without the coordination a company the large production size. On the production as procurement department of the other hand. C. In supply chain. Volume 5. prefer the collaboration and coordination strategy before 2. If the strategies will company should used those policies which not match with the structure then the entire system gives them to meet the demand at the both of the organization will be disturbed. IKEA Company follow the supply company because without coordination a chain strategy that is build to stock in which the company cannot create a chain within all customer segment is online and popular function.2 ALIGNING SUPPLY CHAIN WITH THE IKEA company use out-of. sales. However. the collaboration with modification Handfield. Issue 3.International Journal of Scientific & Engineering Research. The level international and the domestic level strategies of the companies are the asset of the because the company have the first right to company because the strategies are used by every meet the demand of the domestic level then organization but how to manage that strategy and think about the international level for the produce the maximum output is not the common better export of the goods Bozarth. due to there are senior manager of all function and all the supplies problem the relationship between a location that is why if they will aligning their company and its customers is going to be loose strategy with the structure then IKEA Company and demand uncertainty is high. logistics. for the better utilization of the COMPANY STRUCTURE product. STRATEGIES furniture appliance. Therefore. so the IKEA the structure of the company. change the production level with some little  On the other hand. Moreover. The IKEA Company has the largest supply chain management in the world according to the 2. the out of market strategy is Limited local demand. product to meet the need of the customer. 2. (2013). March-2014 1171 ISSN 2229-5518  inside the traditional functions of the planning to make the outlet and design the marketing.market supply chain strategy. in all the organization for example. if the strategy will not match with the structure of the organization then it The IKEA Company use the push based strategy to will create problem for the IKEA Company.1 Push based strategy doing any work. is liable to differentiate the customer segment IJSER and handle the entire segment appropriately. In which firstly This strategy will be helpful for the IKEA discussed about the coordination that how to Company because this supply chain strategy with coordinate all the functions and after then all the attributes of this company and the leading collaboration with the partner on the basis of time is also long from manufacturing to stocking win-win situation means if one partner will be locations and short to customer location. the first condition is configuration and the product are based on small to link all the function with each other’s. must be link with with international demand. strategy create hurdle in the way of dealing which are used by the company. maintain the relationship with the customers as Because IKEA Company has flat structure in which well as collaborate with all the partners and the they gives the preference to all the employees. R.

R. (2012). However. Retrieved March 5. March-2014 1172 ISSN 2229-5518 http://scm.net/publication/242082 4. which will cut the 5.ncsu. (2011). 2012).International Journal of Scientific & Engineering Research. 2014. from http://www. (2013).ncsu.edu/scm- customization. (2013). Operations and Supply Chain international level related to the retailing of the Management. Retrieved March 5. CONCLUSION management-education-entertainment-hotels- temporar The IKEA Company dealing with the largest supply chain due to have the large business at the Bozarth. 2014. Global supply chain planning at (Jonsson.ncsu. which help to increase the value of the product and useful for Handfield. from . we cannot link the function and without the collaboration we cannot satisfies their Handfield. Retrieved March 5. Volume 5. 2014. T. Retrieved March used the renewable recourses.edu/scm- cost of the company as well as provide the articles/article/trends-and-strategies-in-logistics- products for the customers at the reasonable prices. C. B. BIBLIOGRAPHY 768_Global_supply_chain_planning_at_IKEA Antley. Retrieved March 17. Trends and Strategies in partners of the organization and the last thing the supply chain strategies must matched with the Logistics and Supply Chain Management: An organization structure. there are some points are more articles/article/inventory-fundamentals- important for the IKEA company because without operations-and-supply-chain-management the coordination. from IJSER Company can control the problem related to the supply of the good and deal with the international http://scm. and-supply-chain-management-an-interview Use the sustainable practices. R. Issue 3. Sustainable Supply Chain Management. The Supply Chain IT competitive advantage. 2014.edu/scm-articles along with the dealing of the domestic level Jonsson. IKEA. from http://scm.ncsu.edu/scm- articles/article/sustainable-supply-chain- 3. from furniture appliance and does the work on http://scm. this IKEA Investment Enigma.researchgate. P. 2014. (2013). IKEA company should be Interview with Robert Handfield.