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  • IKEA Problems & SWOT Analysis

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    NAWAL AWAD AL-ANAZZI
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    There were two major problems with IKEA's manufacturing operations. First, suppliers were found to be emitting excess levels of formaldehyde. Second, it was discovered that some rugs were being made using child labor in India and Pakistan. A SWOT analysis identified strengths like geographic presence and product variety, as well as opportunities such as expanding markets. However, weaknesses included potential criticism over waste and sustainability practices. Threats involved losing efficiency through poor inventory practices.

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    IKEA problems & SWOT analysis

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    There were two major problems with IKEA's manufacturing operations. First, suppliers were found to be emitting excess levels of formaldehyde. Second, it was discovered that some rugs were being made using child labor in India and Pakistan. A SWOT analysis identified strengths like geographic presence and product variety, as well as opportunities such as expanding markets. However, weaknesses included potential criticism over waste and sustainability practices. Threats involved losing efficiency through poor inventory practices.

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    © All Rights Reserved
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    6 views2 pages

    IKEA Problems & SWOT Analysis

    Uploaded by

    NAWAL AWAD AL-ANAZZI
    There were two major problems with IKEA's manufacturing operations. First, suppliers were found to be emitting excess levels of formaldehyde. Second, it was discovered that some rugs were being made using child labor in India and Pakistan. A SWOT analysis identified strengths like geographic presence and product variety, as well as opportunities such as expanding markets. However, weaknesses included potential criticism over waste and sustainability practices. Threats involved losing efficiency through poor inventory practices.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 2

    The major problems:

    There are two major problems related to IKEA manufacturing company firstly, the
    environmental wake up with Formaldehyde emission by the suppliers of IKEA
    was found to be in excess of the allowed limit. This was the first issue where
    IKEA because of being a low cost manufacturer of furniture outsourced its
    manufacturing.

    Secondly, identified that IKEA was involved in manufacturing rugs in Pakistan


    was using child labor to produce its rugs in India and Pakistan because the
    rugs were being manufactured by the suppliers and the company was
    unaware of the fact that child labor was involved.

    The SWOT Analysis:


    Strengths Opportunities

     The geographic presence in different  The organization can draw the criticism
    regions can act as one of the major from the environmentalists for its poor
    strengths of the organization. It waste management practices and
    determines the business’s reach to the inability to integrate sustainability in
    target market and ensures the easy business operations.
    accessibility.  The company may lose efficiency due to
     The wide product portfolio can allow the poor inventory management practices.
    organization to expand the customer The shortage or excessive inventory can
    base and offset the losses from one either result into
    product category with benefits obtained  The cash shortage or insufficient current
    from the other. assets negatively affect the liquidity
     Strong online presence on different social position and harms the overall business
    networking sites and efficient social performance.
    media management can enhance the
    effect of positive e-WOM and develop
    strong relationships with customers.
    Weaknesses Threats

     The organization can draw the criticism  The organization can draw the criticism
    from the environmentalists for its poor from the environmentalists for its poor
    waste management practices and waste management practices and
    inability to integrate sustainability in inability to integrate sustainability in
    business operations. business operations.
     The company may lose efficiency due to  The company may lose efficiency due to
    poor inventory management practices. poor inventory management practices.
    The shortage or excessive inventory can The shortage or excessive inventory can
    either result into either result into
     The cash shortage or insufficient current  The cash shortage or insufficient current
    assets negatively affect the liquidity assets negatively affect the liquidity
    position and harms the overall business position and harms the overall business
    performance. performance.

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