IKEA does not plan to raise prices in Russia

IKEA has no plans to raise prices in Russia in 2022, Pontus Erntell, CEO of the Russian branch of the Swedish furniture giant, said. There are no serious problems with the supply chain in this region: the company localized part of the production and launched the delivery of goods from Asia not by ocean, but by land.

The IKEA Russia CEO spoke about the financial results of IKEA Russia, as well as the fact that the Russian division does not plan to raise prices for goods, despite the recent warning about a possible price increase from the company's global representative office, at the annual press conference.

According to Erntell, Russia has almost solved the problem with the supply chain by localizing 50% of production. It is the problems with the supply of raw materials and goods that are the main reason for a possible increase in prices, the top manager noted. In particular, in order to solve this problem, in 2021 the company began to deliver goods from Asia to Russia by land and is now not dependent on interruptions in logistics across the ocean. The top manager also noted that in 2021 there were no “dramatic changes” in the prices of goods for Russia.

Pontus Erntell

CEO IKEA Russia

We do not have any kind of immunity from external factors, we will be guided by the situation, but now we have no plans to raise prices in Russia.

• For fiscal 2021 (counted from September 1, 2020 to August 31, 2021), IKEA sales in Russia increased by 31%. Now the Russian division occupies one of the leading positions among all countries. This year has been "one of the best years in the company's history," Erntell said.
• The share of the company's online sales in Russia grew from 11–12% to 20% over the year. The company expects that next year the segment will continue to grow to 22-23%.
• The number of own distribution points of the network reached 12.5 thousand. Now IKEA distributes goods not only through CDEK and DPD, but also through Russian Post and OZON branches.
• IKEA in Russia also continues to invest in offline development: in December, the world's largest IKEA store in the city format was opened in the Europolis shopping center in Moscow.
• A week ago, Inter IKEA CFO (brand owner and franchise manager) Martin Vandam announced that the chain was forced to raise prices worldwide. The top manager explained that this decision is due to the fact that IKEA continues to "focus on problems with suppliers, rising prices for raw materials and energy."