SWEDISH furniture maker Ikea has poured in P7 billion in initial investment for its landmark store in the Philippines, scheduled to open by the end of 2020.
The first Ikea branch in the country will cover around 65,000 square meters in Pasay City. It will be the largest of its kind all over the world, as it will house a warehouse, an e-commerce facility and an integrated call center.
Ikea Southeast Asia, a franchisee with the rights to own and operate Ikea stores in Malaysia, Singapore, Thailand and the Philippines, will make an initial investment of P7 billion to fit out, stock, market and staff the first store in the country.
The firm plans to hire 500 workers, and create hundreds of indirect jobs and business opportunities for its Philippine operations. SM Prime Holdings Inc. will serve as its leasing partner for the area the store will cover.
Future Manila Store Manager Georg Platzer on Tuesday said the country is a viable site to locate an Ikea branch given the Filipinos’ general knowledge about the brand. He added the population in general is conducive for business.
“We know there are a few million people here in the Philippines who know our brand already. About 13 percent of the people in greater Metro Manila already recognize the Ikea name,” Platzer said.
On top of retail, Platzer said the local Ikea store will be needing partners to assist in its operations. He specified logistics as one area the branch will be requiring from local firms.
“We are looking for local partners to help us build our retail business in the Philippines—businesses that share our values and work to the high ethical standards that we have at Ikea. We need people to support us in transport, waste management, food supply, recruitment services, digital marketing, home delivery and assembly, security, cleaning [and] sewing services,” he said.
Ikea Southeast Asia Managing Director Christian Rojkjaer explained the Manila store is the largest of its kind because it will also house a call-center facility and an e-commerce hub. He said because Filipinos love to shop, it is just right to build a store that can have “as many people as possible.”
“A typical Ikea store is around 35,000 square meters. The one we have designed will be around 65,000 sq m. That’s equivalent to more than 150 basketball courts,” Rojkjaer said.
Ikea, a Swedish-founded multinational company, is in the business of designing and selling furniture, appliances, and home décors and accessories.
Inter Ikea Systems BV owns the Ikea concept and is the worldwide Ikea franchisor. The brand is the world’s largest home-furnishing retailer, and as of August, 11 different franchisees were operating 422 stores in 50 countries.