Swedish furniture giant Ikea is cutting prices across
hundreds of products in Europe to woo customers struggling with deepening
cost-of-living pressures. Ikea has seen revenue decline over the past two
years as the rising cost of living reduces people's ability to invest in new
furniture and home renovations. The company is spending €1.2bn (£1bn) on the
price cuts to items including the Billy bookcase and Kallax storage units, with
reductions of up to 28% on certain products. Ikea said it could make the cuts
by making savings throughout the supply chain, such as packaging costs, but
acknowledged profits may take a hit. Ikea has reduced its prices several times
in recent years, even as it caused a hit to the company's revenue and profit in
its most recent earnings report. The latest specific reductions vary slightly
by country. Price cuts for British customers include the Kallax shelving unit
going from £60 to £49 and the Billy bookcase being cut by £10 to £25.Ikea is
also trying to attract new customers by opening smaller stores in central
areas, such as London's Oxford Street and Churchill Square in Brighton.
BBQ - Is cutting prices a better strategy to increased advertising to increase demand?
