IKEA: The Japanese Misadventure and Successful Re-entry

IKEA is one of the largest furniture manufacturers and retailers in the world and is well known for its stylish and innovative furniture designs.⁷ Almost all IKEA's products can be dismantled and packed in flat packages, making them easy to transport. IKEA began its international forays in the 1960s, and by 2008 it had a presence in around 35 countries⁸ across the world.

Though IKEA was highly successful in most of its international markets, when it came to Japan, its first venture was unsuccessful. IKEA entered the Japanese market in the 1970s, and exited the country in 1986.

According to Tommy Kullberg (Kullberg), former president and CEO of IKEA Japan KK (IKEA Japan), "We just were not ready to handle the very demanding Japanese market, and the Japanese customer was not ready for IKEA, and to drive things home and put it together themselves. It was a failure, no doubt about it."⁹

IKEA decided to re-enter Japan in the early 2000s and after thorough ground work opened its first store in 2006 in Funabashi. The store was highly successful and IKEA opened two more stores, in 2006 and 2008. On re-entering the market Kullberg said, "This time we have done our homework. We have been doing a lot of market research to understand how things work in Japan."¹⁰