Modern Woodwork in conversation with: Sandeep Sanan, New Business Head, IKEA Purchasing, South Asia.
Founded in Sweden in 1943, IKEA is a multinational group of companies that designs and sells ready-to-assemble furniture, appliances and home accessories. IKEA owns and operates 400 stores in 49 countries.
IKEA had got FDI approval to set up a retail chain in India in 2013. IKEA has plans to open around 25 stores in India by the end of the year 2025.
IKEA has been sourcing from India for over 31 years and today works with close to 50 suppliers in India and doing business worth 315 million euros. The team is working on developing new categories like mattress, sofas, bookshelves etc. and exploring use of locally available sustainable materials such as bamboo, acacia, eucalyptus among others.
Modern Woodwork has brought an Exclusive Interview which comes out as enlightening and informative article – the conversations with Sandeep Sanan, New Business Head, IKEA Purchasing, South Asia.
Sandeep Sanan, New Business Head, IKEA Purchasing, South Asia
Sandeep has been with IKEA for over 15 years and is currently leading New Business Development in South Asia.
Over the last year, Sandeep along with his team have started sourcing various new categories from India for Global market. This includes Sofa’s , Mattresses & Particle Board Furniture. Currently, the focus is to start globally competitive supplier landscape on Metal and Wood (including Bamboo & natural fiber) categories for manufacturing home furnishing articles in India.
In the past, he has been responsible for the textile business in India and thereafter he worked in the Global Supply Chain for Textiles, and was based in Sweden (Almhult) for almost 5 years.
Before joining IKEA, Sandeep was working as a Consultant specializing in India Entry Strategies for International companies entering the Indian Market.
He believes in Sustainability as a pre-condition for creating business leadership. He has a firm belief that people ‘working together’ converts dreams into reality.
Modern Woodwork: Congratulations for IKEA’s entry in Indian market. Indians who are well versed with IKEA worldwide were keen to have you in India because they know you offer good furniture, at good price, and also offer a unique purchasing experience. Please tell our readers what is your plan for opening IKEA stores in various Metros.
Sandeep Sanan: Our priority is to implement the IKEA concept as it is working in other countries and to build stand-alone stores. Our stores will reach the many people with significant impact on logistics, employment, services and skill development. First store in Hyderabad in 2018,(40000 sq. mtrs) second in Mumbai.
We will have 25 stores by 2030. IKEA in India has a plan for 10,500 crores investment in the long run. There will be an Investment of around Rs. 500-700 crores per store in India that require 500-700 co-workers in each store. The concept is Large store sizes – equivalent to 6-7 football fields.
Modern Woodwork: When a global leader enters a market, it has the potential to change the way the industry works in that region. Tell us more about the IKEA philosophy that drives its success.
Sandeep Sanan: IKEA believes in Sustainable business. IKEA strives to have a positive impact on people and the planet – the sustainability strategy is to be People & Planet Positive. Sustainability is reflected across the business – from our sourcing to the range. We will build sustainable stores with low energy and water usage. Together with our suppliers we constantly working on minimizing their environmental foot print and improving the working conditions
IKEA foundation is working with community projects, mainly around children’s, empowerment of women and their health .
Next generation projects support social entrepreneurs to develop business and skills.
Modern Woodwork: IKEA got the approval to set up retail chain in India in 2013.What kind of response you are receiving from India since then?
Sandeep Sanan: IKEA is here for the long term, we will be providing beautiful home furnishing solutions for the many people to make life at home easier. We along with our customers are looking forward to the opening of the first store in Hyderabad.
Modern Woodwork: Can you share your plans to source the wooden products and furniture from Indian manufacturers? Do you have any specific strategies for vendor development?
Sandeep Sanan: Wood plan: We are working on developing new categories besides textiles with India as a manufacturing hub and have started mattress, sofas, furniture, appliances etc. Specifically for wood we are exploring use of locally available sustainable materials such as bamboo, rubber wood, banana barks, among others for our home furnishing offer. Working on sustainability we are working on FSC standards for suppliers. FSC is a voluntary certification system that provides internationally recognized standards, trademark assurance and accreditation to organizations, businesses and communities interested in responsible forestry management.
We work with our suppliers as partners based on Openness and Trust with them. Real partnership is built on mutual respect, openness and trust, and believes that our partners have just as much to offer in terms of competence and ideas as we have internally.Our partners’ capabilities and knowledge are true assets, and critical to IKEA’s long-term development. Together with our partners we listen to the needs of the many and increase our understanding of customer’s needs and behaviours.
Modern Woodwork : Main readership of our publication Modern Woodwork consists of small, medium and big Furniture factories. There is a visible excitement in our readers and many of them look forward to be official vendors of IKEA. They would like to know the exact criteria which makes them qualified to become a IKEAvendor.
Sandeep Sanan: We believe that IKEA partners are true entrepreneurs, who share our business model, our vision and values. This we call strategic fit. For more details log on to www.ikea.com
Modern Woodwork : Today Indian Furniture Malls are full of mainly imported furniture. What can Indian customer expect to get at IKEA stores as compared to these products?
Sandeep Sanan: It is our Promise to consumers: Well designed, functional and affordable products for the many people; Relevant products that mean something for everyone; a wide range of products at the most affordable price – “something for everyone”.
Modern Woodwork: What is your opinion about the Indian market in general and regarding the furniture buying patterns of Indian customers in particular?
Sandeep Sanan: IKEA, the Euro 38.3 billion company and the world’s largest furniture retailer is different. Founded by Ingvar Kamprad in 1943, the company, with 1,94,000 employees and operations in 49 countries, prides itself in its long-term vision. Its flat packs and value-formoney quality furniture have been its USP for many decades.
The retail market is always changing and challenging. Even as IKEA focuses on large-format stores we will also be setting up small retail stores in city centres. To meet the local customer needs we are looking at digital capabilities, including mobile-based sales platforms.
Customers world over are looking at quality and affordable products for their homes. IKEA provides all opportunities for functional products for the many people.
Modern Woodwork: India is a vast market and also there are lot of challenges like people are not used to DIY furniture – how will IKEA tackle the challenges of logistics and installations?
Sandeep Sanan: DIY is our model and we are proud pioneers of the Do it Yourself model. However we will provide support to customers for assembling the products in India.
Modern Woodwork: How do you feel the buyers from Tier two cities will be able to avail IKEA products?
Sandeep Sanan: IKEA is for the many people, we believe our products are for all even with the thin wallets. There is something for everyone.
We wish IKEA the grand success in all their endeavours in Indian market.