Who owns IKEA? IKEA brand is owned by a holding company called Inter IKEA Holding SA. Inter IKEA Holding SA is also owned by the Interogo foundation, which is a non-profit foundation created to preserve Kamprad’s family wealth and support charitable initiatives. Ingvar Kamprad founded IKEA, the Inter IKEA Holding SA, and Interogo foundation. He could have retained the ownership of IKEA if he wanted, since he never sold out the company to anyone or allowed the company to become a publicly-traded company. However, he chose to transfer IKEA’s ownership to Inter IKEA Holding SA.
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History of IKEA
The furniture and home goods company known as IKEA was founded in 1943 by Ingvar Kamprad. The company started as a mail-order business that sells small items like pens, picture frames, jewelry, and wallets. Kamprad started selling cheap furniture in 1948. The furniture business boomed well, so he decided to offer only home furnishings in 1951. In 1953, he opened a showroom in Almhult, Sweden, and lots of people started to patronize him, especially because of how affordable his items were.
Kamprad’s competitors were unhappy when they discovered how affordable his items were, so they influenced Kamprad’s furniture supplier in Sweden to cease supplies to the IKEA company. Kamprad never allowed the situation to discourage him. Instead, he made contracts with foreign businesses to get materials for his company to design its own furniture. Most of IKEA’s products had some features that made them stand out. The company’s use of flat packaging is part of those unique features. The flat packaging made it very easy for customers to transport furniture, and it reduced shipping costs significantly. IKEA began to expand internationally to places like Europe, North America, and Asia between the 1960s to 1980s. Currently, the company operates in more than 50 countries around the world.
Brief History of Ingvar Kamprad
Ingvar Kamprad was born in Pjatteryd, Sweden. His entrepreneurial spirit had been active right from the time he was still very young. He began selling matches when he was just five years old. He founded IKEA when he was 17 years old. Although Kamprad didn’t attend a university, he displayed a high level of intelligence in various aspects of his life, especially in the management of his company. He had some unique business practices, including cost-cutting practices while maintaining efficiency. He believed that his company could offer high-quality products at very affordable prices if he cut production costs properly. And indeed, the practice worked well for his company.
Kamprad stepped down from the board of Inter IKEA Holding SA at the age of 87 years, but he continued to serve as an advisor to the board of directors even after he resigned. Kamprad died on January 27, 2018, at the age of 91. However, his legacy lives on as a hardworking entrepreneur who supplied stylish and functional furniture to people worldwide and revolutionized the furniture industry.
Influence of Inter IKEA Holding on IKEA’s success
Inter IKEA Holding had some significant impacts on IKEA, and here are some of those impacts:
Digital Innovation
Inter IKEA Holding supported franchisees to invest in digital technologies and e-commerce. This strategy enhanced the shopping experience for all customers who shop for IKEA’s products online. It even encouraged more people to patronize IKEA, as customers can go through the varieties of IKEA products right from their homes.
Sustainability Culture
Inter IKEA Holding made sustainability a culture in IKEA. Inter IKEA Holding was able to achieve this goal by encouraging franchisees to invest in renewable energy like solar power and wind to power IKEA factories. Inter IKEA Holding also ensured that IKEA reduced packaging waste to the least amount and utilize some recycled materials while manufacturing products.
Created a Positive Work Environment
Inter IKEA Holding promoted employee well-being at IKEA by introducing a number of initiatives, and one of them is the creation of a positive work environment. As a result of Inter IKEA Holding’s influence, IKEA’s workers enjoyed privileges such as flexible working hours and access to wellness programs.
Established the Franchise System
IKEA was able to expand at a fast pace as a result of the franchise system Inter IKEA Holding created. The franchise system did not only help IKEA operate in various countries, but also allowed the company to maintain a consistent brand. The customer experience at IKEA stores also remained consistent, as Inter IKEA Holding ensured that franchisees adhered to specific brand standards and guidelines.
Who Owns the Highest Voting Right in IKEA?
Interogo foundations, the parent company of Inter IKEA Holding, owns the highest voting right in IKEA. There are no shareholders of IKEA to partake in any voting activities, which is why the voting rights are in the hands of Interogo foundations.
It’s important to note that Ingvar Kamprad founded Interogo in 2016, which is several decades after he founded IKEA. However, he decided to transfer ownership of IKEA to the Interogo foundation to remove himself and his family from direct ownership. He believed the step was necessary to avoid potential conflicts of interest that might arise in the future and also ensure the long-term survival of IKEA. Interogo’s ownership of Inter IKEA Holding gives Interogo significant influence over IKEA’s operations. Here are the primary ways Interogo influences IKEA’s operations:
Financial Support
Interogo grants financial support to IKEA via Inter IKEA Holding. The funds that IKEA receives from Interogo help the company to operate efficiently.
Corporate Governance
Interogo implemented some policies to ensure that IKEA remains transparent, accountable, and ethical. It also emphasizes socially responsible modes of operation and sustainability.
Conclusion
Although IKEA’s corporate structure seems somewhat confusing, it’s important to note that Inter IKEA Holding owns the IKEA brand, concept, and franchise system. The holding has the right to license the IKEA brand and concept to franchisees. Inter IKEA Holding also sets standards for how IKEA stores should operate and provides assistance to franchisees when necessary to help them meet the standards.