Ikea records strong sales despite Covid-19 pandemic
Despite the coronavirus pandemic, Czech sales of Swedish furniture giant Ikea have remained strong. The biggest player on the Czech furniture market posted sales of CZK 10.3 billion for the period between September 2019 and August 2020, a drop by CZK 209 million on the previous year.
According to the company’s annual report for the Czech Republic, its profits reached CZK 1.14 billion, compared to CZK 1.25 billion in the previous term.
The favourable results were fuelled mainly by a surge in online purchases. In the period between September 2019 and August 2020, IKEA’s online sales in the country increased by 97.5 percent.
The total number of visitors to the company’s department stores fell by a tenth during the lockdown in April and May.
Over nine million people visited the four shopping centres in Prague, Brno and Ostrava in the period between September 2019 and August 2020. The company’s website was viewed by 11.5 million visitors, with 156,000 making an online purchase.
The company, which employs over 1,600 people in the Czech Republic, did not reduce their wages and didn’t lay off any workers.
The forced restrictions on domestic trade affected the results of the Swedish furniture giant only in the second half of its financial year, that is between March and August 2020. Last year's business results for the period between September and December will be reflected in next year’s report.
The sharp increase in e-sales caused the seller numerous problems with handling the orders and elicited frequent criticism. According to IKEA, its e-shop can handle about 30,000 orders a week. In the near future, the furniture giant plans to invest one billion crowns into digital infrastructure in order to improve its online services.
Ingka Group, the owner of most IKEA stores, also avoided significant negative effects on the economy, earning over 35.2 billion euros in the financial year 2020. Year-on-year, a few months of the pandemic cost her around 1.5 billion euros.