IKEA WILL open its new superstore in Dublin in the summer creating up to 500 jobs. Anders Dahlvig, chief executive of Ikea, said yesterday the store would be a fantastic success despite the fact that the Swedish furniture giant had missed the Celtic Tiger.
"We have wanted to come to the Republic of Ireland for a long time because we see it as a fantastic opportunity for Ikea," he told The Irish Times. "We have an offer that will suit the Irish people very well and the experience from our Belfast store is very positive."
However, Mr Dahlvig, who is responsible for Ikea’s global operations, strongly criticised the lengthy delay the company had experienced in setting up in Ireland. The Ikea store was more or less completed last month but has been standing idle because the road infrastructure on the M50 was not deemed to be adequate and has had to be upgraded.
“I don’t think we have ever had a store ready and operative that has to stand idle. We invested in all this infrastructure, we put millions and millions of euro into this and then we have the frustration of having this long negotiation with the road authority,” he said.
Ikea has been given clearance to open in the summer and will agree a date this week, according to Mr Dahlvig, who refuses to reveal an exact date but hints at “early summer”.
He said the new employment opportunities would be important for Ireland in the current economic climate. It would also mean more taxes being paid to the exchequer, said Mr Dahlvig, who added that Ikea’s Belfast store was attracting a lot of business from the South.
He said it would have been better for Ikea to open during the boom years of the Celtic Tiger because home furnishing retailers were more reliant on the housing market. He insisted though that Ikea took a long-term perspective when it came to store openings.
“It is better to open when the economy is up because you get a quick start, but over the long term, it does not impact on our decision-making because the time lag from decision to opening a store is so many years. So it is impossible to predict an upturn or downturn.”
He said the current downturn was sharp and was affecting all regions of the world, but Britain and the US were probably the two most affected regions. He said Ikea sales were up 5 per cent in the year to date, which compared to growth of 15 per cent last year.
“We are doing better than most of our competitors and I’m not particularly worried. In many ways a downturn is good for Ikea . . . other competitors go bust, they sell less than us and we take market share,” Mr Dahlvig said. He added that it was an opportunity to attract a lot of new customers into the store that would normally shop on the high street.
He said downturns brought down the cost of energy and raw materials and had a positive impact on margins, yet the media tended to focus only on “doom and gloom”.
He did not think the entry of Ikea to the Irish marketplace would push rival furniture retailers out of business, a process known as “the Walmart effect”.
“I have never experienced that. I think people consume more on furnishings when Ikea comes to a market. The market, as such, increases,” said Mr Dahlvig.
He hopes to travel to the Republic to attend the launch of the new superstore during the summer.
