IKEA, the global furniture and home décor giant, has announced a major strategic move to significantly amplify its sourcing operations in India. The company aims to increase local sourcing for its domestic retail business from the current 30% to 50%. This initiative forms a crucial part of IKEA’s long-term strategy to deepen its commitment to the Indian market while simultaneously strengthening its global supply chain.
IKEA Strengthens Its Supply Chain with Indian Sourcing
India currently ranks among IKEA’s top ten sourcing countries for its global operations. The company sources approximately €400 million worth of products annually from India. These products primarily include textiles, plastics, and metals, which form a substantial portion of IKEA’s global assortment. Recognizing India’s vast potential, IKEA now plans to expand its sourcing portfolio by adding new product categories like sofas, mattresses, and storage furniture.
This strategic expansion demonstrates IKEA’s confidence in India’s manufacturing capabilities. By diversifying its sourcing categories, the company can ensure better cost-efficiency and reduce dependency on limited geographies. Furthermore, this move aligns with IKEA’s efforts to make its global supply chain more resilient and future-ready.
Transitioning Towards Sustainable Cotton Farming
In addition to increasing product sourcing, IKEA continues to champion sustainability in its operations. The company actively works with over 110,000 farmers across India to source sustainable cotton. Through these collaborations, IKEA promotes agricultural practices that reduce the use of pesticides, fertilizers, and water. This initiative not only protects the environment but also boosts yields and farmer incomes.
As the demand for sustainably sourced materials rises, IKEA’s investment in eco-friendly farming reflects its global commitment to environmental responsibility. By incorporating sustainable cotton into its products, the company ensures quality and sustainability go hand-in-hand.
More Jobs and Economic Opportunities in India
As IKEA scales up its sourcing from India, it also contributes to economic growth and employment generation. Increasing local sourcing to 50% will create a significant number of jobs across the Indian supply chain. This includes employment opportunities in manufacturing, packaging, logistics, and other supporting sectors.
In turn, this job creation strengthens local communities and boosts economic development in sourcing regions. IKEA’s focus on inclusive growth ensures that its success in India also benefits the wider ecosystem of suppliers, workers, and local partners.
IKEA’s Expanding Retail Footprint in India
Since its entry into the Indian market in 2018, IKEA has steadily expanded its physical presence. The company launched its first store in Hyderabad and has since opened additional outlets in Navi Mumbai and Bengaluru. These large-format stores offer a wide range of home furnishings, lifestyle products, and sustainable solutions tailored to Indian consumers.
Looking ahead, IKEA plans to expand into the Delhi National Capital Region (NCR), where it is actively developing new retail spaces. These expansions reflect IKEA’s confidence in the growing demand for affordable, stylish, and functional home products in India’s urban centers.
Aligning Retail Growth with Local Sourcing
By increasing local sourcing, IKEA ensures its retail growth aligns with India’s manufacturing capabilities. Sourcing more products domestically not only shortens lead times but also helps the company maintain pricing competitiveness. Additionally, local sourcing allows IKEA to respond faster to market demands while supporting the Indian government’s vision of self-reliance and manufacturing excellence.
This strategy demonstrates IKEA’s ability to combine global scale with local adaptation. As the company deepens its roots in India, it becomes an integral part of the country’s retail and supply chain ecosystem.
A Long-Term Commitment to India
IKEA’s decision to amplify sourcing from India represents more than just a business move it signals a long-term commitment to the Indian market. Through increased local sourcing, sustainable partnerships, and retail expansion, IKEA is investing in India’s future while driving value for its global operations.
By balancing global ambition with local impact, IKEA continues to position itself as a responsible, forward-thinking leader in the global home furnishing industry.
