Ikea to use Winnipeg store as testing ground for online ordering

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This article was published 23/05/2019 (1797 days ago), so information in it may no longer be current.

The arrival of Ikea in Winnipeg almost seven years ago was not only a big boost to the general psyche of the city and satisfying to the thousands of fans of its Allen wrench-assembled products, but as it turns out it also allows Winnipeggers to be exposed to one of the most enlightened commercial operations in the world.

Micheal Ward, who became president of Ikea Canada at the beginning of the year, was in Winnipeg on Friday to explain some of the sustainability and socially aware policies that drive the company.

Ward, who is a Canadian but spent the better part of the last two decades working all over the world for Ikea, believes the Canadian operations are going quite well. With new store openings in Quebec City last year and Halifax in 2017 there are now 14 locations in the country and Ward said there’s still the possibility of future developments here.

Besides its relative geographic isolation, Ward said there is really nothing unique about its Winnipeg store situation. However, because of the fact that it is so far away from other Ikea locations the company will use its store here to experiment with a slight alteration to its on-line order and delivery process.

There is more and more on-line shopping and Ikea is responding to those needs including addressing the important matter of how quickly it can deliver the orders to the customers’ homes.

“Our stores are set up to be supplied from big DC’s (distribution centres) with long trunk lines where the lead time is long and the cost is high,” he said.

The stores are large with lots of product on site and the company is now looking to get the stores to double as fulfillment centres.

“The warehouse is quite far away. The stores are right where they need to be,” he said. “But they are designed to take goods in. Now we’ll flip that and send product out from them. Winnipeg is one of the first places we are going to really try that in big way in Canada.”

The company does do very well in Canada with sales in this country of $2.4 billion last year which was up eight per cent with on-line sales up 18 per cent. Canada is one of Ikea’s top 10 countries and it has been able to successfully implement some of the company’s important environmental and social policies.

In an interview with the Free Press, Ward said, “First we recognize that we need to live within the limits of one planet. Not just Ikea, but all of us.”

Among other things the company has a goal of producing more renewable energy than it consumes. It owns a couple of wind farms in Alberta and runs its Edmonton store with one of the largest solar energy arrays in the province. Ikea Canada now produces four times more energy than it consumes. It has also committed to run its entire fleet of delivery vehicles with electric power trucks by 2025.

The company launched a program committing to hiring 250 refugees in Canada over the next three years. Jennifer Allen, the manager of the Winnipeg store, said it has already had 40 new refugees in for job experience and has hired 12 of them on.

The company is also committed to being a fully circular business by 2030. That means using and reusing materials. To partially accomplish that it has started a sell-back program which allows Canadians to sell their gently-used Ikea products back to the retailer in exchange for store credit and it is a founding partner and supporter of the Circular Economy Lab, a collaborative initiative to advance Canada’s transition to a circular economy.

Like every other retailer with a significant bricks and mortar footprint Ikea is aware of the need to build a robust e-commerce platform and that is in place. Ward said the company understands its customers desire for better convenience and new services from Ikea.

As far as service is concerned, last year it acquired a Silicon Valley company called Task Rabbit that maintains community platforms where busy people can find people to get things done for them… like put together their new Ikea furniture.

But what Ikea is not looking to do is increase prices or move up-market.

“It is all about affordability,” Ward said. “We have always believed people with small means should be able to have a beautiful home. That is our mission.”

martin.cash@freepress.mb.ca