The clock is ticking for Sudhir Wadhwa. He owns Idiya, Aotearoa’s largest parallel importer of IKEA products, and he has about 2000 bits of flat-packed Scandinavian goods worth $5 million at his facility in Pōkeno.
“We probably won’t be able to sell it once IKEA is here, so we’ll be putting up a large sale to basically clear our stuff,” he said.
Wadhwa was prepared for the impending arrival of the Swedish furniture giant, which is due to cut the ribbon at its first New Zealand store in Auckland’s Sylvia Park before Christmas.
Despite the floor-to-ceiling flatpacks, Wadhwa wasn’t losing sleep over IKEA’s arrival — he’s had two years to adjust. Instead of trying to compete, he’s steering his business in a different direction, bringing in premium products from other global suppliers.
Likewise, Maggie Yu, owner of Auckland-based parallel importer Good Furniture, says her business will stop selling IKEA products once the Swedish brand arrives.
“IKEA’s BILLY bookcase series is very popular here. Many customers use it not only as a bookshelf but also as a display case for personal collections like LEGO… we are considering similar alternatives.”
Wadhwa acknowledges the popularity of IKEA’s bookcases, wardrobes and storage solutions and says many of his customers have hit pause on their purchases, waiting for the brand’s official launch: “That’ll probably help IKEA have a good start.
“IKEA doesn’t have a mandate to stop us from parallel importing, but it’ll be stupid to compete with them… overall, I think IKEA coming to New Zealand will be a net positive for the economy and for everyone.
“The whole category of furniture and homeware from international manufacturers will get a boost, the whole thing will become affordable, and everyone will start buying it and it actually helps. As a business, you just need to find your own niche and your own strength.”
Wadhwa has already started moving away from IKEA products, focusing on higher-end furniture and broadening his range to bits from Italy, Brazil and Turkey.
“IKEA will probably be a prominent player in the budget category when they come, so we’ll be getting more premium products in and concentrating on that other side of the market which they don’t cater to.”
Mocka, “the pioneers of flatpack in New Zealand”, were once an online-only retailer, but recently opened up their offerings at Adairs in Sylvia Park (where IKEA will be), and have expansions planned in Hamilton and Christchurch.
Brisbane based chief executive Kat Williamson says: “We’re excited for what a global company like IKEA can bring to the visibility of the design, the joy and the love of flatpack, and being able to bring affordable design to customers”.
Williamson says Mocka has been refreshing its online offerings, launching a new website at the end of last year. The move isn’t a direct response to IKEA, but part of a broader strategy to enhance customer experience.
Local furniture and homeware businesses have indicated they’re not worried about IKEA’s arrival, but should they be?
Retail strategist Chris Wilkinson thinks they’re right to be optimistic.
“In the past, retailers would consider a competitor coming in nearby as very impactful, but now what we see increasingly across all retail categories, is by grouping like and complementary businesses together, you create a very powerful destination.”
Wilkinson said the introduction of IKEA could light “a fire in consumers’ minds”.
“Walking through there, you’re inspired by the room settings, the design flair, and that gets you in the mindset to be doing something, spending some money.
“In many cases, it won’t be where that journey ends. You may see something and think, ‘oh that’s great, but I can’t afford it’, or ‘I wouldn’t mind spending a bit more and getting something different’. We do know in terms of the consumer psyche; that’s the typical trend that happens.”
By RNZ’s Jogai Bhatt
