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IKEA goes with smaller format in UK
I think this type of mixed-development would be great in Toronto! Think of the possibilities...Though with four stores in the GTA, I think we're pretty overserved as it is.
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Here's a pic
www.theretailbulletin.com...c.jpg[/img[/url]]
Sat 18 Jun 2005
Giant IKEA thinks small to expand in town centres
PETER RANSCOMBE
THE furniture giant IKEA yesterday unveiled radical plans for the first in a series of smaller stores in town centres across Britain.
The new shops are a departure for the Swedish retailer, which has previously opted for huge out-of-town warehouses.
An application to build a smaller store at Hillingdon, in West London, is expected to be submitted for planning permission within the next fortnight.
Scott Cordrey, IKEA's UK property manager, said: "The concept will be very different to anything we have built before in the IKEA world.
"This will be a benchmark for retailers in the M25 area, both in flexibility and environmental measures."
The new store, which will include a restaurant, will be about 20,000 sq m in size and laid out over three levels. The development also will include 240 one- and two-bedroom flats, with 170 of them classified as affordable housing.
The chain intends to build between eight and ten of the new smaller stores within the next three years.
A spokeswoman for IKEA said they have no immediate plans for a new store in Scotland, but that they have not yet chosen locations for the smaller shops.
The company already has two large branches in Scotland - one just off the Edinburgh city bypass and another at Braehead in Glasgow.
Last year, John Prescott, the Deputy Prime Minister, refused the furniture chain permission to build a £30 million store at Stockport, near Manchester, because it went against government policy on out-of-town shopping developments.
IKEA appealed to the High Court but the decision was upheld last March. In a statement released after the High Court decision the company said it would continue with its expansion plans.
The smaller stores are seen as a way around the planning policy. The firm has described its new format as "IKEA as we know it" but that it would involve "compromises on range presentation and office space".
Leigh Sparks, professor of retail studies at Stirling University, said: "The smaller size of the stores will inevitably mean a compromise on the number of products available. How they handle that will be an interesting choice, and what works and what doesn't work is something they'll have to find out through experimentation."
Prof Sparks thinks the new stores may make use of IKEA's home delivery service and could act as a shopfront for items that may not be held in stock in the smaller stores but would be available to order.
He added: "Much will depend on the mix of products in store. There is a danger that if existing customers go to the new stores and are dissatisfied with the range they find there then it could damage the brand."
Neil Mason, a senior retail analyst with Mintel, said: "This is an attempt by IKEA to modify its format to get planning consent and make itself more available to consumers in the UK.
"They've been a victim of their own success in some ways - they're just so popular. They have a winning formula and I see no reason why they can't repeat that with their smaller format stores."
He added that the Swedish firm's plan to start selling goods online also would appeal to shoppers who wanted to avoid the crowds in its existing 13 large stores.
I think this type of mixed-development would be great in Toronto! Think of the possibilities...Though with four stores in the GTA, I think we're pretty overserved as it is.
_____________________________
Here's a pic
![ikeahillingdonpic.jpg](http://[url=http://www.theretailbulletin.com/image_lib/ikeahillingdonpic.jpg)
Sat 18 Jun 2005
Giant IKEA thinks small to expand in town centres
PETER RANSCOMBE
THE furniture giant IKEA yesterday unveiled radical plans for the first in a series of smaller stores in town centres across Britain.
The new shops are a departure for the Swedish retailer, which has previously opted for huge out-of-town warehouses.
An application to build a smaller store at Hillingdon, in West London, is expected to be submitted for planning permission within the next fortnight.
Scott Cordrey, IKEA's UK property manager, said: "The concept will be very different to anything we have built before in the IKEA world.
"This will be a benchmark for retailers in the M25 area, both in flexibility and environmental measures."
The new store, which will include a restaurant, will be about 20,000 sq m in size and laid out over three levels. The development also will include 240 one- and two-bedroom flats, with 170 of them classified as affordable housing.
The chain intends to build between eight and ten of the new smaller stores within the next three years.
A spokeswoman for IKEA said they have no immediate plans for a new store in Scotland, but that they have not yet chosen locations for the smaller shops.
The company already has two large branches in Scotland - one just off the Edinburgh city bypass and another at Braehead in Glasgow.
Last year, John Prescott, the Deputy Prime Minister, refused the furniture chain permission to build a £30 million store at Stockport, near Manchester, because it went against government policy on out-of-town shopping developments.
IKEA appealed to the High Court but the decision was upheld last March. In a statement released after the High Court decision the company said it would continue with its expansion plans.
The smaller stores are seen as a way around the planning policy. The firm has described its new format as "IKEA as we know it" but that it would involve "compromises on range presentation and office space".
Leigh Sparks, professor of retail studies at Stirling University, said: "The smaller size of the stores will inevitably mean a compromise on the number of products available. How they handle that will be an interesting choice, and what works and what doesn't work is something they'll have to find out through experimentation."
Prof Sparks thinks the new stores may make use of IKEA's home delivery service and could act as a shopfront for items that may not be held in stock in the smaller stores but would be available to order.
He added: "Much will depend on the mix of products in store. There is a danger that if existing customers go to the new stores and are dissatisfied with the range they find there then it could damage the brand."
Neil Mason, a senior retail analyst with Mintel, said: "This is an attempt by IKEA to modify its format to get planning consent and make itself more available to consumers in the UK.
"They've been a victim of their own success in some ways - they're just so popular. They have a winning formula and I see no reason why they can't repeat that with their smaller format stores."
He added that the Swedish firm's plan to start selling goods online also would appeal to shoppers who wanted to avoid the crowds in its existing 13 large stores.