2024-04-24 23:30:00
While resale sites are posting thousands of offers on their products, Swedish retailer IKEA has had no choice but to offer price drops of up to 45% on more than 800 of its items.
Looking at the list of products affected by this offensive, more than 650 are among those that cost over $80. That’s 200 for less than $20. For example, those who might not afford a Millberget chair may revise their plans. IKEA is offering it now for $179, a discount of $150.
On the other hand, some price drops are not as exciting. Like a cabinet base reduced by $12 from now $921 or a TV stand reduced by $20 from a price of $840. Discounts not worth the trip, especially if the same product is available on a resale site at an even better price.
“People are shopping much further in advance to get a better discount,” explains Michel Rochette, president of the Quebec section of the Retail Council of Canada (CCCD).
Everyday match
IKEA has for several years been a popular store due to its affordable products, although assembling furniture can be an Olympic test for some customers. However, since the pandemic, resale sites have been flooded with tables, chairs, furniture, shelves and sofas from this company.
Is the Swedish offensive a response to this reality?
“As a company, you can’t sell at a loss if you want to stay within a profit margin,” adds Mr. Rochette. The competition is fierce and everywhere.
“As soon as the products are cheaper elsewhere or on one site, it creates pressure on the seller. The latter must have an approach to being profitable, accessible as well as offering discounts. It is a daily battle for retailers.”
This announcement is part of an overall $80 million plan to reduce prices on 1,500 items in Canada.
“We see that nearly half of Canadian households are facing financial hardship and constant pressure to make ends meet,” CEO Selwyn Crittendon said in a press release.
A militant anti-tax
The retailer, which has stores in Boucherville, Montreal and Quebec, made headlines in late March when it launched a change.org petition calling for the tax on used clothing to be abolished.
“IKEA Canada is requesting a change so that Canadians do not have to pay tax twice on used goods,” it says.
“With inflation and the increase in the cost of living, we must end this excessive double taxation. […] This is why we want the federal and provincial governments to consider eliminating the used goods tax across Canada. And if they say yes, we will end TASM (GST and QST).”
So far, the company has collected more than 32,000 names out of a target of 35,000.
IKEA Canada in a nutshell
- $2.9 billion in sales (10.9% increase)
- 826 million dollars in online sales
- 28.6 million store visits
- 123 million dollars in food service sales
- Source: IKEA financial report 2022-2023
Price reductions in the antipodes
- KALLAX shelf (8 cubes): $109 to $99: $10 (10%)
- MALM Bed Frame: $399 to $349: $50 (13%)
- NYMÂNE Floor Lamp: $64.99 to $49.99: $15 (24%)
- Lidded Container HALLBAR: $17.99 to $14.99: $3 (17%)
- MILLBERGET Swivel Chair: $329 to $179: $150 (45%)
- Base Section: $933 to $921: $12 (2%)
1714007022
#Resale #sites #pressure #retailers #IKEA #prices #products
