Ikea is shutting down?
It’s no news that many brick-and-mortar stores are failing these days. Unless you’re shopping at an outlier like Target or Walmart, you’ll notice that stores aren’t nearly as crowded on any given day as they were even five years ago. Indeed, many experts expect that retail malls as we know them will be phased out in the near future.
Even the retail behemoth Kohl’s could go the way of the dodo bird. Ikea is now being forced to take a close look at its operations, according to CNN.
Thankfully, Ikea’s problems appear to be limited to China for the time being. The Swedish furniture maker has stated that the Ikea Store in Shanghai’s Yangpu neighbourhood will most likely close down. Ikea explained that a number of issues led them to the conclusion that the shop would most likely have to close.
First, since the outbreak of the pandemic, there has been a significant shift in how people purchase. Second, due to a number of cases spiking, Shanghai has been subjected to unusually rigorous Covid-19 lockdowns. The continuous lockdowns had a significant impact on sales at the Ikea in Yangpu. The Ikea store in Shanghai’s Yangpu neighbourhood will be the city’s second to close.
Ikea stated their reasoning in a statement published on WeChat. “Ikea China will introduce customer touchpoints in the Shanghai market to better fulfil consumers’ growing demand for online consumption and services, as well as the further preference for convenient delivery intensified during the epidemic,” said the statement.
Ikea did not make its likely decision to close the shop in Shanghai lightly, according to the statement. The decision was reached following “a detailed examination of Yangpu Store’s long-term feasibility,” according to the firm.
Surprisingly, Ikea isn’t the only major retailer that has begun to withdraw from the Chinese market as a result of declining sales. Due to restrictive travel restrictions and continuous lockdowns, Airbnb chose to terminate its operations in China.
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Even more intriguing is the fact that firms with a physical presence aren’t the only ones who are reshaping their relationships with Chinese customers. Nike has announced that its popular Run Club app will be discontinued. In addition, Amazon has stated that its Kindle store in China will be shut down permanently. Although, in Nike’s case, the shutdown of the Run Club app was only intended to be temporary. The fitness behemoth stated that it intends to restructure the app in order to better cater to the Chinese market.
Overall, Ikea’s store closures, as well as the general trend of retail closures in China, are indicative of a global shift in customer buying patterns. To be honest, people’s shopping habits have been shifting for quite some time. The epidemic, on the other hand, hastened the rate at which corporations have been forced to notice and respond to it.
It is highly possible that in-person shopping and the amount of brick-and-mortar establishments still thriving in their physicality will begin to look very different in the coming years. It’s simply the dynamics of the cause-and-effect principle.
