STOCKHOLM, Dec.30 (Reuters) – IKEA, the world’s largest furniture brand, is raising prices by 9% on average amid rising costs of transportation and raw materials, the owner of most of the stores said on Thursday. its stores around the world.

IKEA previously said it was leasing more ships, buying containers and re-routing goods between warehouses to alleviate supply chain disruptions, but said it now needed to pass the costs on to customers because it expected the turmoil to continue.

Ingka Group said prices would increase by around 9% on average in its markets, with local variations reflecting different inflationary pressures, including raw material and supply chain issues.

Register now for FREE and unlimited access to Reuters.com

Register

“Unfortunately, for the first time since higher costs started to affect the global economy, we need to pass some of these increased costs on to our customers,” said Tolga Öncü, head of retail operations.

“IKEA continues to face significant transportation and raw material constraints that drive up costs, with no downtime for the foreseeable future,” the group said in a statement, adding that it expected the disruptions continue “until 2022”.

The Ingka group saw high demand during the pandemic as more and more people stayed at home.

It operates through a franchise system, with Ingka being the main franchisee of the Inter IKEA brand owner with 392 stores, including city stores, and 73 smaller store formats.

Register now for FREE and unlimited access to Reuters.com

Register

Reporting by Helena Soderpalm and Anna Ringstrom; Editing by Alison Williams

Our standards: Thomson Reuters Trust Principles.


Source link