Ikea plans to locate more of its stores near cities in response to growing urban populations around the world, according to a report in The Wall Street Journal.

The Swedish retailer will also incorporate more of its stores into larger developments that also include hotels, homes and offices, the newspaper said.

“The recipe for success so far has been we build quite big stores out in the potato fields, whereas we see by 2050 [that] 70 percent of the world’s populations will live in cities,” CEO Peter Agnefjäll said in an interview with The Wall Street Journal. “And there are not so many potato fields in the center of London, so obviously we need to do something to keep Ikea accessible.”

Agnefjäll said that mixed-used developments, such as the one Ikea is investing in Copenhagen that includes a retail store, a hotel, and residential and office space, will enable it to purchase an expensive piece of land but maintain its low prices.

He also said that its stores will be the center of its operations going forward, serving as a place where customers can pick up online orders. At the same time, Agnefjäll said he expects the number of products that are sent directly to customers to grow significantly in the next few years, and is thus creating multifunctional distribution centers that can supply stores as well as ship items directly to customers.

(Source: hfndigital.com  Author: Allison Zisko)