Ikea Philippines to open first store at SM Mall of Asia
Ikea Philippines will open its first store next to Mall of Asia in Manila in 2020.
Inter Ikea Systems announced in February it had appointed Ikea Southeast Asia (Ikano) as Philippine franchisee, the same company that holds the rights to Singapore, Thailand and Malaysia.
In an exclusive interview with Inside Retail Asia, Ikea Southeast Asia MD Christian Rojkjaer says Ikea chose to open its first Philippine store at SM’s Mall of Asia as it is such an impressive, established centre. “It’s already there and we have no chance to beat it.”
However, future stores might be integrated with Ikano’s own shopping-centre developments, similar to Bangkok’s Mega Bangna, Kuala Lumpur’s MyTown and the Toppen Tebrau under construction in Johor Bahru, Malaysia.
“What happens in Malaysia and the Philippines is that we go in and… we must create the best shopping destinations in that country either alone or with somebody else. So we do it shopping centre by shopping centre with the customer in mind. We are not like, ‘It has to be ours’. It has to be the best position for our customers. So let’s see what is going to happen [in the Philippines], but the first one will be with SM.”
Ikano is one of 10 Ikea franchisees worldwide and the only one owned by members of the founding Kamprad family. It had to pitch for the Philippines franchise, as it did for the Indonesian one (which it lost to Jardine Group’s Dairy Farm International in Hong Kong).
Southeast Asia is one of the few growth regions in the world for Ikea, where many local markets have developing economies so its customers have lower average incomes than in more developed markets.
“That has been quite challenging,” Rojkjaer tells Inside Retail Asia. “We want to be for the many in a country, but when we go into the Philippines, for a while it will be for a lot, but not for everybody. Then we will grow our presence and become more for the many, as we say. Of course, not everybody in the Philippines can afford us today, but we will work on that and adapt our range and become better and better to become something for many more people.
“That will certainly be the same in Vietnam, Myanmar, Laos and Cambodia, too. That said, our range will fit a lot of people in all those countries from day one.”
He says local businesses have no reason to fear Ikea’s arrival.
“What we have seen in Thailand is that the local competitors do better when we come, even though we compete with them. We do great and they also do great. Because the middle class is coming up in all these countries, there is a very big market for all of us to coexist.”
One such example is Thailand’s Index Living Mall, which has a presence in a growing number of markets across Southeast Asia.
“They were very nervous when we moved into Thailand, but actually, as far as I know, the Index Living Mall nearest us in Thailand [at Mega Bangna] is the outlet that does best for them. That is because the broader area has become a destination for home furnishing, and we all live well together even though they are hard competitors and very professional. They have a fantastic range as well.”