Better Every Day Life - IKEA Serving Customers in China for 20 Years - Swedish ...
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Table of 09 21 Preface Contents Growing Together with Our Co-workers Sustainability Over 70 years ago, IKEA was founded in the rugged landscape of Småland in southern Sweden. Life there wasn’t always easy. To make ends meet, people had to be resourceful, work hard together and make a lot out of a little. The spirit of Småland impacts on every aspect of IKEA, encouraging us to continue to improve and go forward. In everything we do, we focus on achieving our vision: to create a better everyday life for the many people. Preface In 1998, China ceased the housing allocation practice and Milestone implemented housing monetization. The people of China began to truly own their real estate. The improvement of housing condition brought about changes in home concepts and demands. People IKEA in China wanted their homes to be more comfortable and beautiful, they wanted to have a better home lifestyle. 2017 Financial Year It was during this year that IKEA from Sweden opened its first store in Shanghai, which was the first store in mainland China, bringing Key Indicators - People & Planet Positive Chinese consumers a wide range of well-designed, functional - Culture and Values - More Sustainable Life at Home home furnishing products at affordable price. A variety of home - Energy and Resource Independence 01 - Career Development inspirations and solutions were also provided to create a better - Workplace and Benefits - A Better Life for the People and everyday life for the public. - Our Stories: IKEA Co-worker Communities Development Stories - Our Stories: Now 20 years later, IKEA is fortunate to witness and participate in - Comment Sharing Wise use of wood resources to the changes in the home lifestyle of the Chinese consumers, while Expert in Life at Home protect forests the Chinese consumers have also constantly inspired and influenced One-time investment, permanent benefit 15 Growing Together A memorable cafe makeover IKEA. With the rapid development of China’s economy and support from all sectors, IKEA’s business in China had grown rapidly and with Our Suppliers - Comment Sharing achieved fruitful results in terms of corporate employer branding and sustainability. 35 Transformation and Innovation 2018 marks the 20th anniversary for IKEA in China. Through this brochure, we look forward to recapturing our development in China and witnessing our growth together with consumers, employees and partners. We also look forward to IKEA’s exploration and experimentation in the face of changing customer needs and business environment. We continue to work hard to create a better everyday life for the many people. In these 20 years, we are filled with gratitude, we are Zhu Changlai Country Manager grateful to every single person we have met. We are also grateful for - Democratic Design IKEA Retail China - For the Many People a better tomorrow to look forward to! We look forward to an even - Provide Homes Inspirations, Create a - Customer-centric Multichannel Retailing more exciting coming 20 years for IKEA in China! Better Everyday Life - Strategic Partners - Creating a Meeting and Experience Center - Our Stories: Laohu and Diaodiao’s story - Look towards the Future - Comment Sharing - Our Stories: Yuyue Home Textile
2017 2017 2014 1.14 1.18 2007 2014 12.19 2008 9.17 Opening of the 2014 Wukesong PUP, the Opening of the IKEA Opening of the Beijing 4.16 Fengxian Distribution Milestone LIVAT Centre first Pick-up and 6.27 Center phase two, IKEA (China) Opening of the IKEA Wuhan Store First LIVAT Centre in Order point in China’s providing even better Opening of the IKEA North China first-tier city Investment Co., Ltd logistics service to 2008 First IKEA Store in 2015 Shenzhen Store Opening of the Wuxi Central China more stores was founded IKEA store located LIVAT Centre In the mid-1960s, IKEA began purchasing products from China. And in 1998, the first IKEA store in IKEA Distribution Service in Nanshan District’s “Europe Town” 8.28 China’s first LIVAT center mainland China was opened in Shanghai. Over the next 20 years, IKEA has grown rapidly in China 6.25 Asia Pacific and IT Opening of the IKEA department moved from with IKEA stores and LIVAT centres opening in more cities. More IKEA business units were also Singapore to Shanghai Nanjing Store The store once hosted established to create a better everyday life for the many people. a Swedish-style wedding 2008 2015 2017 Opening of the IKEA 12.1 4.30 Hangzhou Store, making 2014 IKEA accessible to 2006 Opening of IKEA Opening of the Wuhan 5.18 LIVAT Center consumer in Hangzhou 3.27 Distribution Centre 2016 Fengxian First LIVAT Centre in The only Low Flow Central China 8.28 Opening of the IKEA 11.29 2009 Distribution Centre in 1990 Asia Pacific Chongqing Store 1981 Opening of the IKEA Mid- IKEA has opened -1994 2.19 stores in all the municipalities in China IKEA start pilot operation of its online Nantong Store IKEA is entering third Opening of the IKEA 2009 sohp in Shanghai 1960s 2013 Opening of the IKEA tier city Direct Establishment of the Chengdu Gaoxin Store Dalian Store market. It’s a new start purchasing from Qingdao, Shanghai, and Shenzhen Trading Offices IKEA store opened in Sichuan, the first store The first IKEA store in Northeast China 1.1 11.7 for us. IKEA makes its China begins that offered local spicy Opening of the IKEA China Customer Support Opening of IKEA 2016 first purchase IKEA founder Ingvar 1997 snack Centre 400-800-2345, please Beijing Xihongmen Store, becoming a 8.25 from China Kamprad visited China IKEA wholesale call the IKEA China hot spot in Southern Opening of the IKEA for the first time company Bolso was established Contact Center! Beijing 2015 Foshan Store Known for being “trendy, in Shanghai 8.27 beautiful, smart” 1980 Opening of the IKEA Xi’an Store Establishment A press conference was 2016 1998 2006 2013 2017 of Hong Kong held on the ancient city Trading Office 8.28 wall of Xi’an 6.30 7.6 11.16 1.22 Opening of the IKEA Opening of the IKEA Opening of IKEA Suzhou Store Opening of the IKEA Industry Nantong Harbin Store Industry Dalian Factory We have more than who among all IKEA stores Factory, the Opening of the IKEA The manufacturer of IKEA POÄNG armchair manufacturer of IKEA 2015.11 20 IKEA stores now in China has the closest distance to Almhult, the 2010 BESTÅ frame and KALLAX shelving unit origin of IKEA Shanghai Xuhui Store All of IKEA’s suppliers 1.1 in China completed 1999 2002 The first IKEA store was 2012 Full IWAY (IKEA established in mainland 2011 business code of 1.13 Opening of the IKEA China 6.6 China Test Lab and conduct) IKEA Components Opening of the IKEA Beijing Training Center, the second IKEA self-owned 6.23 Opening of the IKEA Madian Store test lab and training Opening of the IKEA China was Wuxi Store centre in the world Shanghai Beicai Store The first store to be 2016 2006 established Beginning of multiple connected to the LIVAT 2005 stores in one city model Centre 4.8 2016 2003.4 10.12 2016 5.25 Opening of IKEA 4.12 Distribution Centre 3.24 IKEA Xuhui store moved Opening of the IKEA 2013 2013 Tianjin, the first IKEA Opening of the IKEA to its current 2005 Guangzhou Store 2012 7.17 Distribution Centre in Wenzhou Pick-up and 2011 Opening of the IKEA Northern China 2004 Known as the “IKEA 8.15 location Order Point 9.1 2017 Chengdu Chenghua 2.10 Furniture” store 2010 China’s first Pick-up IKEA Beijing Store moved Opening of the IKEA Store and Order Point Establishment of to its current location at 8.21 Ningbo Store Opening of the IKEA IKEA now has two 5.20 Opening of the first the IKEA Product is now accessible Siyuan Bridge; one of the Opening of the IKEA IKEA has opened Shanghai Baoshan Store stores in Chengdu The IWAY team IKEA Distribution Development Tianjin Store to consumers in stores in Jiangsu, The store has a was established in Centre in China, IKEA IKEA stores with the Centre Asia The 10th store Wenzhou Opening of the IKEA Opening of the IKEA Zhejiang and beautiful coffee shop at Distribution Centre highest volumes globally Pacific Jinan Store China, responsible Shenyang Store marks our store Shanghai! the self-serve area Songjiang Shandong here we for the audit of The largest IKEA store number reaches double-digit! come! suppliers in Northeast China 5 6 7 8
2017 Financial Year Key Indicators* IKEA in China Under the IKEA brand, IKEA Group and the Inter IKEA Group operate different business units in IKEA Group Inter IKEA Group China and each perform their respective duties, all for the common vision of creating a better everyday life for the many people. More than More than 24 11,000 2,100 IKEA Group Store Sales: Store Visitor: IKEA China Holding Inter IKEA Group 14.3 97.6 IKEA Centres China IKEA Product Development IKEA Regional Supply Team billion RMB million IKEA Retail China Centre Asia Pacific Asia Pacific IKEA Distribution Service Asia IKEA Free Range Center IKEA Transport and Logistics 293 Pacific East Asia Services Asia Pacific IKEA Indirect Material and Services IKEA Supply China IKEA Industry Dalian Factory IKEA Shared Service Center (SSC) IKEA Purchasing & Logistics IKEA Industry Nantong Factory Number of Shopping Number of East Asia LIVAT Co-worker IKEA China Test Lab and Co-worker Center IKEA China Business Solutions IKEA Components China Training Center Centre IKEA China Customer Support IKEA Distribution Network IKEA Shanghai Learning Tenant Sales: Visitor: Centre IKEA Shanghai Xuhui Store, IKEA Design Center 8 59 billion RMB million Guangzhou Store, IKEA Beijing Siyuanqiao Store, IKEA Chengdu Gaoxin Store, IKEA Shenzhen Store, IKEA Nanjing Store, IKEA Dalian Store, 3 IKEA Shenyang Store, IKEA Shanghai Beicai Store, IKEA Tianjin Store, 2 IKEA Wuxi Store, IKEA Ningbo Store, IKEA Shanghai Baoshan Store, IKEA Beijing Xihongmen Store, IKEA Chongqing Store, IKEA Wuhan Store, IKEA Social Media IKEA Hangzhou Store, IKEA Xi’an Store, IKEA Chengdu Chenghua Store, IKEA Wenzhou Pick-up and Order Point, IKEA Suzhou Store, IKEA Foshan FAMILY Platform Store, IKEA Wukesong Pick-up and Order Point, IKEA Nantong Store, Members: Follower **: IKEA Harbin Store, IKEA Jinan Store Pick-up LIVAT 19 9.4 Number Global IKEA Wuxi LIVAT Centre, IKEA Beijing LIVAT Centre, IKEA Wuhan LIVAT Store and Order million of Product Purchasing Centre Point Centre million Value Share: *2 017 financial year runs from September 1, Suppliers 27% 2016 to August 31, 2017 ** S ocial media platforms include IKEA Weibo account, IKEA WeChat Subscription Account, and IKEA FAMILY WeChat Service Account 9 10 11 12
Expert in Life at Home Expert in Life at Home In 1943, Ingvar Kamprad from Sweden founded IKEA, with the vision “to create a better everyday life for the many people”. The business idea of IKEA is to offer a wide range of well-designed, functional home furnishing products at prices so low that as many people as possible will be able to afford them. IKEA offers unique home products, inspirations, and solutions to meet the home furnishing needs and dreams for the many people. 1 2
Expert in Life at Home Expert in Life at Home Democratic Design For the Many People Philosophy IKEA’s business idea can be seen throughout We feel that good design combines form, the design, purchasing, packaging, function, quality, sustainability at a low distribution, retail and other links. By price. We call it “Democratic Design” improving product design, optimizing because we believe good home furnishing production processes and materials, IKEA product is for everyone. is committed to creating lower product prices and helping more people to afford our Everything that IKEA does begins with products. understanding people’s life at home. Every year, we visit homes all around the world to find out people’s needs and dreams for life at home. We then pair their needs with the abilities of our suppliers to create new solutions that will make everyday life a little IKEA product price comparison 20 years ago better for the people. vs. today For example, the development of the IKEA Product Prices from Current Product MÅLA felt-tip pen. We have taken into 20 Years Ago Retail Price consideration factors such as when using KLIPPAN KLIPPAN the felt-tip pen, children might place the ¥2,999 ¥999 sofa sofa pen in their mouth, they may strike the pen hard against the board, and they might like ANEBODA ANEBODA to draw anyplace anytime. Therefore we ¥1,495 ¥549 wardrobe wardrobe have chosen non-toxic and more durable materials, with easy-to-clean dyes. IKEA BILLY BILLY ¥898 ¥399 held full communication with its suppliers bookcase bookshelves during the design phase and conducted a large amount of customer research, HELMER ¥898 HELMER ¥199 culminating in the revision of several chest of drawers chest of drawers versions before finally achieving this little LACK LACK felt-tip pen. ¥299 ¥39 side table side table In 2011, IKEA set up the IKEA Product HATTEN HATTEN Development Center Asia Pacific to better ¥295 ¥99 side table side table understand the home furnishing needs of consumers in China and in other countries FROSTA FROSTA of the Asia Pacific region. IKEA Product ¥125 ¥49 chair chair Development Center works with local suppliers to develop home furnishing products that meet their needs. Provide Home Furnishing Inspirations, Create a Better Everyday Life IKEA shares life at home research findings, knowledge, inspiration and solutions through various channels including the IKEA stores, websites, “IKEA Catalogue”, mobile apps, social media platforms, and offline activities, in order to raise public awareness and interest in life at home and to help the public create a better everyday life. 3 4
Expert in Life at Home Expert in Life at Home Diaodiao and Laohu’s Home In addition to looking for secondhand goods and doing handcraft, they also look after 2 Laohu and Diaodiao is a young couple born cats, 1 dog, and 2 tortoises. They have a in the 1980s, they come from Shijiazhuang very fulfilling life at home. “The best thing and Dalian respectively. Due to their after work is to go home, after all, home is fondness of IKEA, the two of them joined so wonderful so we never really want to go IKEA as designers four years ago. They out,” said Diaodiao. rented an 80 m2 apartment in Shanghai and through creativity and ingenuity, they have The couple enjoys doing continuous transformed the nondescript apartment into improvement for their home. They have an art and culture inspired “secondhand painted one wall of the living room a new treasure shop”. color and changed the original sofa to a two-person love seat with cushions. They Their home is filled with secondhand items have also placed various ornaments and they have found in local and overseas hanging decorations to serve as room decor. secondhand shops, as well as gifts from These small changes have filled their home friends. Each object has its own story and with personality and distinct atmosphere. they bear the marks of time and emotions. The couple has carefully created a unique “We don’t have a reason for liking IKEA, we storage and display space for these objects. just do, but there is no doubt that IKEA has “If we buy an item, we will find a place for it made us love our home even more. It has as we see fit,” said them. given us endless inspiration for our passion for life, our perfectionist nature, and our When the couple has free time, they also energy to mix and match. If there were no enjoy doing handcrafts, so their home space IKEA, our home will probably not be like this layout has also been planned according to now,” said Laohu and Diaodiao. their hobbies, each has their own space to do their own things and fully enjoy the pleasures of handcraft. * This article is adapted from the WeChat article “Two People, Two Cats, One Dog | 80m2 Rental Apartment ’Secondhand Treasure Shop’” on IKEA FAMILY WeChat Service Account. 5 6
Expert in Life at Home “The first IKEA product I bought was the “The BILLY bookcase was the first piece “From 2007 to now, IKEA has undergone Han Ying Yu Qing RÅSKOG utility cart. Back then I was of IKEA furniture we bought when we changes, when I flip through the ‘IKEA IKEA FAMILY IKEA FAMILY pregnant and had just moved to a new city, bought our first house - oh, I should say Catalogue’ from the last decade, I really felt 10-Year FAMILY 10-Year FAMILY this was the first piece of furniture I bought it was actually the first to fourth piece of a sense of pride as if my child has finally Member Member for my rental apartment. My husband was in furniture, because I bought an entire wall grown up. I don’t know if IKEA has followed another city, so I slowly assembled the cart of bookcases in one go. Before our bed the aesthetics of the era, or if it had instead on my own. Piece by piece I assembled our was even properly set up, our collection of created the sense of home aesthetics for future life, I was full of anticipation for our more than 600 beloved books already had a the eras. Or perhaps we ourselves and IKEA little nest. This utility cart was placed in the home. Imperceptibly, the BILLY bookcases have created each other together. What I “The day I met you, it was drizzling in “IKEA, the first time I met you, I was 18 kitchen, at first, it held the grains and fruits has accompanied us for 5 years. Now I visit saw in the IKEA Catalogues was not only Beijing, I was waiting at Madian for the bus years old. Throughout the years, I have I ate during my pregnancy, now it is full of IKEA at least once a month, in less than IKEA’s history of evolution, it was probably to go home. I passed by you and discovered been influenced by you imperceptibly. Home the food material for my baby. When she three years, my small home has been filled also an evolution of our understanding of you, this was the first time that you gave life did not simply mean the wallpaper on is older, we will move into our own home. I with traces of IKEA, from the bathroom, home life.” a junior high school student a shopping the wall and the sofa in the living room, you will use the utility cart as a movable rack for kitchen, bedroom, study, to the living room. environment that was as warm as home. provided us with so many impressions of stationery. I like the IKEA philosophy. Thank Small items include ornaments, light bulbs, Song Bing I fell in love with you when I became a a comfortable home. It could be that lamp you IKEA for bringing more possibilities for power adapters, flower pots, plants, hooks, Founder of Pineapple Zebra Home Living wife, I filled an IKEA’s glass bottle with on the desk, or the delicate fruit platter my home!” and table napkin; large items include racks, Guide multicolored sand, where you served as a on the coffee table, you gave even more shoe cabinet, and chest of drawers, IKEA witness to my love. I followed you when I meaning to warmth for home. With you Qin Zhi has integrated itself in our life.” was lucky enough to go on a trip to explore accompanying me these past ten years Sweden, I learned about the origin, history or so, my home has been filled with more Sesame Apple and culture of IKEA. Once again, I saw with and more small items both exquisite and my own eyes your unwavering dedication functional. There is no more need for me to and caring designs. From a shy student visit furniture markets, my wallet also no “It has already been 13 years since I joined to an experienced mother, the price of longer needs to starve to make ends meet. IKEA Retail. My little home is just over 100 the 1 RMB IKEA ice cream has remained With all the different storage solutions, I square meters, from the couple’s love nest unchanged, what has changed is that I’ve have become an expert in life at home! It’s in the beginning, now three generations learned to use home products to make my wonderful to have you in my life, thank you share the same roof, it has continued to lifestyle even more exciting. I will follow IKEA!” change along with the changes in my life. you all the way, just like this... forever and The greatest need at my home is storage ever!” space, the large amount of items owned by our current family of six need to be stored according to their categories. Storage is actually an art, apart from independent storage room, I have also spent quite a bit of time working out the spaces according to Hu Yang Sun Yan Cui Yueqiang functions based on the different activities IKEA FAMILY IKEA FAMILY IKEA FAMILY and needs of the elderly and the children. 10-Year FAMILY 10-Year FAMILY 10-Year FAMILY I have removed the originally less utilized Member Member Member space and turned it into a multipurpose space which the family can enjoy together. There isn’t a ‘best’ home, only the more suitable one! Throughout these years, I understand the IKEA vision of ‘to create a “In these twenty years, from being “Twenty years ago, I wrote down some “Twenty years ago, you came to China to better everyday life for the many people’ inexperienced to becoming mature, from words: ‘Plan the travel itinerary, get a serve consumers here. Sixteen years ago on more and more and how it is intimately tied being carefree and worry-free to learning new cushion, get a new painting, do some a bright day after the rain, you and I met. to the people’s lifestyle, it truly touches how to bury pain deep within my heart. baking, make a cup of hot tea on rainy The natural, warm, elegant, and passionate our hearts and make dreams come true. At the celebration banquet, you kept me nights. Happiness is based on your own you made me see a hundred different types The people includes me and you, a better company quietly, reminding me not to forget perception, there are actually many sources of the perfect life, my life became more everyday life starts from you.” to spend time with my family and care for to happiness.’ Today, I have accomplished beautiful because of you. I want to smile myself while I strive for accomplishments. everything on the list, in each, the shadow with you, I want to play with you, I want to Anita Huang On a sorrowful rainy night, you kept me of IKEA can be seen. From buying home hold you tight in my arms, I want to grow Communication and company quietly and comforted me, the furnishing products to spending time at old with you peacefully as time passes, Interior Design Manager warm candle light understood the pain the IKEA restaurant when I have some having met you, I met a better me. ‘Daddy, IKEA Beicai Store in my heart. Perhaps it was only a cup, a free time, with the passage of time, it Daddy, I want to go to IKEA!’” lamp, a pillow, or a blanket, but they used has become a habit. Now if there are no their own particular warmth to tell me: plans for the weekend, I will ask my son: ‘Don’t be afraid, I am still here, keeping you ‘Where should we go?’ My son always company...’ Thank you IKEA! In the past replies: ‘Let’s go to IKEA Store!’ The change twenty years, you have brought warmth to has happened a long time ago and it will the countless hearts in this city.” continue to move forward.” 7 8
Growing Together with Our Co-workers Growing Together with Our Co-workers At IKEA, we believe in every single co-worker. Everyday, each of our co-workers brings their unique ideas and talent to work – they are what makes IKEA great. We advocate a diverse and inclusive work environment. Everyone’s voice and ideas deserve to be heard, and their potential can be explored at work. We believe that as our co-workers grow, IKEA grows too. 9 10
Growing Together with Our Co-workers Growing Together with Our Co-workers Career Development At IKEA, we provide our co-workers with the space to fully develop their talents. Culture and Values In this diverse atmosphere, we are happy to discover and embrace the strengths of IKEA co-workers are a diverse group of every single person. We have a distinctive down-to-earth, straightforward people with perspective on talent and a unique career a passion for life at home. Everyone comes plan. We believe that the co-workers take from different places and has different lead in their own development, they can backgrounds, but all share the common design their own career paths according to vision of creating a better everyday life for their own development planning and future the many people. goals. In this environment, employees can grow to be the best version of themselves. The culture and values of IKEA is found in We believe that as our co-workers grow, every aspect of our business, it also forms a IKEA grows too. part of IKEA’s foundation of inclusive, open and honest culture. It’s all based on a spirit Workplace & Benefits of togetherness and enthusiasm. We work hard and enjoy doing it. At IKEA, we together aim to create a diverse and inclusive work environment, we respect each other and our differences. Here, co-workers can always be themselves. At the same time, IKEA also provides co-workers with performance-related bonuses, pension benefits, and learning and development opportunities. Over the years, IKEA has been awarded the titles of Best Employer and Model Business by external agencies. 11 12
Growing Together with Our Co-workers Growing Together with Our Co-workers A Fast Track for Leadership Climbing Upwards in Pursuit 10 Years, from IKEA Fan to Sweden - China - Sweden- The Lucky Du Lala Exempt of Dreams IKEA co-worker, from the Singapore - Italy, from Office Politics I’ve learned to know and embrace myself through my training and practice in IKEA. Back to the Frontline A Smooth and Inspiring I began to work in IKEA right after From an intern to the HR manager, I’m the Introspection and self-knowledge make me graduating from high school. From the Journey living proof of Du Lala. Yet in my story, all I a better leader. At 30, I became the first In 2008, as a fan of IKEA, I joined the IKEA forklift driver to warehouse manager, then Fengxian distribution center as a planner. have are support after I’ve made mistakes, female store manager in China. Now I am to overseas purchasing, I’ve come a long Thirteen years ago, I moved from Sweden and sharing from co-workers at times of the Country Manager of IKEA Retail China. In 2012, due to my personal interest and to China and joined IKEA Purchasing. way. BESTÅ cabinet is my favorite IKEA business needs, I joined the operations bewilderment. Such growth is both pleasant I’m facing new challenges and opportunities product and only it can store all of my good After that, I followed the development and motivating, which I will definitely pass every day. Every improvement of leadership department and became a team leader of of the supply chain and joined the IKEA memories here. front line operation function. In these 6 forward. gives me a great sense of achievement. Distribution Service Asia Pacific. Five years, my team and I have grown together, years ago, I was transferred to IKEA of Ma Fengqiang Process Development, there were conflicts, challenges, and Huo Jing Zhu Changlai Country Manager, IKEA Components Sweden, getting to know the whole process HR Manager IKEA Retail China tears, but there was more joy, touching of product design and development, memoments and sense of accomplishment. IKEA Baoshan Store manufacturing and distribution in Småland. During these 10 years, I witnessed the After that, I embarked on new adventure I Want to be a Store Manager development of IKEA retail and logistics, with IKEA stores in Singapore and Italy to Passion Follows me in every IKEA also witnessed my development and in the Future experience the passion of IKEA Retail. New Position for 35 Years improvement at work and in life. I am proud roles always bring about new experiences. As someone born in the 1990s, when I of IKEA, I am even more proud that I am a In retrospect, it has always been an Over the past 35 years in IKEA, I’ve been joined IKEA three years ago, I had no part of IKEA. inspiring journey. a designer, a sales person and a manager. background in home furnishing retail Everyday, I’m learning, growing, being industry. Now three years later, I have Liu Di Li Jing Store Manager, challenged and practicing. Now sitting on become a professional kitchen and dining Team Leader, Operation IKEA Italy Catania Store the cusp of middle age, I’m still passionate room furniture shopkeeper who leads IKEA Fengxian Distribution Center about what I do. a team to help clients meet their home furnishing needs and dreams. IKEA has Hu Yucai Store Manager, IKEA Xuhui Store helped me to feel more passionate about From a Rookie to Master of life and believe even more that in the future Space Transformation in 20 I will have unlimited possibilities. It not only gives me an income, but also has created Years “In 2007, I participated my first Store Front “In 2012, I participated in the IKEA better future opportunities for me, for Week at IKEA Siyuanqiao Store in Beijing, Backpack Training Program. It was the first others, and for the world. My goal is to join Innovation is deeply ingrained in IKEA’s DNA. I’ve never enjoyed “changing” so working together with store co-workers. time in my life that I had left Shanghai the store management group within a year much even after 20 years in IKEA. It gives Working in the field of Purchasing in IKEA, I and lived abroad, over the next 2 years and become a store manager within five years. I will work hard to achieve this goal! me a great sense of satisfaction to be able felt deeply the enthusiasm of customers and I experienced working in various IKEA to accurately perceive the size, the space their love of IKEA products. This experience business units around the world. Tan Xiaofei Shopkeeper, and organize the working area. I will spare has made a deep impression on me. It I never felt lonely overseas because all the IKEA Baoshan Store no effort to transform the space with IKEA has enabled me to dedicate myself to the IKEA co-workers around the globe offer the solutions whenever there is a need. improvement and upgrade of IKEA products same kind of warmth and care.” Hu Huijing IKEA Business Manager, for the next ten years, in order to create a A Walking Catalogue in 7 IKEA Beicai Store better everyday life for the many people!” Yang Fan Years IKEA Retail China Service Office Sandra Xiu I’m the walking and talking IKEA catalogue. After 7 years in the organic chemical testing IKEA Purchasing & Logistics East Asia department, I’ve learned everything from “In December 2016, I supported the structure to performance of every product. first recruitment fair after joining IKEA. I’ve never felt bored after 7 years in the “In October 2013, I joined the IKEA I worked hard with my co-workers in same position. There is always something Customer Support Center, from then on I the Communication and Interior Design interesting waiting to be explored. have viewed this business that focuses on function to set up the venue, assemble our Wu Bing Test Leader of Organic Chemical home as my own ‘home’. In this ‘family’, we own furniture in person, and adjust the Lab, IKEA China Test Lab and Training see each other as ‘family members’, we help seat position. It was because we cherish Centre and support each other.” every future partner, we cherish our first appearance in front of them! Welcome to Xining Zhao IKEA! We are always on the way!” IKEA Customer Support Center Mika Wang IKEA Nantong Store 13 14
Growing Together with Our Suppliers Growing Together with Our Suppliers Suppliers are IKEA’s important strategic partners. IKEA would like to share its values and business models with its suppliers and grow together with its suppliers. Through the cooperation, IKEA will acquire more optimized solutions and inspiration, to save customers time and money. And suppliers will also be better informed about life at home and customer needs, access new technologies, and develop their own business. 15 16
Growing Together with Our Suppliers Growing Together with Our Suppliers Strategic Partners and IKEA. For the 2017 financial year, the products or production. Furthermore, Look towards the Future China accounts for 27% of total IKEA global IKEA has established a communication and Since entering China in 1990 to today, over purchasing share. exchange platform for suppliers to promote Since entering China, IKEA has always 28 years have passed for IKEA Purchasing communication between suppliers, as well cooperated with the Chinese government and Logistics and it has achieved impressive In the process of cooperation with suppliers, as between suppliers and universities, and actively supported the national results. IKEA is currently a strategic partner IKEA helps suppliers to learn about life colleges, research institutes and trade development strategies, contributing to with more than 290 suppliers in China and at home and customer needs, engage associations. China’s economic and social development. its entire industry chain provides nearly one them in the reference of new technologies million jobs in China, with an average of 11 and industries, and help to provide In 2015, the Chinese government years of cooperation between each supplier suppliers with innovative solutions for announced the “Made in China 2025” plan. IKEA has responded positively and formulated a series of action plans according to its own circumstances for green manufacturing, renewable resources, and technology and industrial upgrading. IKEA will encourage its suppliers to move from traditional manufacturing to high-quality manufacturing, and ultimately to smart manufacturing, for the implementation of innovation and transformation. Through its own capabilities and planning, IKEA will make its own contribution to the transformation of “Made in China - Quality in China - Intelligent Manufacturing in China”. 17 18
Growing Together with Our Suppliers Growing Together with Our Suppliers communication with Yuyue’s management level, confirmed projects and topics, shared relevant case studies and tools to middle and senior management level, including IKEA’s sophisticated internal management model, as well as the introduction and use of new tools. Through the training and cooperation between the two parties, it took only about a year or so for the standard of Yuyue to be greatly enhanced. Yuyue has now become a model of IKEA global suppliers, IKEA also organizes for similar suppliers around the world to visit and learn from Yuyue, and participate in exchange with regards to each other’s development direction. Quite a number of suppliers have commented jokingly: “The relationship between them is no longer ’rival’, but actually ’teammate’.” Yuyue Home Textile: from a Common Manufacturer to IKEA Global Supplier Yuyue Home Textile Co., Ltd. (hereafter referred to as “Yuyue”) located in Binzhou, Shandong Province, is a classical example of suppliers that has thrived through cooperation with IKEA. This is only a business with a dozen of years of history, but it has grown from an ordinary production-oriented company and developed into a modernized textile enterprise that owns the complete industry chain including the R&D and design of popular textiles, the purchase and processing of cotton, spinning, weaving, dyeing and finishing, sewing of products, brand sales, as well as self-operated import and export trade. Every year, it provides green home textile products to billions of consumers in Europe, the Americas, Africa and Asia. At the beginning of the partnership between the two parties, in light of Yuyue’s weakness in business operation and development, IKEA utilized its own resources to organize leadership workshops and conducted various projects to enhance the capabilities of Yuyue’s corporate personnel. In the early years, IKEA has engaged itself with full 19 20
Sustainability Sustainability At IKEA, we hope to have a positive impact on mankind and the planet. Sustainability means starting out with long-term interests, protecting the environment, cherishing resources, and ensuring positive development. With IKEA’s sustainability strategy “People & Planet Positive”, we have integrated sustainability into all aspects of our business and strive to work with all parties to create a more sustainable future. 21 22
Sustainability Sustainability More Sustainable Life at Home IKEA provides affordable, well-designed and functional sustainable products and People & Planet Positive solutions to inspire Chinese consumers to save energy and water, reduce waste and adopt healthy lifestyles, enabling them to live a more sustainable life at home and IKEA Sustainability Strategy “People & Planet Positive” Change Drivers: reduce their impact on the environment. 1. Inspire and enable customers to live a more sustainable life. More Sustainable Life at 2. Strive for resource and energy independence. Home Products 3. Take a lead in creating a better life for the people and communities impacted by our business. IKEA offers over 400 sustainable products and solutions in China that cover every Sustainable Development Goals aspect of the consumer’s lifestyle, to help them to live a more sustainable life at home. For example, hanging flower pots The UN Sustainable Development Goals (SDG) released in December 2015 has laid out the business strategic direction for IKEA, and flower stands for the balcony, textiles to help us build a sustainable future. for the bedroom, height-adjustable desks for the office, faucets for the kitchen, lighting, waste sorting bins, containers for IKEA supports these goals, at the same time, through our own efforts, we promote the realization of these goals which will have food storage, bicycles and recycled shopping a positive impact on mankind and the earth. bags for travel. RYET LED bulb consumes 85% less energy than incandescent bulbs and has a life span United Nations Sustainable Development Goals of up to 20 years. Compared with glass or ceramic stove tops, No poverty Zero hunger Outstanding High quality Gender equality Clean water TILLREDA portable induction hob has a 60% health and education and sanitation faster heating speed, saving up to 40% welfare facilities energy. IKEA kitchen and bathroom faucets save more than 30% of water compared with normal faucets. Inspiring a More Sustainable Life at Home Economically Good quality Industry, Reduce Sustainable Responsible viable clean work and innovation and inequality cities and consumption Starting from 2014, IKEA has been involved energy economic growth infrastructure communities and production in the Sustainable Consumption Week co-organized by several environmental organizations for three consecutive years, inspiring and guiding consumers to enjoy a more sustainable and healthier life. In addition, IKEA has also set up sustainable living show rooms at stores to inspire consumers to live more sustainably. IKEA Climate Underwater Terrestrial Peace, justice Partnerships also actively cooperates with external initiatives animals animals and strong that promote the agencies to promote and popularize the achievement of institutions goals concept of sustainability to more people. 23 24
Sustainability Sustainability Energy and Resource Independence Responsible sourcing Other raw materials Raw materials, such as leather, down and Green buildings IKEA wishes to operate the IKEA buildings Wood feathers and palm oil used in IKEA products as efficiently as possible in order to reduce We are against illegal logging and promote come from more sustainable sources. Foods carbon emission. At present, IKEA Jinan IKEA always strives to make more from Product design Being made from sugarcanes, the bioplastic responsible timber trade. In 2002, IKEA on sale at IKEA, such as coffee and seafood Store is the first store to be rated Excellent less. We’re also busy turning waste into The TOMAT spray bottle contains 10% raw in ISTAD plastic bag is both renewable and started working with World Wildlife Fund products, are also certified. by BREEAM*. In the future, all new IKEA resources, sourcing food and materials in materials made from packaging waste recyclable. (WWF) to support sustainable forest stores and LIVAT Centres to be opened in a responsible way and protecting natural gathered from IKEA stores. management to ensure the wood and paper More sustainable operations China will be certified green buildings. resources. And because we want to become Customer support energy independent, we’re making the The ODGER chair is made of wood plastic Recycling and reuse are both the end of we source came from more sustainable sources. IKEA is always looking for ways to reduce Product transport switch to renewable energy. composite, and contains 30% renewable a cycle and the beginning of a new cycle. energy consumption in its own business IKEA tries to make product transport more wood and at least 55% recycled plastic. IKEA offers a mattress take-back service in Cotton activities in order to ensure a more efficient in order to reduce costs, travel Circular IKEA China, and has introduced a sofa take-back Starting on September 1, 2015, all of the sustainable operation. time and the impact on the environment as The KUNGSBACKA kitchen door is the first service in FY18. We will continue to explore cotton used in IKEA products comes from much as possible. In 2016, IKEA Transport IKEA wants to have a positive impact kitchen door in the IKEA range made from take-back services for other products. more sustainable sources. This means that Renewable energy China was named a “China Green Shipper” on people and the planet. Therefore, we both recycled wood and recycled plastic. the cotton is either recycled, or grown with Urgent action is needed to tackle climate by China Road Transportation Association have introduced the concept of “Circular The front is made of recycled wood and less water, chemical fertilizer and pesticide, change. This is why the IKEA Group is in recognition of its contribution to and IKEA”, where resources can be used more covered with plastic foil derived from while increasing profit margins for farmers. committed to producing as much renewable progress in green transportation. efficiently through recycling. We intend to recycled PET bottles. As a result, we can produce more sustainably and be better at Along with WWF and others, we helped set energy as it consumes in its operations implement Circular IKEA in areas including up the Better Cotton Initiative (BCI), which using the earth’s resources wisely. by 2020. In FY16, IKEA Industry Nantong product design, production and transport, aims to make global cotton production Factory generated 3.5 million kWh of and customer support. better for the people who produce it, electricity on photovoltaic solar panels, better for the environment it grows in and thereby reducing carbon emission by 3,600 better for the sector’s future by developing tons. 11 IKEA stores generate a total of 3 Better Cotton as a sustainable mainstream million kWh a year on photovoltaic solar *B REEAM is short for Building Research commodity. Establishment Environmental Assessment Method. panels, thereby reducing carbon emission It is the most widely used green building by 3,000 tons. assessment method in the world. 25 26
Sustainability Sustainability A Better Life for the People and Communities Supporting IKEA Foundation Children should have the right to grow up We want to create a better life for the Every year, the IWAY team performs a full support more suppliers to join the project in secure households with stable income people and communities impacted by our assessment of every supplier. Meanwhile, each year so as to bring more children and enjoy health and quality education. business, which include our co-workers, we work with our suppliers in developing together with their parents. IKEA Foundation creates substantial and suppliers, and children and families living projects to keep improving the quality lasting change by funding holistic, long- in some of the world’s most vulnerable and capability of IWAY management. term programmes in some of the world’s A positive impact on the poorest communities that address children’s communities. IKEA also supports suppliers who conduct training and assessments of their main community fundamental needs. Better lives for workers downstream suppliers in order to ensure the sub-suppliers comply with IWAY MUST. IKEA stores and business units work hard As part of the IKEA Good Cause campaign, in our supply chain Furthermore, in addition to home furnishing to provide support for the community. We IKEA Foundation through its partners supplier assessments, we perform work with organizations, customers and supports children’s educational projects in In 2000, the IKEA business code of conduct, assessments on components suppliers, co-workers in creating a positive impact on some of the world’s poorest communities IWAY was launched. IWAY is a pre-condition transport suppliers and other IKEA suppliers the community. and refugee support projects. For years, for suppliers who wish to do business with in order to ensure that all suppliers provide IKEA stores in China have been playing an IKEA. It sets the minimum requirements working conditions in compliance with the In 2016, IKEA launched the I Care project, active role in supporting the IKEA Good for suppliers while working with IKEA, environmental and social requirements. where we worked with different parties to Cause campaign. and covers environment and social and open I Centers at community in places with working conditions. IWAY ensures that In 2016, IKEA launched the I Care project, a large number of migrant children. These 2003-2015 suppliers comply with laws and regulations where we worked with IKEA suppliers to centers provides a safe place for children to “Soft Toys for Education” in working conditions, social responsibilities, provide family dormitories for migrant learn and play after school and help them IKEA Foundation donated €88 million to environmental conservation and employee workers and help their children enter local grow up happily and integrated into the Save the Children and UNICEF during the benefits. A complete social responsibility schools. An after school activity center society. IKEA so far has opened I Centers in Soft Toys for Education campaign. The management system and a corresponding was created under the project. The project local communities in Shanghai, Tianjin and donations were used to support education set of guidelines will contribute to business makes it easier for migrant workers to bring Chengdu. We will continue to build more I for children projects. In particular, €7.7 stability and growth for suppliers. their children to live with them, thereby Centers in communities across more cities million were spent on supporting education keeping families together. The IKEA project in the future so more children can benefit for children projects in China. In 2004, IKEA created a full-time IWAY so far has helped more than a hundred from the project. team to handle supplier assessments. migrant families come together. IKEA will 2014-2015 “Brighter Lives For Refugees” The Brighter Lives for Refugees campaign generated €30.8 million in donations from IKEA Foundation to UNHCR, the UN refugee agency, to provide light, renewable energy and education for refugee families living in camps in Asia, Africa and the Middle East. 2016-2017 “Let’s play for change” IKEA Foundation has committed to donate €45 million to its partners to support children’s play and development projects. 27 28
Sustainability One-time investment, chance at receiving a good education and IKEA provided renovation and other is the most effective way of eliminating the technical support as well as home furnishing permanent benefit safety issue involved in leaving children for the dormitories and the child center. unsupervised by parents. The practice is “This is a one time investment with lasting There are many migrant workers in the essentially an extension of IWAY. benefits,” said an MYS representative. factories run by IKEA suppliers. To find work, they had to leave their children to the With IKEA’s strong support, MYS, an At present, IKEA tries to have more care of other family members and endure IKEA supplier in Dongguan, Guangdong, suppliers participate in the I Care project so extended separation from their loved ones. started providing family dormitories with as to bring more families together. IKEA takes the view that working with independent units for migrant workers suppliers to bring families together will, working in its factory and after-school from a business point of view, lead to lower center where the workers’ children could employee turnover and better performance learn and play. With this, workers no for the suppliers. Meanwhile, from a social longer need to worry about their children’s point of view, it gives children a better whereabouts after school. Wise use of wood resources missions of the IKEA and WWF partnership certification in the country, 85% of which to support sustainable wood production had benefited from the partnership between to protect forests and trade. In 2008, WWF and IKEA teamed IKEA and WWF. At present, projects up and released the handbook, Keep It supported by the partnership are going China plays a key role in the global forest Legal, to provide an important guide to strong in northern and southern China. products market not only as a major preventing products of illegal logging from In 2016 and 2017, the partnership has manufacturer, but also as a large consumer. entering the supply chain of forest products. supported 9 companies in 8 provinces. Such The World Wildlife Fund (WWF) and IKEA The partners also supported and hosted a collaboration helped IKEA achieve the goal share the same goal in China, which is to number of successful seminars and other of having its wood products in China use promote responsible forest management events, contributing to responsible wood materials 100% from sustainable sources. and create a healthy ecosystem. trade among Chinese business including IKEA suppliers. In December 2017, IKEA was given a WWF IKEA and WWF have formed a partnership Forest Partner Award at the WWF Annual in China to combat illegal logging and The project supported and initiated a Conference, Green Dialogue, where WWF support sustainable forest management series of campaigns and promotional offered recognition and appreciation to IKEA certification in order to facilitate responsible activities aimed to raise awareness of forest for being a long term strategic partner and wood trade, identify and protect forests that management and illegal logging. In 2015, actively contributing to WWF sustainable are particularly important, and promote as part of the Sustainable Consumption forest management as a long term strategic responsible forest management. In 2002, Week, WWF teamed up with 17 IKEA partner. IKEA and WWF started identifying high stores to raise awareness of sustainable conservation value forests in the Northeast forests and encourage consumers to buy IKEA and WWF will continue to promote China and Inner Mongolia. The partnership certified sustainable wood products. The responsible forest management and protect also supports development of sustainable campaign reached hundreds of thousands of precious forest resources and what they forest management certification in the households. stand for. region. In 2013, more than 3 million hectares of Together we can create a better tomorrow. Illegal logging and wood trade represent an forests had sustainable forest management important global issue. It is one of the key 29 30
Sustainability Sustainability A memorable cafe makeover It then decided to offer free help to the playfulness to the shop, and brought more school in redesigning the cafe. In early goodwill and ease into the children’s lives. Yanglingzi School is the largest special March, co-workers from the IKEA store were The experience gave the volunteers from education school in Zhejiang Province. The recruited to join the working team, and the the IKEA Hangzhou Store a strong sense of Wisdom Tree Cafe is a offline coffee and design was decided in mid-April. Soon after fulfillment. cake shop sponsored by the local education that, 48 volunteers from different functions department, the Civil Affair Bureau, and at IKEA Hangzhou store completed the One of the colleagues from IKEA Hangzhou associations of people with disabilities. The physical makeover in just 2 days. Store who participated in the makeover cafe recruits Yanglingzi alumni as staff to was Yvonne Lou said, “We usually focus on encourage them to be self sufficient by The cafe got a more friendly atmosphere playing our own roles when we work in the working in the shop and find happiness. after the makeover. The colors were store. This makeover, however, brought The shop is like a home and safe haven for brighter, and the place on the whole looked us all together to contribute our ideas them. The special little shop is often visited more like a cafe. Having tables and chairs and skills and help turn the cafe into a by big-hearted Hangzhou residents. that could be paired freely increased the home for the children. We were very much seating capacity to 20 and provided a place moved by the smiles on their faces. This Following the idea of creating a better for customers to put their bags. There was makeover meant a lot to the users and to life for the people and communities, the also an additional shelf where students’ the builders.” IKEA Hangzhou Store sustainability team work and products could be displayed. conducted a comprehensive inspection and Meanwhile, the message wall in the shop The partnership between IKEA Hangzhou chose Yanglingzi School to be the first local was replaced by an easel to make it easier Store and Yanglingzi School continued after school partner for IKEA Hangzhou Store. A for customers to leave a comment or wish. this makeover. We organized IKEA Day for memorable cafe makeover was born. IKEA co-workers and Yanglingzi students to The re-opening was attended by IKEA enjoy a day of handmade crafts. We tried In January 2016, IKEA learned from volunteers and the students. Everyone had to sow the seeds of love and goodwill and the school and the students about the cake and a great time at the celebration. create a better life for the children and their challenges in space design, storage, This was a makeover full of love and community. lighting, and color coordination at the positive energy. It added more fun and Wisdom Tree Cafe. 31 32
Sustainability Sustainability “For 15 years, we have been working as a “IWAY allows me to give 100% at work and “As a member of the IKEA I Care project team in making China greener. Together we be free to spend time with my family after team, I was motivated and worked hard can make things happen!” work. This is how IWAY has improved my to promote the project. We tried to have family life.” more factories and more colleagues join Huang Wenbin the effort to help bring more migrant Director of Forests, WWF-China Employee of an IKEA supplier in Yantai families together. I am very proud to have participated in a project like this one!” “As an IKEA forest expert, I have visited “During my 20 years with IKEA, I have had many places where IKEA wood products the honor of witnessing the development Li Yin were sourced in the last decade. I have of IWAY in China and see firsthand the Sustainability Project Leader been to forests in China and in Siberia. I progress that we have made and its positive IKEA Purchasing & Logistics East Asia have seen the sun rise over the Greater impact. I feel very lucky to be working Khingan Mountains, and I have experienced for a responsible company that pays the beauty of walking through a bamboo attention to people and the environment. forest in the rain. The one thing I am very Meanwhile, I am very proud of the efforts proud of is working with our co-workers, and contributions made by myself and my suppliers, forests/forest farmers and other colleagues to IWAY! The IWAY journey partners in ensuring our wood come from has been full of frustration and emotional more sustainable sources. I feel my job is moments, but it is very much worth it! Let’s very meaningful.” keep up the work!” Tai Wen Mandy Fan IKEA Forestry Manager Sustainability Compliance Manager, Asia IKEA Purchasing & Logistics East Asia Pacific IKEA Group “I brought IKEA volunteers to visit Puer, the children’s faces. They were beautiful disaster relief supplies worth RMB570,000 Yunan in the autumn of 2013. We went to and full of life. We were different, and yet on behalf of IKEA China. To ensure the find out for ourselves how the IKEA Soft we were the same. I always get a strong, supplies would be delivered promptly to Toys for Education campaign was supporting positive feeling whenever I remember their the disaster area, many of our co-workers Save the Children’s inclusive education smiles.” worked overtime, but we all felt it was project and helping children with special something we had to do and a responsibility needs to have a happy childhood and grow Shen Yan, Strategic Communication that we shared. Home is the most important up to a productive member of society. With Manager place in the world. We could not join the the inclusive project, local children with IKEA Retail China front line relief efforts, but we were able special needs were able to enjoy school to unite and send our support to those in as normal children would. We had lessons “Hubei was struck by severe floods in need.” together and played together during the summer of 2016. Many houses were recess. We gradually learned to accept our seriously damaged, and a lot of people had Huang Jinjin, Store Manager differences and enjoy them. What I took to stay at temporary disaster relief points. IKEA Wuhan store away from the field trip was the smiles on IKEA Wuhan Store immediately donated 33 34
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