Better Every Day Life - IKEA Serving Customers in China for 20 Years - Swedish ...

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Better Every Day Life - IKEA Serving Customers in China for 20 Years - Swedish ...
Better
                                 Every
                                 Day Life
                                 IKEA Serving Customers
                                 in China for 20 Years

© Inter IKEA Systems B.V. 2018
                                                          2
Better Every Day Life - IKEA Serving Customers in China for 20 Years - Swedish ...
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
Better Every Day Life - IKEA Serving Customers in China for 20 Years - Swedish ...
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
Better Every Day Life - IKEA Serving Customers in China for 20 Years - Swedish ...
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
Better Every Day Life - IKEA Serving Customers in China for 20 Years - Swedish ...
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
Better Every Day Life - IKEA Serving Customers in China for 20 Years - Swedish ...
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.

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Better Every Day Life - IKEA Serving Customers in China for 20 Years - Swedish ...
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.

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Better Every Day Life - IKEA Serving Customers in China for 20 Years - Swedish ...
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.”

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Better Every Day Life - IKEA Serving Customers in China for 20 Years - Swedish ...
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.

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Better Every Day Life - IKEA Serving Customers in China for 20 Years - Swedish ...
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.

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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

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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.

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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.

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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

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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.

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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

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