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Govt wants Ikea to tap local products

The Philippines is working on a plan to penetrate the world’s biggest home retailing network Ikea and supply some of the materials for the products the Swedish company sells.

Senen Perlada, the Trade Department’s director for export and promotions, said the agency proposed to Ikano Group, owner of the Ikea franchise in Manila, to source some of the materials, if not the products, to create the designs for the Swedish firm.

“If we could just supply 1 item and I suggested we can deal with the numbers if we start in the Asean. We know that what the company needs is a system-wide supply, but starting with Asean isn’t bad,” Perlada said.

The Ikano Group, which was originally part of Ikea board, holds the franchise for Ikea Malaysia, Singapore, Thailand and the Philippines.

Ikea is set to build its largest Asean store in Manila.

Perlada said one limitation Ikea has is that product designs should come from Sweden.

“They do not allow designs to come from other sources. Everything else, the designs in particular are very Swedish-centric. But with the supply of materials, that’s where we come in,” he said.

Perlada said the Philippines could start with something as simple as a kitchen implement, something made of wood or bamboo like a chopping board or perhaps, a pillow case, or something organic like food.

He said the Philippines has a treasure throve of good and quality home furnishings and knick-knacks that are all export-quality.

Perlada said one should only look at the product line-up of “Go Lokal”, a marketing program of the department, to find out how good Philippine-made products such as food, clothes and health items are.

He said with Ikea, the price should be competitive enough as all Ikea products adopt the global pricing.

“They’ll do the selling for us. It has to be competitive since they have this thing on global pricing. This is a challenge for us—to do well with export, get the volume we need and the proper pricing for our products. But I think Ikea is good company to work with,” he said.

Ikea has around 9,000 stock keeping units of well-designed, functional home furnishing products, at any given time.

Ikea announced its partnership with SM Prime Holdings in October to build its biggest store in Asean.  As a tenant, the store will be leasing a total of 65,000 square metres of space from SM Prime right beside the MOA Arena.

Topics: Ikea , local products , Ikano Group
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