Improving product availability: A case study at IKEA Kitchen and Dining

Abstract: A global and still expanding leader in the home furnishing industry, IKEA, with its head office for development of the product range in Swedish Älmhult, wants to reach out to as many customers as possible. Cost efficiency has always been a driver, but in recent years an initiative on product availability has been launched, aiming to increase customer satisfaction. Kitchen and Dining is a Business Area with special conditions. This report strives to find the root causes, trade-offs, and remedies to insufficient availability, with an end-to-end Kitchen and Dining supply chain perspective. A case study approach was used to describe and understand the connection between many of the relevant functions and roles in the supply chain. The performance of two stores in different markets were looked at more closely. Through triangulation between interviews, workshops, and a questionnaire, there were found six causes that both are perceived to have a high impact on availability loss and that are most feasible to change. All six were discussed with a group of experienced IKEA employees with the goal to suggest potential improvements. Highlight was also put on one of the stores that during a period showed exceptionally low availability performance, bringing forward the issues that were shared by its representatives. Findings were discussed, reconnecting to literature, and it was concluded that the context of IKEA is distinctly different from that found in the relevant literature, that many issues could be addressed by improving communication, and that the mind-set of maximising availability can conflict with the overall strategy of the company.