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The bolt that holds the Ikea empire together
Ingvar Kamprad is no ordinary multi-billionaire. The founder of the Ikea furniture empire travels economy class, drives a 10-year-old Volvo and buys his fruit and vegetables in the afternoons, when prices are often cheaper. Ask him about the luxuries in his life and he says: ‘From time to time, I like to buy a nice shirt and cravat and eat Swedish caviar’.
Mr. Kamprad is one of Europe’s greatest post-war entrepreneurs. What began as a mail-order business in 1943 has grown into an international retailing phenomenon across 31 countries, with 70,000 employees.
Sales have risen every single year. The Ikea catalogue is the world’s biggest annual print run – an incredible 110m copies a year. And Mr. Kamprad has grown extraordinarily rich. He is worth $13.4bn and is the 17th richest person in the world, according to Forbes, the US magazine.
The concept behind Ikea’s amazing success is unbelievably simple: make affordable, well-designed furniture available to the masses. And then there is Mr. Kamprad himself – charismatic, humble, private. It is his ideas and values that are at the core of Ikea’s philosophy.
Best known for his extremely modest lifestyle, he washes plastic cups to recycle them. He has just left his long-standing Swedish barber because he found one in Switzerland, where he lives, who charges only SFr14 for a cut. ‘That’s a reasonable amount,’ he chuckles.
All Ikea executives are aware of the value of cost-consciousness. They are strongly discouraged from traveling first or business class. ‘There is no better form of leadership than setting a good example. I could never accept that I should travel first class while my colleagues sit in tourist class,’ Mr. Kamprad says.
As he walks around the group’s stores, he expresses the feeling of ‘togetherness’ physically, clasping and hugging his employees. This is very uncharacteristic of Sweden. ‘Call me Ingvar,’ he says to staff. The informality and lack of hierarchy are emphasized by his dress style, with an open-necked shirt preferred to a tie.
Mr. Kamprad has had both personal and business battles. He has fought against dyslexia and illness.
One of Mr. Kamprad’s characteristics is his obsessive attention to detail. When he visits his stores, he talks not only to the managers but also to floor staff and customers. A recent visit to six of the group’s Swedish stores has produced ‘100 details to discuss’, he says.
By his own reckoning, his greatest strength is choosing the right people to run his business.
He is determined that the group will not go public, because short-term shareholder demands conflict with long-term planning. ‘I hate short-termist decisions. If you want to take long-lasting decisions, it’s very difficult to be on the stock exchange. When entering the Russian market, we had to decide to lose money for 10 years.’
Mr Kamprad has been slowly withdrawing from the business since 1986, when he stepped down as group president. He maintains that he is still ‘too much involved and in too many details’, although he admits to a distinct reluctance to withdraw altogether.
The question is: can there be an eternal Ikea without Mr. Kamprad? Does the group depend too mush on its founder? Will the empire continue, as control of Ikea gradually moves to Mr. Kamprad’s three sons?
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