Thanks To Supply Chain Bottlenecks, IKEA To Hike Prices By 9% This Year

As global supply chain problems persist, Swedish furniture maker IKEA plans to hike its prices.

CNN Business reported:

Ikea said prices at its stores will increase by an average of 9% around the world to help offset significant transportation and raw material costs incurred by Ingka Group, which owns and operates most of Ikea stores worldwide.

With its do-it-yourself philosophy embodied in its virtually staff-free showrooms to its flat-packed furniture, Ikea has become synonymous with low prices and value. Despite surging costs during the pandemic, Ikea stores had largely kept prices stable. But, as commodity and shipping prices continued to surge, the company said it was no longer able to absorb that damage to its bottom line.

“Unfortunately, now, for the first time since higher costs have begun to affect the global economy, we have to pass parts of those increased costs onto our customers,” IKEA retail operations manager said in a statement, according to CNN Business. “Our intention is to give back to the customer any decrease in purchase prices we get.”

Several industries in the United States are likewise pressed with cost pressures arising from the supply chain crisis. For instance, automakers are coping with a computer chip shortage. As a result, the Bureau of Labor Statistics’ most recent inflation report indicated that used and new vehicles — up 31.4% and 11.1% in price, respectively — are contributing heavily to inflationary pressures. – READ MORE