It follows the debut of the format launched earlier this year at the Downtown Aura location in Toronto.
Michael Ward, CEO and Chief Sustainability Manager, said the planned Scarborough store is part of the retailer’s broader investment in sustainability, affordability, and omnichannel shopping experiences that help to make it more accessible to customers.
“There are other ones scattered around the world. London, Paris, places like this. It’s an exciting way for us to get a lot closer to customers who are more in city environments,” he said.
“A few years ago, even pre-pandemic, we were getting much more interested in how can we get closer to people who live in cities. The whole trend everywhere around the world is more urbanization, smaller space living, people living, working and shopping in tighter areas in urban centres. The idea was how to respond to that.
“We’ve built the company on these really big blue boxes that are more on the outside of the city. We started to look at and experiment with some formats.”
Ward said the format includes 2,000 to 3,000 articles that customers can pick up and take away with them. There’s also a food concept.
The company said the new ground floor location in the northeast end of the Scarborough Town Centre will be about 80,000 square feet in a building formerly occupied by a Sears department store. It said the scaled retail concept brings home to life in a new way. It takes the inspiring IKEA experience to the doorstep of urban residents and is proving popular with hundreds of thousands of customers who have made visits to the downtown store since it opened in May 2022.
When asked if more of these concepts will be coming to Canada, Ward said: “Right now we’re looking. We’re focused on the whole country. We’re, of course, interested in continuing urban expansion. So we’re looking. We don’t have any plans set right now for more of these small format stores but we’re always looking at the opportunities.”
IKEA has also released its newly-published 2022 Summary Report which reveals:
- National store visits have increased by 123 per cent to 26 million, while IKEA Canada sales increased 1.3 per cent to $2.6 billion in the financial year ending August 31, 2022;
- Despite the in-store sales resurgence, online shopping continues to play an important role in the IKEA Canada business. Customers made over 189 million online visits to IKEA.ca and the IKEA app between September 2021 and August 2022. 1.77 million orders were delivered, while 776,510 Click and collect orders were processed;
- Food sales increased 160 per cent to $97.5 million, with customers enjoying more than 20 million meatballs, nearly seven million plant balls, more than 1.7 million hot dogs and 1.8 million frozen yogurts.
“If you look at the year behind us, it was pretty unique, and lot of things going on, and not just us but I think everyone in the retail business as well that we needed to respond on. You start the year with the pandemic still upon us and sort of easing up as we went through the year – always leading with the health and safety of our coworkers and our customers first. That remained our prime priority,” said Ward.
“But then having to respond to several things. All of the supply chain constraints. The things that drove that in the beginning and then the War in Ukraine. And so on. It really put pressure on the whole supply chain end to end. And also on top of that, rapidly changing customer behaviours and expectations and needs and so on. For us really interesting during the whole pandemic the home became so much more important for everyone because they were doing so much more in it. Working there. Educating their kids.
“So you have all of these things going on at once and so for me the big takeaway is the fact that we could respond in a way where we really made a fantastic contribution to maintaining the health and safety in our operations with our coworkers, helping out people in our communities, but we were also able to grow. We were able to transform the business very quickly to respond to everything having to do with online and omni and the services that are required. We continued to experiment. We’ve also opened Plan and Order Points which are smaller formats in Montreal and Kitchener and we’re going to open another one in the South Shore of Montreal soon.”
IKEA said the 2022 Summary Report reflects a focus on making circularity and sustainable living solutions more relevant for customers across the IKEA business – from furniture to food. For example, Canadian consumers turned thousands of preloved products into in-store credit this year through the IKEA Sell- Back program, while more than 78,000 spare parts orders were fulfilled, and hundreds of Canadians attended Care and Repair workshops to maintain and extend the life of their IKEA furniture. Meanwhile, Canada has become one of the strongest global markets for the sale of plant balls, the recently launched plant-based alternative to IKEA’s classic meatballs.
“Our impact on the planet starts with the positive impact we make in the lives of our people. The continued growth and expansion we have achieved in Canada would not have been possible without the hard work, determination and skills of the co-workers who are at the heart of the IKEA Canada business. It’s only fitting that we show our gratitude through our actions,” said Ward.
Founded in 1943 in Sweden, IKEA is a leading home furnishing retailer. IKEA Canada is part of Ingka Group which operates 389 IKEA stores in 32 countries, including 15 in Canada.