(9-7-10) IKEA

  1. How has the globalization of markets benefited IKEA?
    1. IKEA originally supplied products that were too small for US consumers. They had to change their designs in the US. This increased their profit drastically. Also, in China they have a balcony section because most Chinese apartments have balconies. IKEA has increased their profit by opening stores in many different countries. They sell products that look good and cost very little.
  2. How has the globalization of production benefited IKEA?
    1. IKEA has parts made in many different countries to decrease costs of a single product. They cut the cost of a loveseat by 40% for example.
  3. What does the IKEA story teach you about the limits of treating the entire world as a single integrated global marketplace?
    1. IKEA has done well by using the world as its playground. They have the opportunity to pick and choose who they buy supplies from and cut costs. Their goal is to cut 2-3% every year.

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