A Road From Selling Matches to IKEA Empire

Posted: March 26, 2011 in Brand management
Tags: , , , ,

Most of the time I am sharing my views and the latest news about campaigns and marketing activities of many global brands in this blog. However, today I will tell you the story of a brand man who has gained ground towards IKEA Empire. Surely, you all know the retail giant IKEA, operating in 38 countries with its 280 stores and 127 thousand of employees.

Ingvar Kamprad, the founder of IKEA, is the main hero in today’s story. His philosophy of life must be regarded as praiseworthy with his idea “people just don’t make mistakes when they are sleeping”. Tranferring this idea to his employees, he encourages employees to take responsibility without being afraid of making a mistake.

The most interesting point about his life is that Ingvar Kamprad, who was born in 1926, started his career at the age of 7 by selling matches. During his childhood, he continued his business life by selling different things such as Christmas tree and ornaments, fish, stationery equipment.When he was 17 years old, he founded IKEA with his pocket money which his father had given to him as a reward after he passed his exams. He created the name “IKEA” with the first letters of names of himself (Ingvar Kamprad), the farm (Elmtaryd)  and the village (Agunnaryd) he lived. Although IKEA only sold stationery, photo frames, bijoterie and socks, in 1948 it started to sell furniture. After they tried to put a sold table into a customer’s car by breaking off the legs of table in 1956, they began to sell disassembled furniture.

Although, 85 year-old Kamprad is the 11th person among the wealthiest people around the world with his 23 billion-dollar wealth, he is pudent enough to drive a 15-year old Volvo 240. Moreover, he prefers economy class in planes and uses two sides of papers. Living in Switzerland, in  a town that is near to Lausanne, Kamprad shops by bargaining with artisans and eats in IKEA restaurants in most of the time.

To maximize tax optimization, Kamprad manages his IKEA shares over a foundation in Liechtenstein. According to the news in The Independent, Kamprad earns 3 % commision revenue on each sale from IKEA stores. Although Kamprad says that an independent administrative board manages the foundation, it seems that Kamprad calls the shots.

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