Swedish Furniture Giant IKEA Case Study

The points of the Porter's Diamond are described as four broad attributes. And these attributes promote or impede the creation of competitive advantage.

These attributes are: •Factor conditions --a nation's position in factors of production such as skilled labor or the infrastructure necessary to compete in a given industry.

•Demand conditions --the nature of home demand for the industry's product or service.

•Relating and supporting industries --the presence or absence in a nation of supplier industries and related industries those are internationally competitive.

•Firm strategy, structure, and rivalry --the conditions in the nation governing how companies are created, …show more content…

Swedwood also has a duty to transfer knowledge to other suppliers, for example by educating them in issues such as efficiency, quality and environmental work.

Swedwood has 35 industrial units in 11 countries.

Purchasing IKEA has 42 trading service offices (TSO's) in 33 countries. Proximity to their suppliers(1,800 of them in 55 countries) is the key to rational, long-term co-operation. That's why TSO co-workers visit suppliers regularly to monitor production, test new ideas, negotiate prices and carry out quality audits and inspections. TSO staff are also responsible for the important tasks of developing and checking working and social conditions, and environmental work among IKEA suppliers.

Distribution The route from supplier to customer must be as direct, cost-effective and environmentally friendly as possible. Flat packs are an important aspect of this work: eliminating wasted space means we can transport and store goods more efficiently. Since efficient distribution plays a key role in the work of creating the low price, goods routing and logistics are a focus for constant development.

Now 25 regional distribution centers in 14 countries are responsible for supplying goods to IKEA stores Firm Strategy, Structure, and Rivalry of IKEA's National Competitive Advantage The Business Idea of IKEA The IKEA business idea is to offer a wide range of home