Leading global retailer IKEA’s investment arm, Ingka Investments, has acquired logistics technology startup Locus for an undisclosed amount.

Founded in India in 2015, Locus is currently headquartered in the US, with most of its operations still based out of India. “This strategic investment strengthens IKEA's digital capabilities, giving the retailer greater control over a critical moment in the customer journey”, IKEA said in a statement.

Locus offers a sophisticated AI-powered logistics management platform, featuring advanced route optimisation, real-time tracking, as well as the smart use of vehicles and resources. By integrating these capabilities, Locus will better enable Ingka Group to enhance efficiency across the supply chain - from capacity management and optimisation to last-mile execution, the company states. The partnership not only strengthens how IKEA delivers home furnishings to customers globally but also supports their ambition to create a faster and smarter distribution network, it said.

"This acquisition aligns perfectly with our commitment to improving the customer journey at every touchpoint. By bringing Locus's technology in-house, we're taking control of a crucial element in our fulfilment chain, allowing us to deliver with greater speed and flexibility to the many", Tolga Öncü, Head of IKEA Retail (Ingka Group), said.

According to IKEA, the acquisition of Locus marks a significant milestone in building a more robust supply chain in India and further strengthening the One IKEA approach of delivering impact across the value chain. Locus’ technology will help reduce complexities, provide seamless integration between systems and make IKEA’s logistical operations future-ready to handle the expected surge in home delivery volumes. The technology will not only enhance IKEA’s delivery logistics to customers in India but will also improve the overall customer experience, the company said.

“Joining the IKEA family marks a historic milestone for Locus and the customers we serve. This partnership preserves our independence and ensures our perpetuity, while unlocking the scale and resources to serve our global enterprise customers with unmatched research and development. To usher in this new phase, we will expand significantly across product, engineering, and revenue teams, to build a legacy of innovation and impact spanning decades, not years”,  Nishith Rastogi, Founder & CEO, Locus, said.

Locus will remain operationally independent while continuing to grow its services for partners beyond Ingka Group to support ongoing innovation and growth for both companies, whilst contributing to the IKEA broader digital transformation journey, the statement said.

Online sales accounted for 28% of total IKEA retail sales in FY24, up from 11% in FY19. IKEA hopes the integration of Locus’s technology will further strengthen its ability to meet this growth, complementing earlier strategic technology investments such as Made4net, which will help enhance the company’s warehouse management, and TaskRabbit, which expanded furniture assembly services.