Delhi is not a two-store market, says IKEA as it doubles down on NCR expansion

IKEA is accelerating its India expansion by combining smaller city stores with a growing digital business, a strategy the Swedish furniture retailer believes is helping it get closer to customers in one of its most important growth markets. The company will open its second Delhi city store in Saket on July 30, reinforcing its push into the National Capital Region even as its much larger-format Gurugram and Noida projects continue to be developed.

“Delhi is not just a two-store market. Delhi will be a multiple store market,” Adosh Sharma, country commercial manager, IKEA India, told Fortune India. The strategy, he added, is that city stores allow IKEA to expand faster while its larger integrated developments take shape.

On being slow in its approach in expanding in Delhi NCR, Sharma said, “The reason is we take a lot of time before we make a decision to enter a market. And in India, we've done a lot in terms of learning, adapting, adopting, evolving, and that's how we've come into our cities.”

The Saket outlet spans 30,000 sq ft and will stock nearly 3,000 products, including around 1,400 available for immediate takeaway. Customers will be able to order the retailer’s full catalogue of more than 6,900 products through its website, app and Shop by Phone service. The store has been designed after studying homes across South Delhi and will offer planning services, delivery, assembly, installation and an IKEA Café.

The expansion comes after IKEA entered Delhi NCR through e-commerce in 2025, followed by its first city store in West Delhi in Tagore Garden. Today, it has over 300,000 IKEA Family members in the region, operates a central distribution centre in Gurugram and is building full sized stores in Gurugram and Noida.

Although the projects in Gurugram and Noida are taking time to become operational, Sharma said, "India is not a story to make profits as soon as possible. We are in the long run here."

IKEA being vertically inclined and completely integrated, are keeping the door to quick commerce open as well.

“We are not closed to quick commerce. We are not closed to other platforms. We are open to seeing where the customer interacts the most and how IKEA can make that customer journey smoother,” Sharma said, adding that the company is still evaluating the space before making a move.

Omnichannel model driving growth

Unlike many furniture retailers that rely primarily on physical stores, IKEA says digital has already become a meaningful part of its India business.

“Our web and the app are two channels that contribute serious business to us,” Sharma said, adding that online now accounts for about 30% of IKEA India’s sales. He said the company expects its omnichannel strategy to help it reach customers beyond cities where it has stores, noting that opening furniture outlets requires significantly more planning than fashion retail.

That strategy is also shaping its long-term expansion plans. IKEA is targeting around 30 stores in India by 2030, with future expansion guided by customer demand rather than a specific metro or Tier II playbook.

Sharma said the company is already seeing encouraging demand from cities such as Jaipur, Chandigarh and Lucknow through its online channels and could consider offline expansion there in the future.

The company is also increasing localisation. Around 30% of products sold in India are sourced locally, and IKEA plans to raise that share further while developing products specifically for Indian consumers, including furniture made from materials such as mango wood and, eventually, teak.

“We are very aggressively chasing that to improve it even further and also look at products which are made in India for India,” Sharma said.

Food is another area where IKEA sees room for growth. While the café currently contributes just under 10% of the business, the company aims to double that over the next two to three years by blending Swedish favourites with locally relevant offerings at affordable price points.

Financially, IKEA India remains firmly in investment mode. The company reported revenue from operations of ₹1,749.5 crore for FY25, while net loss widened to ₹1,325.2 crore, continued spending on expansion and infrastructure. The retailer has consistently maintained that India is a long term market where scale and accessibility take precedence over near term profitability.