IKEAAfter a long period of time, the multinational furniture company, IKEA, has, for the first time, reached the Autonomous Community of Valencia. The chosen location has been the municipality of Alfafar, a few kilometres away from the city of Valencia, and this decision ties in with the area’s tradition with the furniture industry.

IKEA is a multinational company founded in Sweden in 1943 by the entrepreneur Ingvar Kamprad, with the yellow and blue colours of its logo matching those of the Swedish national flag. It is interesting to highlight that Kamprad, who is currently 88 years old, began his business career as a child, selling matches on his bike to his neighbours in his native village. The Swedish firm’s founder seems to lend his own personality to the furniture company he created; the company is characterised by moderation, enabling furniture purchased in any of its shops to be put together at home. It has been written that Kamprad never travels first class, whether it be by train or plane, and he stays in hotels which are far from ostentatious. First IKEA in Sweden (1943)Other sources confirm that he even saves the salt and sugar that he does not use in the restaurants he visits, as well as buying Christmas presents in the sales. On the other hand, however, Kamprad owns a villa in Switzerland, a large property in his native Sweden, and some vineyards in Provence, France. This is understandable, considering he is one of the richest people in the world.

Characterised by adding a key design factor to all its products (something which Kamprad himself dares to call “democratic design”), the Swedish company manufactures furniture to suit any budget. The job of final assembly often falls on the client, and this contributes to reducing the cost of packaging, storing, and transportation. Famous designers have collaborated with the firm, although on many occasions, these collaborations have not been made public by either of the two parties. However, an example of a collaboration which has been widely publicised, thanks to the new IKEA opening, is that of designer Inma Bermúdez, who trained in Valencia. IKEA is also well-known for its restaurant, which serves traditional Swedish food (such as its famous meatballs)2013 IKEA Catalogue, and its annual catalogue, published for the first time in 1951. Nearly 200 million copies of this catalogue are published each year, accounting for 70% of the company’s annual spending on marketing, and is considered to be a real ‘event’ when released into the public domain.

The arrival of IKEA to Valencian shores has been talked about for many years, with different viewpoints on where the final location should be. In the end, Alfafar came out as the winner. However, what economic impact will this opening have? According to a study carried out by a group of professors from the Economics Faculty at the Universitat de València, including Alejandro Moyá (Marketing and Market Research lecturer), Marta Frasquet (professor of the same field), José Manuel Roig (Applied Economics lecturer) and Agustí Rovira (also in Marketing), the Alfafar store will take 23 of the 40 million euros that Spanish citizens annually invest in the Swedish firm. The study also investigates the impact on retail trade in the area, which could increase by 8.5%, affecting government tax revenue, as well as having a positive effect on employment levels (around 500 new jobs are expected to be created, IKEA boatboth directly and indirectly). The study also explains the impact from the construction of IKEA in Alfafar. The Swedish company has invested €98 million in building the store, and this has had a total production impact of €163 million for the Autonomous Community of Valencia, as well as creating 1,700 jobs. The study calculates that the taxes paid by IKEA in Alfafar will account for 4% of the total budget for this municipality. Tax contributions at a regional level will be more than €20 million per annum. Finally, the store is expected to receive 2.4 million visitors a year.