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2007-10-17 BMGT IKEA

2007-10-17 BMGT IKEA - Alan VanToai BMGT298 0701 IKEA's...

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Alan VanToai October 17, 2007 BMGT298 0701 IKEA’s Global Sourcing Challenge: Indian Rugs and Child Labor The foundation of Ikea’s business strategy lay on the strong values and beliefs of its founder, Ingvar Kamprad. As Kamprad learned more about the Swedish furniture industry during the founding years of IKEA, he disliked what he saw in the way of Swedish furniture cartels keeping prices high. His vision foreshadowed the business strategy of IKEA, where IKEA would take part in “creating a better life for the many people.” He wanted to offer home furnishing of “good design and function at prices so low that the majority of people can afford to buy them.” The search of lower-cost sources led IKEA to it’s next key component of it’s business strategy, not to own it’s production but develop close, long-term relationships with suppliers. This relationship “led IKEA to make loans to its suppliers at reasonable rates, repayable through future shipment.” Those
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