They manage their low price since were able to reach cheaper labor and raw

They manage their low price since were able to reach

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price since were able to reach cheaper labor and raw materials, and their design is usually cost-free. Forthe Company to overcome this challenge, a number of course, of action must be put in place. There is a
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need for the company to put up many local factories in China and encourage the use of local raw materials. Ideally speaking, these local factories and material will settle the problem of high import taxes in China. The company should also perform an inspection on local quality before manufacturing to reduce the cost of repair. There is also need to reduce the cost of production by encouraging mass production and regulating the supply costs. IKEA should also start targeting the population category of the middle class. These are people with; higher incomes, well educated, they are aware of western styles and form the majority of the population (Johnson et al., 2011). With the IKEA marketing strategy, there was a challenge use of their catalog as a marketing toolgives their competitive advantage to imitate the company's products. It has been realized that competitors can copy the IKEA's designs to allow them to offer comparable products at lesser prices. To solve this problem, the company should use Chinese social media to reach the urban youth. There is also an issue of accessibility to the store in China. Unlike in Europe and U.S., where customers use personal vehicles, most customers in China travel by public means. This makes it difficult to access the stores. Therefore, IKAE should set up their stores on the periphery of cities which are reachable by rail and metro networks. To conclude with, IKAE's customers think about the Company as one, which provides low price, especially in durable furniture. Chinese consumers are looking at AKAE as the desired brand. The company should strive to comply with their customer's perception about the enterprise (Ivarsson, &Alvstam, 2010). They should regulate their high prices in India by building many local factories and encourage sourcing of local raw materials.
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