IKEA's warehouse in Borlänge, which opened in 2013, will be closed and replaced by a smaller store in a local shopping center next year. The current facility of 32,000 square meters will thus be replaced by an area of 5,000 square meters.
The reason for the decision, according to the company, is that customer purchasing behavior has changed. E-commerce today accounts for over 20 percent of IKEA's total sales, which has reduced the need for the traditional, large-scale warehouses.
Currently, 230 people work at the Borlänge warehouse. It is currently unclear how many of these jobs will be lost in connection with the transition to the smaller store format.
We wanted to communicate the changes as early as possible, which means we don't have all the answers yet. But we know that when we make changes, it also means changes for people, says Michael Parker, Acting Country Manager for IKEA in Sweden, to Dagens industri.
There is concern within the Handels trade union regarding how the staff will be affected by the decision.
When I received the information, I thought of my colleagues. Many will be affected when we move from 32,000 to 5,000 square meters. Many who have taken out loans for housing, bought a new car or started a family are very worried, says Miguel Fernandez Johnson, chairman of Handels at the workplace in Borlänge, to Arbetet.
IKEA's press contact, Louise Ridell Edinger, states that the company will inform employees in stages and that they are now continuing negotiations with the trade unions. Michael Parker adds that the Borlänge decision is not the start of a wider wave of closures in Sweden and dismisses that there are plans to close more warehouses.
Part of a Larger Transformation
The closure in Borlänge is in line with the broader restructuring that parent company Ingka Group is currently implementing. As Ehandel.se previously reported in March, the company announced that it is implementing cuts affecting a total of 625 jobs in Sweden.
The purpose of the reorganization is to redirect resources to the company's digital offering, logistics solutions and automation to create an integrated experience between e-commerce and physical stores. As part of this strategy, IKEA is focusing on establishing new, more cost-effective store formats in smaller towns – a concept that is now becoming a reality in Borlänge.