Most people think IKEA only sells furniture. But, IKEA is also one of the largest restaurant chains in the world, generating nearly โน20,000 crore annually from food sales.
What's even more fascinating is that IKEA never intended to become a food giant. It happened because the company identified a simple problem that was affecting customer behaviour.
๐ง๐ต๐ฒ ๐ฃ๐ฟ๐ผ๐ฏ๐น๐ฒ๐บ ๐๐๐๐ ๐ก๐ผ๐๐ถ๐ฐ๐ฒ๐ฑ
- Customers were leaving their stores midway through the shopping journey.
- Not because of product quality.
- They were simply getting hungry and tired.
- This was a much bigger issue for IKEA than for traditional retailers because:
A typical furniture store visit lasts around 45 minutes.
An IKEA visit often lasts 2.5โ3 hours.
- Customers walk through massive showrooms before reaching the checkout area. Many shoppers were mentally exhausted and ready to leave.
๐๐๐๐'๐ ๐๐ฟ๐ถ๐น๐น๐ถ๐ฎ๐ป๐ ๐ฆ๐ผ๐น๐๐๐ถ๐ผ๐ป
- Instead of treating food as a separate business, IKEA made it part of the shopping experience.
- The company strategically introduced Swedish meatballs, Hot dogs, Coffee and beverages
- Importantly, these items were priced extremely affordably.
- The objective was not to maximise food profits but to maximise furniture sales.
- As a result, IKEA positioned its restaurants at a critical point in the customer journey:
Right when shopper fatigue begins.
Right before the marketplace section.
- Customers eat, recharge and continue shopping.
๐ง๐ต๐ฒ ๐ก๐๐บ๐ฏ๐ฒ๐ฟ๐ ๐ง๐ฒ๐น๐น ๐๐ต๐ฒ ๐ฆ๐๐ผ๐ฟ๐
- Serves approximately 700 million restaurant guests annually.
- Sells nearly 2 million meatballs every day.
- Sells over 1 billion meatballs each year.
- Generates roughly 6% of IKEA's global revenue.
- Contributes nearly โน20,000 crore in annual sales.
- Around 30% of visitors come primarily for the food experience.
๐ง๐ต๐ฒ ๐ฃ๐๐๐ฐ๐ต๐ผ๐น๐ผ๐ด๐ ๐๐ฒ๐ต๐ถ๐ป๐ฑ ๐๐
- A low-priced meal sends a powerful signal to customers:
If IKEA can sell food this cheaply, customers assume its furniture is competitively priced as well.
- The restaurant reinforces IKEA's value-for-money brand positioning.
- The food experience increases customer trust and reduces price-comparison behaviour.
In other words, the restaurant is helping sell wardrobes, sofas, dining tables and storage units.
๐ง๐ต๐ฒ ๐ฅ๐ฒ๐ฎ๐น ๐๐ฒ๐๐๐ผ๐ป
Many businesses evaluate every division independently, IKEA doesn't.
They are tools designed to:
- Increase customer dwell time.
- Improve customer experience.
- Encourage impulse purchases.
- Drive higher overall spending.
As IKEA founder Ingvar Kamprad famously said "It's difficult to do business with someone on an empty stomach." That single insight transformed a cafeteria into one of the world's largest restaurant operations.
One bigger lesson for businesses is that sometimes the most profitable part of your strategy is not your product itself but the experience built around it.