There's a new business model for your - furniture renting! It doesn't matter if you are the largest furniture seller in the world, there are always possibilities to further your company's portfolio.
Ikea's Torbjorn Loof (the person in charge of the company's brand and concept department) sat down for an interview with the Financial Times and told them that the Swedish firm would soon be starting to experiment with furniture rentals.
In Sweden, the program will be deployed this month (February 2019), starting with desks and chairs with a plan to eventually roll out a scalable subscription service. However, no pricing information has been revealed so far.
“We will work together with partners so you can actually lease your furniture,” stated Loof. “When that leasing period is over, you hand it back and you might lease something else. And instead of throwing those away, we refurbish them a little and we could sell them, prolonging the life cycle of the products.”
Ikea has been a go-to for customers because of their relatively affordable prices. Even so, the global furniture market is earning roughly 472 billion USD every year. In addition to expanding their business model, Ikea is also looking to move their stores to more centralized locations within cities, instead of the suburban destinations most stores are currently located in with some additional changes in store sizes as well.
Ikea sees rentals as part of their three-year plan to help their business and to make the company more environmentally sustainable. The sharing economy has changed so much of how we move through the world — from Uber and Lyft disrupting transportation to Airbnb changing the way we vacation.
Businesses seem to believe the sharing economy is one way to grab shoppers’ wallets because of the so-called “end of ownership,” - this is an idea that authors Aaron Perzanowski and Jason Schultz coined to describe how shoppers prefernces have shifted from personal property in the digital era.