New generation takes reins at Ikea as founder lets his three sons take over

Firm's founder, Ingvar Kamprad, withdraws from business, puts three sons in charge

PUBLISHED : Saturday, 08 June, 2013, 12:00am
UPDATED : Saturday, 08 June, 2013, 3:39am

Asked if he would ever quit Ikea, 87-year-old founder Ingvar Kamprad told an interviewer last year he "had no time to die".

But his latest step back from the world's biggest furniture group has pushed a younger generation to the fore.

Kamprad, who founded the business 70 years ago and is one of Europe's wealthiest men, will leave the board of a major company within the business, Inter Ikea, which owns the brand and directs strategy. He stepped down as chief executive in 1986. His youngest son, Mathias, will become chairman.

Beneath the title changes, a big business with more than 300 stores and 690 million visitors is shifting to Mathias and older brothers Jonas and Peter, all in their mid- to late 40s.

"These children have grown up talking Ikea at the breakfast, lunch and dinner tables. You can't get a more thorough education," said Bertil Torekull, author of Leading by Design: The Ikea Story.

"They come in with their generation's ideas."

Some say Kamprad is being gently eased out.

"My impression is that at Ikea … they let him say what he wants, but they don't pay much attention," said Bosse Vikingson, a journalist who has followed Ikea for more than a decade.

Earlier this year, Ikea's chief executive said he planned to double the rate of expansion to about 20 to 25 new stores a year. Kamprad later told a Swedish daily he had not been informed.

Ikea has grown despite austerity in Europe, and the three sons must now take up the challenge of spreading into markets like China and India and making further inroads online.

They have the advantage of instant brand recognition; the company claims its catalogue - 212 million copies last year in 29 languages - is the second most read publication after the Bible.

The sons each focus on one of the three groups that make up the empire: Jonas on Ikea, Mathias on Inter Ikea and Peter on Ikano. The groups all have separate ownership structures.

But their reclusive father's shadow is still everywhere. He formally acts as "a senior adviser" to Ikea, the owner of most stores, and has key positions in foundations that control the empire.

After flirting with Nazism during the second world war, for which he has apologised, Kamprad built the business from a shop in his garden shed in the 1940s, selling watches and Christmas cards. His "flat-pack" furniture concept, begun in 1956, helped save a fortune in transport, storage and sales.

Saving money has become something of a hallmark for the billionaire: he reportedly flies economy class and still frets about the number of meatballs served in the in-store restaurants.

But he knows how to make money, too. Having more than doubled sales in the past decade to €27.6 billion (HK$282 billion) last year, Ikea, which owns most of the stores, plans to double them again by 2020.

Ikea published interviews with the sons over a year ago in its in-house magazine, with photos of them in T-shirts and jeans under a simple banner headline: "The Future".