IKEA Is Setting Up A RM908 Million Regional Hub For ASEAN In Malaysia

The hub will be among the top 10 largest regional distribution centres of the global IKEA group.

Cover image via New Atlas

Swedish furniture giant IKEA will be establishing a regional distribution and supply chain hub for ASEAN in Malaysia

Image via ABC

With an investment of USD212 million (RM908 million), the hub will be among the top 10 largest regional distribution centres of the global IKEA group.

The hub will also adopt the structure and technology of IKEA's biggest regional distribution centre in Germany, said Malaysian Investment Development Authority (MIDA) as quoted by NST.

The hub will manage a vast inventory of 9,500 stock keeping units (SKUs) worth RM6.6 billion annually

Image via Business Wire

“IKEA’s new 100,000 sqm specialised warehouse will utilise its integrated information and communications technology systems and automation to reduce the dependency on labour and significantly increase the efficiency and accuracy of its inventory management processes,” MIDA said.

The centre will be serving 12 retail stores in ASEAN and it is expected to increase to 20 by 2026.

MIDA added that Malaysia had always been a significant market for IKEA, as retail stores in the country were among its most visited globally

IKEA Cheras.

Image via The Edge Markets

International Trade and Industry Minister Datuk Seri Mustapa Mohamed said this represents a significant milestone for both IKEA and Malaysia.

"IKEA’s decision of selecting our country as a base to support retailers in Malaysia, Singapore, Thailand, Indonesia, Vietnam, the Philippines, and India underscores the strategic fit of this country in supporting IKEA’s overall growth strategy in the ASEAN region," the minister said in the statement.

After two successful openings in Klang Valley, IKEA will be expanding its business to Johor and Penang

IKEA opened its first store in 1Utama Shopping Centre, Petaling Jaya in 1996. It then moved to Mutiara Damansara in 2003.

The company's second outlet in Cheras, Kuala Lumpur opened its doors in 2015.

The Johor outlet is set to open by the end of 2017 while the Penang branch will open in 2019.

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