Ikea May Open Ukraine Store In 2011, Targets Odessa

OSLO, Sweden -- Ikea, the world’s largest home-furnishings retailer, may open its first outlet in Ukraine earliest at the end of 2011.

The first store is likely to be in Odessa on the Black Sea coast, where Ikea owns land, said Frida Malmquist, country manager for Ukraine. The retailer opened an office in the country in 2005 and sees potential for six to seven stores, she said.

Ukraine, with a population of 46 million, is a “huge” and “underdeveloped,” she said. In Sweden, for example, the company has about 16 stores for a population of 9 million, she added.

“If you make that Swedish comparison, even though of course Ikea is overly popular in Sweden, because it has a long history, for sure you should be able to have 25 here, but it all depends on the development of Ukraine and its middle class,” she said.

Ukraine is facing a recession after nine years of growth. The global financial crisis forced the country, like Hungary, Romania and Latvia, to turn to the International Monetary Fund for help to avert a default and stabilize its banking system.

While Ikea isn’t halting plans in the country, the company isn’t in a “big rush,” Malmquist said. “It’s tricky to say when the Ukrainian market is ready for the size of retailing that we are coming with,” she said.

Source: Bloomberg