Time for the Swedish chef: Ikea’s furniture profits are down in Australia, but food sales are booming
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Retailer reports 5% growth in restaurant and food business, with affordable meals attracting Australians feeling the pinch. It’s not unusual for a trip through one of Ikea’s labyrinthine stores to end with a $2 hotdog, but more Australians are skipping the flat-pack furniture altogether and heading straight to the dining section.
Ikea is seeing more growth from its in-store restaurants and food offerings than its home furnishings, according to its end-of-year results released last week, with its dining sales increasing by 5% in 2023-24 even as overall sales slumped. The Swedish group said it had been faced with a “challenging retail environment” in Australia, where it made $1.725bn in total – down 3.17% from 2022-23 – with an after-tax profit of $51.3m.
The company’s country food manager, Tim Prevade, said food sales had outpaced furniture sales for the first time in years, which he attributed to cost-of-living pressures. Sign up for Guardian Australia’s breaking news email. “People are being a lot more careful where they spend and what they spend, and maybe cutting back on big ticket spends,” he said. “But of course, people still need to eat … and you still want to take the family out to eat.”.
Ikea’s food is relatively affordable. A dish of Swedish meatballs will set you back $12, and you can get a chicken schnitzel or a plate of fish and chips for $14, according to its website, or a lamb shoulder with couscous for $16. There’s also packaged food for sale with a 1kg pack of frozen meatballs retailing for $16.
