Nitori Holdings: Japan’s Furniture Market & Ikea Competition
Former Sales Manager at Ikea
inpractise.com/articles/nitori-holdings-japans-furniture-market-and-ikea-competition
Former Sales Manager at Ikea
Interview Transcript
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Are they cost-competitive with the larger companies?
They are. Distribution plays a significant role. Companies like Nitori and MUJI have offline stores where they are competitive, and their online presence is a traditional ecommerce experience, not optimized for digital marketing. It's difficult for them to compete with smaller players who optimize their products for marketplaces, complying with Amazon FBA rules and adapting to Sagawa and Yamato's requirements, which dominate last-mile delivery.
This is a snippet of the transcript.Contact Salesto get full access.
Are they cost-competitive with the larger companies?
Nitori, IKEA, and MUJI still optimize for their major offline channels, making it difficult to compete online. As distribution and consumption move online, it becomes trickier. Three or four years ago, I would have said they were winning because ecommerce was slow, but now, in some categories, 50% of consumption is happening online. It raises the question of how long they can remain competitive.
This is a snippet of the transcript.Contact Salesto get full access.
How does that manifest in terms of the product offering? Are they able to offer quicker delivery times?
Nitori was one of the first in Japan to offer free delivery after a certain threshold. That was a project I tried to implement at IKEA, but it took me multiple years due to the lack of flexibility. Nitori was offering free delivery for orders over ¥7,000 or ¥8,000, which is about £75. IKEA couldn't do that because it would have required paying a lot of money to external companies like Sagawa and Yamato, which management wouldn't agree to. Nitori was ahead of the game in this regard. For IKEA, delivery was the number one concern for purchasing online and offline, whereas for Nitori, it was a strength. This is one of the primary reasons why Nitori has been outperforming IKEA over the last five or six years.
This is a snippet of the transcript.Contact Salesto get full access.
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