IKEA plans five Russian stores by 2006

IKEA is planning three new stores in Russia by 2006 but must hike local production before it can make a profit here, the reclusive head and founder of the Swedish furniture giant said. "It's no secret that we have a certain loss today," Ingvar Kamprad, 76, whom Forbes ranks as the world's 16th richest person with an estimated worth of $13.4 billion, said at a news conference. "With high import taxes, we have had to suffer during the first years with a rather too small margin. So, we have to increase domestic supplies and volumes so that we can come into the black." Within three years, IKEA should have five stores in Russia with total turnover between $332 million and $443 million, Kamprad said. "That will enable us to find money for more Russian suppliers for the domestic market," he said. "Our goal is to furnish millions of homes in Russia, and not just for rich people," Kamprad said, adding that the average purchase value in a Moscow IKEA store is about 2,000 rubles ($63), the same as in Stockholm. IKEA hopes to raise sales of local production to 30 percent of total sales from the current 11 percent, the Saint Petersburg Times quoted him as saying.

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