The world’s largest home furnishings retailer is planning a long-term transformation in its business model in China amid a weakening economy.
IKEA says it will focus on smaller stores and stronger online shopping, a major shift from its earlier strategy of expansion of larger sites in major cities.
It will shut down seven stores in China, including locations in Shanghai, China’s largest city, and Guangzhou, the fourth largest city.
The closures took effect on Monday and mostly impacted large mall locations.
IKEA said the move provides more flexibility in its business model in China.
The company plans to open more than 10 smaller stores as a replacement over the next two years, with Beijing and Shenzhen, the second and third largest cities respectively, as key markets.
it will still operate 34 physical stores, along with several digital channels and e-commerce platforms.
