Political environment
This includes issues to do with government policies on taxation, tariffs and trade restrictions. It also encompasses employment laws and the activities and involvement of trade unions. Political stability of the environment is also important. IKEA's political environment is favourable. In Europe and America, the political systems have developed over long time providing a very stable environment. IKEA does not operate in Africa where most nations are not politically stable
Economic Factors
IKEA like most businesses in Europe and America is currently operating in global economic recession. In most countries, there has been slow economic growth for the last two years. Other economic factors are typical to each country and have to with inflation rates, interest rates, wage rates and minimum wage legislations.
Sociological factors
Markets where IKEA operates are faced with changing social trends. For example there are now fewer first time buyers in the housing market which is mainly due to hard economic times. Thus there may be a deceleration in the market's growth rate.
According to echeat.com, many people associate Sweden with a fresh healthy way of life. [3] This Swedish lifestyle is reflected in the IKEA product range. The freshness of the open air is reflected in the colours and materials used and the sense of space they create by using blond-coloured woods, untreated surfaces and natural textiles.
IKEA has also developed a very comprehensive corporate social responsibility program. IKEA's social responsibility policy gives a provision for humanitarian donations and support to various charities such as the World Wildlife Fund, UNICEF and Save the Children fund.
Technology
IKEA has embraced technology as a business tool. It has an up to date website from which customers can view online catalogues, check for stock availability before going to the store, order online and even correspond with the customer service team. As technology evolves, IKEA will perpetually keep on updating and upgrading its technology to keep pace with its global networks ranging from network relationships with supplier to those with distributors.