Franchising Strategy
The IKEA concept which bring IKEA franchise worldwide is belong to the Inter IKEA System B.V in Netherlands. Inter IKEA Systems B.V is the franchisor and it is the owner of the IKEA concept and trademark (IKEAFANS, 2009). The franchisees have the right to operate IKEA store under the franchise agreements in accordance with franchisor's systems and methods to use IKEA trademarks establish by Inter IKEA Systems B.V(Inter IKEA Group, n.d.). Besides, IKEA franchisees able to access to the product range of IKEA and opportunity to continuously take part in IKEA concept development in their own stores. (Inter IKEA Group, n.d.). Then, IKEA franchisee has its own responsibilities to manage, develop and run their local market business with efforts after granting the rights of IKEA concept.
The main concept of IKEA want to expand its market by implement franchising is due to the objective of Inter IKEA Systems B.V.. According to the objective of Inter IKEA Systems B.V., its objective is to increase the availability of IKEA products through world-wide franchising the IEKA concept (IKEAFANS, 2009). So, this encourages the IKEA wanted to create infinity for IKEA through franchising.
Besides, the decisive factors for IKEA to franchise for long-term approach are due to its ownership structure and total independence in furniture market (Inter IKEA Group, n.d.). Thus, IKEA bring out the franchising method so that it can secure an infinite life for the IKEA concept when the different companies in different countries able to build the resources needed to expand global under IKEA concept (Inter IKEA Group, n.d.). Moreover, the franchisor, Inter IKEA Systems B.V. acts role to perform some important tasks such as expand IKEA business, improve and develop IKEA concepts, transfer know-how of IKEA to its retailers, monitor IKEA concept' implementation and protect IKEA concept (Inter IKEA Group, n.d.).