Swedish home furnishings giant IKEA is set to significantly scale its India operations, announcing plans to open 25 new stores over the next five years, as it sharpens its focus on urban accessibility and long-term market growth.
The expansion marks a clear shift in strategy, with IKEA prioritising small and medium-format stores ranging between 2,500 sq. ft. and 20,000 sq. ft., instead of relying solely on its iconic large warehouse outlets. These compact formats are designed to penetrate dense city centres and high-footfall locations, enabling the brand to build a wider and more accessible retail footprint across India.
India has emerged as a priority market for IKEA’s global growth ambitions, with the company continuing to invest in both physical retail and e-commerce integration. Alongside the new stores, IKEA is also developing large-format destinations and mixed-use projects in key metro regions, including upcoming locations in Gurugram and Noida, while strengthening its presence in Hyderabad, Mumbai, and Bengaluru. The company is targeting profitability in India by FY2028, supported by scale expansion, improved supply chain efficiencies, and increased local sourcing.
Globally, IKEA operates through a highly structured franchise system, which remains central to its international expansion strategy. The brand is owned and franchised by Inter IKEA Systems, which grants franchise rights to operators across markets. The largest franchisee, Ingka Group, runs the majority of IKEA stores worldwide, including those in India. This franchise-led model allows IKEA to maintain strict brand consistency, standardised store formats, and a unified customer experience, while enabling local market adaptation and large-scale capital deployment by franchise partners.
IKEA’s global network spans over 60 markets with more than 470 stores, making it one of the most extensive and standardised franchise systems in retail. Unlike traditional franchising models that rely on multiple independent operators, IKEA works with a limited number of large, tightly controlled franchisees, ensuring operational discipline, supply chain integration, and long-term investment alignment. Franchisees pay fees to Inter IKEA Systems for the use of the brand, concept, and intellectual property, while adhering to strict guidelines covering store design, product assortment, sourcing, and customer experience.
The India expansion reflects broader global franchise and retail trends, where international brands are increasingly adopting flexible store formats, omnichannel ecosystems, and localisation strategies to unlock growth in high-density, high-growth markets. For the franchise sector, IKEA’s approach underscores how centralised brand control combined with local execution can drive scale while maintaining consistency across geographies.
