Bad news for furniture shoppers out there: on Thursday, IKEA confirmed that the company would be raising prices on a good chunk of its historically budget-friendly catalogue. The culprit IKEA’s blaming for the price hike is — you guessed it — the dreaded supply chain.
“[U]nfortunately, there has been a significant increase in costs across the supply chain, including in raw materials, transport and logistics,” a member of the company’s support staff tweeted out earlier this week. “As this is still ongoing it is necessary to increase prices across many of our products.”
Supply chain woes are hardly unique to furniture retailers; tech titans, fashion brands, and even ketchup suppliers have all felt the economic squeeze wrought by COVID-19. To explain the issue in a nutshell: the ongoing lockdowns across the globe sparked a massive demand for deliveries. That surge in demand led to cargo ships clogging up ports with their undelivered goods, while shipping prices skyrocketed across the board.
And while there are many pieces involved with the supply chain that a company like IKEA uses to deliver a couch to your door, they’re all feeling some kind of hurt right now — and it was only a matter of time before customers started feeling it, too.
“Price increases vary but remain in line with what we are seeing globally at IKEA, which is approximately a 9% average increase across countries and the product range,” an IKEA spokesperson told The Guardian in a statement. “Affordability remains at the heart of our business, and our focus will always be on continuing to offer quality, sustainable home furnishings at an affordable price for the many people.”
Still, at a time when a good number of IKEA’s customers are feeling their own economic crunch from the pandemic, it stings to see a budget-conscious brand succumb to these issues. And as The Guardian’s own report points out, IKEA’s price hikes seem to far surpass the 9% increase the spokesperson cited; looking through archived versions of the company’s site, some products’ prices spiked up to 50% in the past few months alone. A desk that was once £99 (roughly $134 USD ($185)) jumped to £150 (about $203 USD ($280)), a daybed that used to be £215 (roughly $US290 ($400)) is now £279 (close to $US377 ($520)). For some shoppers, these once-affordable options are now squarely out of their budgets.
The new quotes might be a shock for some, but IKEA’s already warned us all that a price hike was imminent. In an annual financial summary released this past November, the company reported that keeping its stores and warehouses stocked has been “a challenge,” and an expensive one at that.
“The global pandemic affected our operating income in FY21. The biggest cause was the steep increase in transport and raw material prices in the second half of the financial year,” IKEA wrote at the time. “Supply chain disruptions led to a substantial drop in the availability of products that we have yet to recover from. We expect this will continue far into FY22.”
In other words: expect the prices at IKEA to keep rising well into the new year. If you’re looking for a cheap coffee table in the meantime, it might be better to scour your local second-hand shop instead.