Ikea to roll out furniture leasing option
Swedish furniture retailer Ikea will begin offering the option to lease certain furniture pieces in Switzerland as early as this month, the Financial Times first reported. An Ikea spokesperson confirmed to Retail Dive that the pilot project is expected to roll out this quarter.
The service is the first in a series of tests that may ultimately result in "scalable subscription services" of various furniture items, according to the report. The company said leasing office furniture to business customers would be among the first trials, but kitchens could be the next space to be explored.
- The company, which has a reputation for promoting sustainability, hopes that this service will decrease the amount of furniture waste. "When that leasing period is over, you hand it back and you might lease something else," Torbjorn Loof, chief executive of Inter Ikea, told the FT. "And instead of throwing those away, we refurbish them a little and we could sell them, prolonging the lifecycle of the products."
Offering furniture leasing might resonate well with Ikea's urban millennial shoppers — a group the company has been increasingly vying for, especially through its smaller urban stores, partnership with kitchen planning and installation company Traemand and acquisition last year of TaskRabbit, which now offers furniture assembly services to customers — as furniture is a big-ticket item and transporting it between moves can be inconvenient and expensive.
It's not a new idea. Direct-to-consumer startups Fernish and Feather have built their businesses on a similar model: Consumers subscribe to pieces of furniture for a select period of time and can return, swap or buy based on their needs. Think Rent-the-Runway, but for furniture. Legacy players like Rent-A-Center, which has struggled recently, similarly lease furniture and appliances.
Ikea's move not only offers consumers the flexibility to furnish their homes with less commitment, but by refurbishing and redistributing its products, it also reduces the amount of furniture waste it produces.
The company has reimagined the way it produces sofas, making it easier to disassemble the piece and salvage the materials rather than have it end up in a landfill, Loof told the FT. He added that the company hopes to reduce its carbon footprint by 15% in absolute terms. The focus on sustainability, including renewed and refurbished products, is taking root in retail more broadly as well. Outdoor retailers in particular have launched programs to ensure apparel gets reused, and brands like H&M and Calvin Klein are also investing in sustainable initiatives.