Inter Ikea, the franchiser of Ikea stores in 63 countries, announced it will cut 850 jobs as part of a cost-cutting effort prompted by declining consumer demand and rising expenses including US tariffs [1, 2, 3]. The layoffs represent roughly 3% of Inter Ikea’s 27,500-strong workforce [1, 2, 3]. About 300 of the job cuts will take place in Sweden, where Inter Ikea has a major hub in Almhult [1, 2, 3].
Henrik Elm, Inter Ikea’s Chief Financial Officer, said the company needs to "become faster, shorten the decision-making processes, and simply concentrate our efforts on these priorities" [2]. Elm added that lowering prices is critical because consumers’ disposable incomes are shrinking. "Our ability to lower the prices so they can afford Ikea is more essential than ever before, and of course you can't achieve that if you have too high a cost base," he said [1].
Consumer confidence has been declining for some time, but Elm said the 2026 Iran war has accelerated this trend by sharply pushing up fuel prices. He said, "The conflict has driven fuel prices up sharply, hurting household budgets and sapping consumers’ willingness to spend on non-essentials like a home renovation or new sofa" [1].
Inter Ikea is also adjusting its retail approach by shifting away from large suburban warehouse stores toward smaller city-center locations to better attract shoppers [1, 2, 3].
Inter Ikea and Ingka Group, Ikea’s largest franchisee that owns most Ikea stores, both changed CEOs in late 2025 after the company posted its second consecutive year of declining sales [1, 2, 3]. In March 2026, Ingka Group announced plans to cut 800 office-based jobs, adding to the job reductions across the Ikea franchise network [1, 2, 3].
The job cuts and strategy changes reflect ongoing efforts to respond to a challenging consumer environment and external pressures. The company said it will focus on improving speed and cutting costs while adapting retail locations to evolving shopper preferences [1, 2, 3].
