Summary Data

• Per Market (IKEA operates in 63 markets):

  • Lost Sales: $41.7M
  • Increased Operational Costs: $14.3M (assuming the operational cost increase is distributed evenly across markets)

• Globally:

  • Lost Sales: $2.63B
  • Increased Operational Costs: $900M

• Total Initial Investment: $13.1 million

• Annual savings:

  • $2.87 billion × 5% = $143.5 million

• Annual sales increase:

  • $2.87 billion × 2% = $57.4 million

• Total annual benefit: $200.9 million

NPS

• $180 million in lost sales annually can be attributed to distribution inefficiencies, calculated as 3% of total revenue adjusted for a 10% effectiveness factor.
• Improving delivery reliability could increase IKEA’s NPS from 50 to 57, bolstering customer loyalty and competitive standing in the furniture market.