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IKEA to start selling through 3rd-party websites

Inter IKEA Group BV, the world's largest furniture retailer by revenue, will start selling products through third-party websites, its top executive said in a June 7 interview with Reuters.

At present, the company — known for its flat-pack furniture and warehouse-style shops — sells only through its own website, but it will start testing other online vendors from 2018, according to Torbjorn Loof, the CEO of Inter IKEA, the franchiser to IKEA Group. Ikea is made up of a web of companies, with IKEA Group the largest. The brand's biggest markets are Germany and the U.S.

Selling through third-party websites potentially could open up vast new markets for IKEA through online retailers such as Amazon.com Inc. and Alibaba Group Holding Ltd.

"I leave unsaid on which [platforms], but we will test and pilot, to see 'what does this mean, what does digital shopping look like in future and what do digital shopping centers mean?'," Loof told Reuters. An IKEA Group spokeswoman declined to comment when contacted by S&P Global Market Intelligence via phone and email.

In the year to Aug. 31, 2016, IKEA Group reported net profit of €4.20 billion, compared with €3.51 billion in the same period a year earlier. Revenue increased 7.4% to €35.07 billion. The company, which in May appointed Jesper Brodin as the new CEO, has a long-standing sales target of €50 billion annually by 2020.