IKEA: Unboxing the flatpack business model

12/5/23 7:00PM

Flatpack products

Following IKEA’s record-breaking global sales of €47.6 billion ($51.4bn) in its latest fiscal year, the furniture giant is spreading the joy a little, with IKEA employees in the US set to divvy up a bonus pot of $54m.

The bonuses come with the Swedish company in full expansion mode, announcing plans to slash prices, open 8 new stores, and set up 900 new pick-up locations over the next 3 years, as it looks to win over price-conscious American consumers.

Fat-stack profits

Like many retailers, IKEA’s business model works best at scale. Enormous, meticulously styled showrooms, packed with as many products as possible, help entice customers to spend an afternoon filling shopping carts with everything they need for their homes, and — often — many things they don’t. Indeed, if you’ve ever found yourself wandering aimlessly around IKEA, you’re not alone. IKEA’s store planners have mastered what’s known as the Gruen effect — leading you, both mentally and physically, through a dazzling and immersive store to tempt you into making impulse purchases.

That understanding of consumer psychology has worked wonders for IKEA — so much so that just looking at the chart of its sales for the last 22 years, you would be hard-pressed to pick up on the global recession of 2008/09 or the pandemic in 2020/21, as the IKEA juggernaut powered on. The Swedish company has also cracked the digital world, with 23% of its sales, or nearly ~$12bn, coming through online channels.

Tom Jones

hut’s off

Yum! Brands might have found a potential buyer for Pizza Hut

Yum! is in exclusive talks with private equity firm LongRange Capital about a sale, per reports.

Hyunsoo Rim

hot dogs & half tanks

Costco’s gas stations are breaking records as drivers seek cheaper fuel

Higher prices have pushed many members to the retailer’s pumps for the first time.

Max Knoblauch5/29/26

The Trump administration is reportedly planning a 50% made-in-America requirement for USMCA tariff relief

Qualifying for USMCA-related lower tariffs may soon require more US-made vehicle components, according to reporting by The Wall Street Journal.

The Trump administration is reportedly planning to introduce a 50% US content requirement for vehicles covered by the trade pact to receive lower tariffs. The content would be measured by cost, according to the WSJ.

There currently isn’t any US-specific requirement for those lower tariff rates, but in order to receive preferential tariffs, vehicles are must contain at least 75% regional content (components made in North America). Per Reuters reporting, the Trump admin is seeking to raise the regional requirement to 82%.

These reported plans are subject to change as the US negotiates USMCA terms with Mexico over the next few months.

Overall, Tesla will likely have the easiest time qualifying for any stricter requirements. The automaker’s vehicles contained the highest amount of US/Canadian content in 2025, according to American University research. Ford, GM, and Stellantis all scored lower.

Notably: the underlying government data that many domestic content measurements rely on intentionally combines US and Canadian components, so it’s difficult to know exactly how much of any given vehicle is specifically US-made.

Exclusive | Trump Administration Wants Autos Under USMCA to Be at Least 50% Made in America

These reported plans are subject to change as the US negotiates USMCA terms with Mexico over the next few months.

Tom Jones5/29/26

The $640,000 Luce makes the average Ferrari look like a bargain

Put aside the shape; put aside the smoothing out of Ferrari’s iconic sharp edges; put aside, even, the calls from former Chairman and President Luca Cordero di Montezemolo to “take the Prancing Horse off.” On the grounds of price alone, Luce detractors might have a point.

By now, many of us will have read the criticisms of Ferrari’s first fully electric vehicle, as the Luce — which was unveiled to the world earlier this week and promptly saw the company’s shares crash out in New York and Milan — gets subtly shaded by competitors online and not-so-subtly shaded by basically everyone else.

What makes all of this worse for Ferrari is that, even by the luxury car maker’s notoriously high standards, they’ve slapped a pretty hefty price tag on the Luce, and the company’s CEO, Benedetto Vigna, has already been forced to defend the €550,000 ($640,000) price point, saying yesterday that it’s “fair to pay for innovation,” per Reuters.

While Ferrari’s cars have been getting more expensive of late, as recently as 2022, Ferrari’s average revenue per car sold was around $340,000. At nearly twice that price, this new electric model is obviously proving a little much (visually, conceptually, and financially) for many loyal and long-standing fans of the Prancing Horse to stomach.