(Yicai Global) July 14 -- Ikea will shut its only city centre store in the Chinese mainland at the end of this year, ending the Swedish furniture giant’s pilot city centre outlet project.

The decision to close the outlet in Shanghai’s Jing’an district was made after assessing the company’s business position in the city and the store’s long-term feasibility, Ikea China said yesterday.

The store opened in July 2020 and was Ikea’s first city center outlet in the Chinese mainland. It covers around 3,000 square meters, or 10 percent of a standard shopping mall, and besides showrooms with only 3,500 items on display, offers light meals and customized consultations.

The shop has many visitors, mostly young people, allowing Ikea to interact and communicate with younger consumers, Yicai Global learned.

This is not the first brick-and-mortar store Ikea has closed in China. It shut shops in Guiyang, Guizhou province, in April last year and in Shanghai’s Yangpu district in July of that same year.

Ikea values the Chinese market because China has a large population, and family is important to Chinese people, which is highly consistent with the firm’s vision, Sven Rau, vice president of Ikea China, told Yicai Global previously.

Ikea has expanded other stores in Shanghai, with one in Beicai town having recently set up new prototype rooms covering over 6,700 sqm. Its Shanghai Ikea Livat complex in the Hongqiao Linkong Economic Zone will also open for business next year.

Ikea entered China in 1998 and has 34 shopping malls, one city store, two experience shops, and some online stores on its own website, application on mobile ends, Tmall and WeChat. China and Sweden are the only countries where the company has a complete supply chain, including product design, testing, production, procurement, warehousing and distribution, retail, shopping centers, and other business units.

Editor: Martin Kadiev