00:00Tell us about the kind of trade you're expected to do in the first few days and weeks.
00:05Yeah, we're super humbled and touched by the big excitement and anticipation.
00:10And opening in New Zealand has, of course, been a dream for a long time.
00:14And tomorrow, Thursday, it comes through.
00:16We have high hopes to see how we can make a really good life at home in Australia
00:22and in New Zealand with the lowest possible prices.
00:25Well, we did hear from IKEA's retail manager, Tolga Onku, earlier.
00:32He did describe going to New Zealand as, and I quote, a leap of faith.
00:36Now, of course, the New Zealand economy is not in a great place.
00:39Consumer confidence is quite soft.
00:41And in terms of the markets you operate, you know, Auckland's a smaller city.
00:46So what's your target for sales and revenues from this new store over the first fiscal year?
00:50And what we have learned of being in many, many home visits, it's that life at home is super important for the many New Zealanders.
00:59And affordability and the cost of living crisis is also hitting hard here.
01:04But we have high hopes for a great business in New Zealand.
01:08And we see that from the anticipation and also the excitement we see.
01:12So high hopes and a big welcome for everyone.
01:15And we were opening this store that I'm standing in today, but also online across total New Zealand.
01:21So everyone living in New Zealand will be able to shop from IKEA from day one.
01:26Mikhail, the idea of entering the New Zealand market, to your point, has been around for quite a long time, since 2019, I believe.
01:40Why is now the best way possible, in IKEA's words, and the best time possible, given, as Paul highlighted,
01:49we are seeing lackluster growth in New Zealand.
01:53Does that affect the outlook of what's to come?
01:56And most important for us is to find a good location for our store.
02:01And now in Auckland, close to Sylvia Park Shopping Center, we have found a perfect location where we opened this big store.
02:07And then it has taken time also to build the infrastructure and prerequisites to offer online sales across New Zealand from day one.
02:15And economy goes up and down.
02:17But the value and the importance of life at home will always be there.
02:21And so does the low prices and affordability.
02:24And our DNA is built on low pricing for home furnishing products to create a little bit of a better everyday life for the many, now also in New Zealand from tomorrow.
02:34Right. To your point, maybe more price conscious consumers will turn to brands such as yours.
02:43Talk to us about beyond New Zealand, though, what are some of the other markets that IKEA sees opportunities in and how aggressive might any potential expansion be?
02:55Well, we're always trying to reach more of the many, so expansion is in our DNA and we have important markets in China, US, but actually our business starts and ends in the life of the many people in their homes.
03:11So that is where we want to expand and affordability is becoming even more important than ever with the life of a cost of living crisis and inflation we see.
03:22So we're striving to offer the lowest possible prices wherever we operate.
03:26So we see a positive expansion going forward.
03:31In terms of lower prices, I mean, we're not seeing inflation everywhere.
03:35There's deflation in China and you've been lowering prices there as well.
03:40But what is the risk that that becomes a cycle that you just keep chasing prices lower and lower and lower?
03:46How enduring do you feel that strategy is going to be?
03:49Well, first of all, we have five dimensions, so we want quality, sustainability, functionality, design, always at a low price.
04:00And affordability is relevant.
04:02It's the size of the wallet that is the most important.
04:06And people's lives at home becomes more and more important.
04:09So the more affordable we can be, we don't see an end to how much we can chase that target.
04:15It sits in our DNA to be the most affordable home furnishing retailer in the world.
04:22It sounds as if you're well prepared for a price war in China.
04:26Would that be a fair assessment?
04:28I wouldn't call it that.
04:30We start with the many people and what they want to achieve at home.
04:34And we build our products from that.
04:35And then the pricing and affordability is just our DNA.
04:40How much further might you be committing as part of efforts to keep prices low or slash prices in the Chinese market?
04:51It's not about slashing prices.
04:55We try to build our business model as efficient as possible, a global supply chain as efficient as possible, to offer the best and the lowest priceable we can.
05:06And that will continue going forward.
05:08Can you tell us a little bit about your outlook for Japan in the coming year, another major market in Asia?
05:22Well, Japan, I'm not working that closely with at the moment.
05:25But the team in Japan are doing super good efforts, expanding with some new concepts and also in the online business, complementing the 10 stores we have there today.
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