The Biography of Ingvar Kamprad : Net Worth, Career, IKEA

Ingvar Kamprad: A Tribute (1926- 2018)

Mr. Kamprad was a Swedish self-made billionaire and business mogul. He was the founder of IKAE, the most valuable furniture retail company.

Net worth

$58.7 billion as of January 2019

Early life and education

Feodor Ingvar Kamprad was born on 30 March, 1926 to Berta and Feodor Kamprad in Smaland, Sweden. At an early age of 5, he picked interest in business practices and sold matches to neighbors. He would later have this to say about his first business experience, “My aunt helped me to buy the first 100 boxes of matches on the sale of the so-called 88 ore in Stockholm. The whole package was worth 88 ore, and the aunt did not even make me pay for postage costs. After that I sold a box of matches at a price of 2 or 3 ore and some 5 ore. I still remember the pleasant sensation experienced by receiving my first profit.”  By 7, he expanded his matches business beyond his neighborhood to sell to other customers. His business strategy at the time was buying matches at a lower price in bulk from Stockholm, and reselling them at a fixed price just enough to fetch him some profit. As he grew into teenage hood, his business interest widened ad he began selling other commodities such as seeds, fish, stationery, and Christmas decorations.

By 17, Kamprad further expanded his business interest by including furniture in his business portfolio. With the money he had saved from past businesses and personal savings, he was able to start a low-scale furniture business where he sold replica of a relative’s kitchen table. It was then he founded IKEA.

Kamprad wasn’t only dedicated to his business, but his academics as well. In 1943, he enrolled at Goteborgs Handelsinsitut where he studied for two years.

Career

In 1943, at the age of 17 Kamprad started his furniture company called, IKEA. The name was formed from his initials Ingvar Kamprad and the other letters were gotten from Elmtaryd and Agunnaryd the place he spent his childhood. Alongside selling imitation low price furniture, the company also channelled its business focus towards pen retailing, and there was an ever-increasing demand for pens.

Kamprad small scale business, IKEA yielded enough returns and started gaining recognition in 1948, and by 1951 the Kamprad settled the focus of the business on domestic furniture. He also introduced company booklets called the IKEA News which were distributed amongst staff and customers. With time the booklets became IKEA catalogs which also gained wide recognition in past times.

In 1953, he opened the company’s first showroom in Almhult, Sweden. Despite a growing customer base and high returns, Kamprad retained his business strategy of selling at lower prices to beat the competition. At the time, furniture was considered luxury due to the high cost, and IKEA was the answer to the majority who couldn’t afford high cost furniture. This act birthed one of Kamprad’s business philosophies which states that “it is better to sell 600 chairs at a lower price than to sell 60 chairs at a high price.” An industry boycott was set against IKEA by other competitors to pressure the company about its relatively low prices. By this, the Swedish Federation urged loggers to cut all business ties with IKEA, unknowingly to them this act only launched the company into its next business phase— manufacturing its own furniture and purchasing materials from Polish suppliers. Manufacturing their own product in turn lowered importing costs and gave customers easy access to the merchandise. After a trip to the U.S. where he first came in contact with the ‘cash n carry’ system, Kamprad also implemented that method into IKEA where customers could properly assess the furniture, pay in cash, and transport the merchandise themselves. The company also devised a new method of packaging the merchandise in such a way that they could fit into other retail stores outside of the warehouse. 

Eventually, IKEA began opening its own retail outlets with the first in 1958. The retail outlets or showrooms didn’t have enough merchandise on their shelves initially, which was a business mistake Kamprad made. By the early 1960s the mistake was corrected, and the IKEA showrooms were transformed into a one-stop-shop for furniture finishing lovers. On display were not only sofas and cabinets but also bedspreads, curtains, tablecloths, candle holders, towels, dining set, and so on. The IKEA warehouses also had ideal furnishings for living rooms, dining rooms, and bedrooms that way customers can have a proper idea of the kind of furnishings they want.

By 1963, IKEA had begun multinational expansion beyond the shores of Sweden. Its first international market was Norway, then Switzerland, Australia, Netherlands, France, and America.

 Currently, IKEA has over 250 multinational retail outlets opened. One certain thing about Kamprad was his never-ending business strategy applications, from maintain standard quality and low prices to offering a free cup of coffee and a bun to attendees at the presentation of his shop. This idea would later pave way for a new business venture for IKEA—including restaurants in all its retail outlets.

In the early 2000s, IKEA took the next big business step to start selling its merchandise online. At the time e-commerce was starting to get popular with a lot of other companies taking advantage of the internet. The company closed more sales and generated even more revenue through its internet sales.  IKEA has recorded multinational sales success in for over five decades, and it has still managed to hold the top spot. Its major competitors are Ilva in Denmark and Argos in Italy.

Before his death in 2018, Kamprad resigned from the IKEA board in 2013 at the age of 87. His son, Mathias also assumed position as chairman that same year. According to Kamprad the company was in need of a generational shift.

Other interests

Though a business man, Kamprad still took interest in sharing his philosophies, victories and trials with others, as seen in his published books; A Testament of a Furniture Dealer (1967) and Leading by Design: The IKEA Story.

Cause of Death

Kamprad died on 27 January 2018 in Smaland, Sweden. The cause of his death was pneumonia (he died in his sleep). He died at a ripe age of 91.