Ikea founder advises more job cuts

Stockholm Ingvar Kamprad, founder and current advisor to the Ikea chain, said Tuesday that the retailer needs to cut additional staff in the face of weaker consumer demand.

According to a Reuters report, Kamprad told a newspaper reporter that although Ikea had already cut 5,000 employees, more reductions would be necessary.

“It is naturally a disappointment, but it will unfortunately not be enough. It will be necessary to do significantly more on the staff side," he was quoted as saying in an interview with Swedish business daily Dagens Industri. "We need to cut staff more mainly within manufacturing and logistics. This is about adapting to sales being far below budget as well as becoming more efficient."

Kamprad said Ikea would be hiring thousands of employees per year across the world in coming years to staff new stores, although he added the company was scaling back on its growth plans.

"The forecast shows the margin and earnings falling considerably this year. That is proof that we've been too lax in dealing with our existing stores," he was quoted as saying. "I've actually tried to warn for some time that we've had too much focus on expansion and now the board has chosen reduce the pace of new establishments significantly."