Ikea may develop smaller stores in Britain to abide by planning laws

FURNITURE giant Ikea, whose large-store format was behind the Government’s controversial move to scrap retail planning guidelines, is considering the development of smaller stores in Britain to meet planning laws there, it was reported at the weekend.

The company is believed to be rethinking its strategy of rolling out giant stores to avoid falling foul of British government policy on retailing. The company has 12 stores in Britain, but was understood to have dragged its heels on entering the Irish market until laws were changed here to cater for its 30,000 square metre preferred format.

Environment Minister Dick Roche came under fire from Irish retailers earlier this month after he was perceived as climbing down in response to Ikea pressure.The Government’s change to planning policy paved the way for Ikea to open its first Irish outlet in the disadvantaged north Dublin suburb of Ballymun.

Mr Roche said at the time that the move aimed to improve competition in the furniture retailing market. But lobby groups representing DIY retailers, small businesses and independent grocers claimed his decision showed that Irish law could be changed to suit mulitnational retailers that wanted to do business here.

The Irish Hardware and Building Materials Association (IHBMA), which represents 600 hardware stores, said Mr Roche had made “a farce” of national planning policy, while grocers’ group RGDATA said the move seemed to be “solely devised to suit the operating preferences of an international retailer that did not like Irish planning laws.”

An Ikea spokesperson told a British news agency the firm’s stores in Britain were under “enormous” pressure thanks to runaway customer demand and that it wanted to build more stores. The company is appealing a decision by the British government that threw out plans for a 28,000 square metre store near Stockport. But it was prepared to consider building smaller stores if there was sustained opposition to the traditional format, the spokesperson was quoted as saying.