Success Story Of Ingvar Kamprad, Founder of IKEA
Introduction
Have you ever wandered through an IKEA store, marveling at the clever furniture designs and affordable prices? Behind this global furniture empire stands a fascinating man with humble beginnings. Ingvar Kamprad started with almost nothing but built one of the world’s largest companies. His journey shows us how big dreams, hard work, and smart thinking can create amazing results.
Let me share with you the remarkable story of a farm boy who became one of the world’s richest people—not through inheritance or luck, but through determination and a unique business vision. His story contains valuable lessons for anyone with entrepreneurial dreams.
Early Life and Origins
Born on March 30, 1926, in Småland, Sweden, Ingvar Kamprad grew up on a farm called Elmtaryd near the small village of Agunnaryd. This rural childhood shaped his character in profound ways. Sweden’s Småland region was known for its rocky terrain and poor soil, not an easy place to farm. People from this area gained a reputation for being hardworking and resourceful, making the most of limited resources.
Young Ingvar showed entrepreneurial flair early. At just five years old, he began selling matches to neighbors. By age seven, he expanded his business by buying matches in bulk from Stockholm and selling them individually at a profit. His business sense grew as he added more products—pens, pencils, seeds, greeting cards, and even Christmas decorations.
An interesting fact: Kamprad had dyslexia, which made traditional schooling challenging. However, this condition may have helped him develop alternative thinking patterns that later contributed to his unique business approach.
Birth of IKEA
In 1943, at just 17 years old, Kamprad founded IKEA with a small reward his father gave him for good grades. The name IKEA comes from his initials (I.K.) plus the first letters of Elmtaryd and Agunnaryd, the farm and village where he grew up.
IKEA initially sold pens, wallets, picture frames, table runners, watches, jewelry, and nylon stockings—basically anything that could turn a profit. It wasn’t until 1948 that furniture entered the picture, and the company began its journey toward becoming a furniture specialist.
A key moment came in 1956 when IKEA introduced the concept of flat-pack furniture. The story goes that an employee removed the legs from a table to fit it in a car, sparking the idea. This innovation solved a major problem: shipping furniture was expensive and items often arrived damaged. Flat packing made shipping cheaper and safer.
| Year | IKEA Milestone |
|---|---|
| 1943 | Founded as mail-order business |
| 1948 | First furniture products introduced |
| 1951 | First IKEA catalog published |
| 1956 | Introduction of flat-pack furniture |
| 1958 | First IKEA store opened in Älmhult, Sweden |
| 1963 | First store outside Sweden (Norway) |
| 1974 | Expansion to Germany |
| 1985 | First US store opened |
| 2018 | Kamprad passes away |
Business Philosophy and Innovation
Kamprad built IKEA on a simple philosophy: “To create a better everyday life for the many people.” This meant offering well-designed furniture at prices so low that as many people as possible could afford them.
Several key innovations helped make this vision real:
Customer Involvement: By letting customers assemble their furniture, IKEA reduced labor costs and final prices.
Showroom Concept: IKEA stores display furniture in realistic room settings, helping customers visualize products in their homes.
Vertical Integration: From design to retail, IKEA controls the entire process, eliminating middlemen and reducing costs.
Democratic Design: IKEA products balance form, function, quality, sustainability, and low price—what they call “democratic design.”
Kamprad had a unique approach to product development. He often said, “You can’t improve a price by 10%, but you can improve a design by 10%.” This focus on continual improvement helped IKEA maintain its edge.
Leadership Style
Kamprad’s leadership approach mixed simplicity with high expectations. Despite his enormous wealth (estimated at $58.7 billion at the time of his death, according to research by Swedish business magazine Veckans Affärer), he lived modestly and expected IKEA employees to do the same.
He flew economy class, drove an old Volvo, and often used public transportation. When staying at hotels, he preferred budget options. This wasn’t just personal preference—it was part of a corporate culture Kamprad called “cost-consciousness.”
His leadership philosophy included:
Lead by Example: Kamprad didn’t just talk about frugality—he lived it.
Accessibility: Despite heading a global corporation, he maintained an open-door policy and visited stores regularly to stay connected with staff and customers.
Trust and Responsibility: He gave employees significant freedom to solve problems and make decisions.
Failure Tolerance: “Only while sleeping one makes no mistakes,” he famously said, encouraging innovation and risk-taking.
Challenges and Solutions
Kamprad’s journey wasn’t without obstacles. In the 1950s, Swedish furniture retailers, feeling threatened by IKEA’s low prices, pressured suppliers to boycott the company. Instead of giving up, Kamprad looked outside Sweden for manufacturers, beginning with Poland. This move not only solved the immediate problem but ultimately lowered costs further and became part of IKEA’s global sourcing strategy.
In the 1980s and 1990s, IKEA struggled when entering the American market. U.S. customers found beds too narrow, kitchen cabinets too shallow, and glasses too small. Rather than insisting on standard European sizes, Kamprad directed IKEA to adapt products for American preferences while maintaining its core design philosophy.
Another significant challenge came from Kamprad’s past. In the 1990s, his brief involvement with pro-Nazi groups in the 1940s became public. Kamprad addressed this openly, calling it his “greatest mistake” and describing it as youthful folly. He sent a letter of apology to all IKEA employees and maintained transparency about this mistake.
Global Expansion
From a small mail-order business in rural Sweden, IKEA grew into a global phenomenon with stores in over 60 countries. This expansion didn’t happen overnight but followed a careful strategy.
Kamprad preferred organic growth over rapid expansion. Each new market entry followed extensive research, and the company adapted its approach to local conditions while maintaining its core concepts. For example, IKEA adjusted room displays in China to reflect typical Chinese apartment sizes and living arrangements.
The blue and yellow stores became architectural landmarks in many cities, designed to offer the same customer experience worldwide while accommodating local needs.
By 2017, IKEA had:
- 403 stores worldwide
- 194,000 employees
- €38.3 billion in annual sales
Personal Life and Values
Despite his wealth, Kamprad maintained an almost legendary frugality. He often bought vegetables after hours when markets marked down prices. He saved paper by writing on both sides and reused tea bags. When moving to Switzerland in the 1970s (partly for tax reasons), he took the subway to work and furnished his modest home with IKEA furniture, some of which he assembled himself.
Family played a central role in his life. He married twice and had four children, three of whom have roles in the company. However, he set up a complex ownership structure that ensures no single family member could take control of IKEA.
His personal motto, “Most things remain to be done,” reflected his belief in continuous improvement and never being satisfied with current achievements.
Legacy and Impact
When Kamprad passed away on January 27, 2018, at age 91, he left behind more than just a furniture company. His impact extends to multiple areas:
Retail Revolution: IKEA fundamentally changed how furniture is sold, challenging traditional high-markup models.
Design Democratization: His vision put well-designed furniture within reach of average consumers, not just the wealthy.
Business Innovation: The flat-pack model influenced countless other businesses across industries.
Sustainable Practices: Under his guidance, IKEA became an early adopter of environmentally responsible practices, using renewable materials and energy-efficient solutions.
Corporate Structure: The IKEA Foundation and ownership structure he created ensures the company maintains its vision far into the future.
Lessons for Entrepreneurs
Kamprad’s success offers valuable insights for today’s business builders:
Start Small, Think Big: He began with matches sold to neighbors but always had bigger ambitions.
Solve Real Problems: Flat-pack furniture addressed genuine customer pain points around cost and transportation.
Build Around Values: IKEA’s clear mission guided decisions at every level.
Embrace Obstacles as Opportunities: When Swedish suppliers boycotted IKEA, Kamprad found international sources that ultimately strengthened the company.
Cost Isn’t Everything, But It Matters: While focusing on affordable prices, IKEA never compromised on design and functionality.
Stay Close to Customers: Kamprad regularly visited stores to talk with both customers and employees.
Create Systems That Outlast You: IKEA’s ownership structure ensures its mission continues beyond its founder.
Perhaps most importantly, Kamprad showed that success doesn’t require changing who you are. He remained true to his rural Swedish values throughout his life, proving that authenticity and business success can go hand in hand.
TL;DR
Ingvar Kamprad transformed from a farm boy with dyslexia into one of the world’s wealthiest individuals by founding IKEA. His success stemmed from innovations like flat-pack furniture, showroom displays, and customer self-assembly.
Despite his wealth, he lived frugally and created a company culture of cost-consciousness. Kamprad overcame significant challenges, including supplier boycotts and market adaptation issues, through resourceful problem-solving.
His legacy extends beyond retail to include democratic design principles, sustainable business practices, and a unique corporate structure ensuring IKEA’s mission continues. For entrepreneurs, his journey demonstrates the power of starting small with big visions, solving real customer problems, building businesses around clear values, and creating systems that outlast their founders.
Q&A
Q: Why did Kamprad name his company IKEA? A: IKEA is an acronym formed from his initials (Ingvar Kamprad), plus the first letters of Elmtaryd (the farm where he grew up) and Agunnaryd (his hometown village).
Q: What was Kamprad’s biggest innovation? A: While flat-pack furniture is often cited as his biggest innovation, his most profound contribution may be democratizing good design—making well-designed, functional furniture affordable for ordinary people.
Q: Did Kamprad really live as frugally as stories suggest? A: Yes, despite his enormous wealth, Kamprad was famously frugal. He flew economy class, drove older vehicles, stayed in budget hotels, and even took home packets of salt and pepper from restaurants.
Q: How did IKEA maintain low prices while ensuring quality? A: Through several approaches: designing products specifically for efficient manufacturing, buying raw materials in bulk, using global sourcing to find cost-effective production, eliminating middlemen, and involving customers in assembly.
Q: What was the biggest challenge IKEA faced under Kamprad’s leadership? A: Perhaps the most significant challenge was when Swedish furniture manufacturers boycotted IKEA in the 1950s. This forced Kamprad to look outside Sweden for suppliers, ultimately strengthening the company by establishing its global supply chain.
Quiz: Are You Following Kamprad’s Business Principles?
- Do you actively look for ways to reduce costs without sacrificing quality?
- Yes: +2 points
- Sometimes: +1 point
- No: 0 points
- When facing obstacles, do you see them as opportunities for innovation?
- Yes: +2 points
- Sometimes: +1 point
- No: 0 points
- Do you maintain a clear vision that guides all your business decisions?
- Yes: +2 points
- Sometimes: +1 point
- No: 0 points
- Are you willing to challenge industry conventions to better serve customers?
- Yes: +2 points
- Sometimes: +1 point
- No: 0 points
- Do you regularly connect directly with customers to understand their needs?
- Yes: +2 points
- Sometimes: +1 point
- No: 0 points
Scoring Interpretation:
- 8-10 points: You’re applying Kamprad’s principles like a natural! Your business mindset aligns well with the practices that built IKEA into a global powerhouse.
- 5-7 points: You’ve adopted some key elements of Kamprad’s approach but could benefit from more consistently applying his principles.
- 0-4 points: Consider incorporating more of Kamprad’s business philosophy into your approach. Focus particularly on cost-consciousness, innovation, and customer connection.
