Furniture retailer IKEA opened its first store in South Korea on 18 December, as it looks to capitalise on increasing household demands among the country's urban population.
The 131,550 square-metre outlet in the city of Gwangmyeong is the Swedish company's biggest as of now, and beats its 55,200-square-metre store in Stockholm.
Global retail giants such as Wal-Mart and Carrefour exited the country in 2006 due to tough domestic competition and sluggish spending by consumers. However, IKEA is expected to become strong in the country due to its design appeal to the urban population and less local competition, according to experts.
"Korea has a population structure that fits IKEA's basic growth DNA - demand from design-conscious one-person and two-people households," Reuters quoted Suh Yong-gu, professor of marketing at Sookmyung Women's University, as saying.
South Korea has one of the fastest-aging populations in the world, and foreign general retailers found it difficult to attract spending from them. Private spending growth declined to 1.9% year-on-year in 2013 from 4.4% in 2010.
IKEA, which is known for its inexpensive, self-assembly products, is specifically targeting Korea's one-person households, which are expected to increase to 34.3% of the total by 2035 from 25.3% in 2012.
The company expects to open five outlets in the country by 2020. It is currently operating 365 stores in 43 countries across the globe.