Step by step, this price war affected the quality of the ironing board, which became simpler and simpler, but also worse and worse. The same applied to furniture. Complaints started to mount, and I could see how things were going: the mail-order trade was risking an increasingly bad reputation, and in the long run IKEA could not survive in that way. The core problem with mail order was that the customers themselves could not touch the goods but had to rely on descriptions in the advertisement or catalog. Consumer protection was poorly developed, and it was easy to cheat.
We were faced with a momentous decision: to allow IKEA to die or to find a new way of maintaining the trust of the customer and still make money.
Out of long talks through the night with Sven Göte about how we were to get out of this vicious circle – lower price, worse quality – the idea grew of trying a permanent display or exhibition of our furniture. People could go to the display, see the furniture for themselves, and compare the quality at different price levels.
In the middle of all this, Albin Lagerblad's joinery in Älmhult was to close. For what I thought was the tremendous sum of 13,000 kronor ($1,625), I bought the entire shabby building. Compared with that price, a modern department store today can cost up to a quarter of a billion kronor. The decision was logical.
In the spring of 1952, Ikea News came out in its last edition distributed as a supplement, and we had a sale of our entire stock of minor wares. We informed our customers that in the future we would sell only furniture and domestic articles. Using a form on the back of the brochure, people could order the first real furniture catalog. That was how I became a furniture dealer.
In the autumn of 1952, we completed the catalog, which came out in time for the opening of the furniture exhibition on March 18, 1953. The main item was an armchair called MK. I still have it in the parlor on the farm outside Älmhult. We had cleared out all the rubbish at Lagerblad's, scraped off all the old lime, put in new windows, and nailed masonite boards to the walls. We then displayed our furniture on two levels. We could now at last show those cheap ironing boards alongside those that cost five kronor more and were of good quality. And people did just what we had hoped: they wisely chose the more expensive ironing board.
At that moment, the basis of the modern IKEA concept was created, and in principle it still applies first and foremost, use a catalog to tempt people to come to an exhibition, which today is our store. "Come and see us in Älmhult and convince yourself that..." we wrote on the back of the first catalog.
Second, we provided a large building in which, catalog in hand, customers could walk around and see simple interiors for themselves, touch the furniture they wanted to buy, and then write out an order, which would be put into effect by mail via the factories.
Mail order and furniture store in one. As far as I knew, that business idea had not been put into practice anywhere else. We were the first. It was actually the invention of both Sven Göte and myself.
Success was immediate, and it created the embryo and resources for the store we created five years later. But I have never been so scared in my whole life as when we opened and I saw the line outside Lagerblad's: there were at least one thousand people there. I couldn't believe my eyes. On the upper floor of the factory, we had arranged coffee and buns alongside the furniture, and we didn't know whether the floor would hold or-even more important - whether we would be able to supply enough buns. That was precarious, as we had promised coffee and buns to those who came to the opening…
See Ingvar Kamprad's leader profile
From: Leading By Design: The Ikea Story, Ingvar Kamprad, Bertil Torekul
