The other day I read Nathan Holmquist’s newsletter where he talked about his latest FBA victories at, of all places, IKEA. I was dumbfounded. Why hadn’t I thought of that? I LOVE IKEA in a weird psycho-fan kind of way. I have personally been to the opening day of four IKEAs as they expanded into the US. I ran through the gauntlet of screaming Swedes to grab those opening day specials. They have special “beaters” that make it even louder and more exciting when you enter. Do you see the crazed woman in the picture? That’s me, basically, only I wore a tee-shirt, it’s hotter in Texas. I’ve spent days of my life in IKEA wandering the aisles. I gushed over the showrooms. I ate the meatballs (before I went vegetarian). I know all the secret passages and all the sections like I designed them myself. I’ve shopped IKEA on two continents. IKEA is the number one furniture retailer in the world (yep, it came to the US late in its world conquest. It is more than 60 years old).
So how come I didn’t think about IKEA for FBA? Well, partly because it is a store that exclusively sells its own brand. I know they have an online site and I just assumed that you couldn’t buy IKEA on Amazon. I also erroneously thought that no one would want to pay premium prices on something that was so cheap in the store. Boy was I wrong! So keep that in mind when you are scouting. Everything is a possibility to sell on Amazon. The second thought was really just dumb because I buy cheap stuff in stores like Target, Walmart and BigLots and sell it for a premium all the time on Amazon, but IKEA is so well known for its low prices…well, I was just wrong.
Naturally with an excuse to shop at IKEA, I had to go. My friend Denny Gaye and I arrived at 10 and left at 4 tired but triumphant. Here’s what I learned in a nutshell:
There are no barcodes – you have to type everything into Scan Power Scout or whatever you are using to scout. Their barcodes are unique to IKEA so you have to use product names to search. I used the phrase “IKEA + insert weird Swede name” to look it up on Amazon. This slows down the process, obviously and you have to be picky about what you investigate. It went faster with the two of us dividing and conquering.
Make sure to check the size – I fell in love with a particular lamp. The margin was great, I was all over it. When I went to actually pick up the lamp, I realized there were two sizes of pendant lamp (hanging lamps) and two prices, naturally. I had to surf through the Amazon listing to figure out that the price was actually for the bigger, more expensive lamp. Now all of a sudden the margin was lousy. It was depressing but it made me more cautious for the rest of the trip to make sure I was truly looking at the right listing on Amazon.
Not everything has a rank – I noticed that many of the products didn’t have a rank yet. This could be because they were so newly added to the catalog that they’ve not sold yet. For new sellers, I recommend buying products with rank because you can be sure that they have sold before. However, if you are willing to take the risk, go ahead and list your stuff without it. I saw a LOT of merchant sellers and I think that was their strategy. If it doesn’t sell, it is easy to return since it is in their house. I have no room in my house so that strategy doesn’t work for me.
Not everything has a seller – This was interesting, too. We saw products without any sellers and I can only conclude that they were out – all products had sold – or the merchant sellers had returned their items. If I saw no rank and no sellers, I usually put it back down. If I saw rank but no sellers, I looked more closely.
Not everything is for sale – There are scads of IKEA products not for sale on Amazon. If you think they should be and are willing to add new items to the Amazon catalog, go for it. I didn’t do that this time, but I might in the future. There were several things I thought should be for sale on Amazon and that would be popular.
There are some stupid prices out there – All I can guess is that most of the FBA sellers with IKEA product don’t have Scan Power because I saw some of the dumbest prices ever. People were spending $40 to make $10 after Amazon’s fees. I knew from reading Nathan’s newsletter that he was able to sell and make a juicy margin so I could only conclude that these low-ball sellers were not aware of how much Amazon’s fees would actually be. While IKEA packs things into nice flat boxes, the fact is some of them are still way oversized and the fees can be a lot. I put down some items for that reason. Amazon’s fees were so high, it just didn’t make sense. I saw a gorgeous $49 lamp I wanted to sell for $200 but everyone else was selling it around $100. It didn’t make sense. The oversize fees were nearly $50. Because there were so many lowball sellers, I decided to wait until my next trip to check it out again. I looked at lingonberry jam and other specialty foods and I have no idea why the prices were so low on Amazon. It didn’t make sense to spend $4 and clear $1 after expenses. Where the heck does anyone buy lingonberries in the US? I’ll check again when I go back to see if the crazy sellers are gone.
Eat lunch – the place is massive. You’ll get tired. Have lunch. This place takes stamina. Wear comfortable shoes, too.
Think about the buyer – who buys IKEA on Amazon? My guess is someone who is far away from an IKEA but who is familiar with their merchandise; someone who is super busy and doesn’t want to lose a day in IKEA Wonderland; someone who hates to shop but loves Allen wrench projects; a designer or someone else who appreciates modern design in a big way. All of the above. Kind of like Amazon Prime buyers, people who shop at IKEA really love it. It has a cult following (note the Screaming Swede story – there were well over 1000 people standing in line with me that morning). Your buyer is a fan and fans want what they want. Remember that.
What can they only buy from IKEA? – Again, you don’t want to sell something simple like a black picture frame that they can get anywhere. You want something that can only be bought at IKEA and that is cool and desirable. I looked at bedding, pillows, curtains, lamps, rugs, toys, small furniture, shelving and certain chairs. IKEA’s wonderful graphics, cool design, kitchen wonders and unique chic are apparent in these items. If you find yourself saying “that is so cool!” then it is probably a sellable item.
Why would they buy from you? – As I mentioned, IKEA sells online, too. However, their shipping costs are really high and it can take three weeks or more to get your stuff when you buy online from them. Amazon offers Prime buyers free 2-day shipping or overnight for a little bit more. It’s no contest. Prime buyers are 1) more affluent and 2) impatient. In addition, IKEAs are not ubiquitous like a Target or Walmart. They very carefully select their sites based on a certain population level. While there are three IKEAs in the New York tri-state metropolitan area for example, there are only three IKEAs in all of Texas (DFW, Houston & Austin area).
Join the Club – IKEA has a new club called IKEA FAMILY. You’ll see low prices throughout the store that are only available to club members. You can join at the kiosk near check-out and use your card immediately. It is worth it. I saved almost $60 right off the bat. Naturally, they will market to you relentlessly for life, but you want to know when their sales are, right? J You also get a free coffee or tea in the café every time you visit to take the sting out of it. They send you monthly deals that are exclusive to club members and the discounts can be substantial. They also offer you 90-day price protection if you are member. If your item goes down in price in the next 90 days, you can get the difference.
Shop Ahead of Time – Once you are a member of the club, you can login and shop the monthly deals before you go to the store. Since you have to enter them into Scan Power by name no matter what, might as well do that at home with your high-speed internet and save your feet. You can look at all the IKEA inventory on Amazon simply by keying in “IKEA” in the search bar and then you can sort by category.
Note the tags – if you are not used to shopping at IKEA, you need to understand that you pick up a lot of the items from the top floor in the warehouse section of the bottom floor. If you find a coffee table or something that works out, take a picture of the red tag or write down where to find it in the warehouse downstairs. It will save you time later.
Use Scan Power Scout’s “Buy” Button – In addition, if I find something I want, I push the “Buy” button on Scan Power Scout. This way I don’t have to search for the product again later when I want to list the products and process my inventory. I can simply choose “send” from Scan Power Scout and it will appear in my Scan Power desktop listing program all ready for me to add prices and print labels.
Get a flatbed – Again, if you are not familiar with the store, when you get to the warehouse section, they will have flatbed carts for you on your immediate left. Be sure to grab one. It is much easier to put your boxes on a flatbed than to try and cram them into a cart.
No price tags, no extra packaging – Most items are nicely packed in a compact box perfect for sending to Amazon’s warehouse. There are no stickers to remove and the boxes are well-packed and durable enough for Amazon’s warehouse. A nice plus. Be sure to cover IKEA’s barcodes or anything that looks like a barcode.
Discounts for cash, checks or debit – I don’t know if this is everywhere like the new Club, but IKEA offers small discounts if you use cash, checks or debit and sometimes they’ll also give you a discount on your next purchase if you do this. In my case the other day, I used my debit card as credit for the extra buyer’s protection in gives me so I didn’t get that particular benefit.
Know what sells – If you are a long-time IKEA fan like me, you’ll know there are certain chairs, tables, toys, kids accessories, etc. that have been there forever. Why is this? Because they are IKEA’s best sellers! Poäng chairs will never die! These are items that out-of-towners might well crave. Obviously if you are new, you’ll just have to go instinct. Even so, anything that you see year after year in the catalog should make you think. You are getting the catalog aren’t you? You will after you sign up for the Club, but you can also get one for free at the customer service section near check-out. Anything that doesn’t say “New!” is probably a steady-eddy seller. Anything not in a fad color is probably a steady-eddy.
Get a map – The place is enormous. You can get a map as you come in that will tell you important things like where to find the bathrooms and café, and where to find the secret passages that allow you to cut through sections quickly to get to check-out.
Bring a friend – I was glad I had Denny Gaye with me. Not only was it more fun, we were able to help each other grab boxes, push our three carts, investigate more items together and we had a nice lunch. If I were to describe IKEA in a few words, it would be “furniture amusement park.” It is fun, entertaining, exhausting and there are often long lines at check out. Bring a friend if you can.
Mobile apps – for you techno-weenies (you know who you are) the free IKEA iPhone and Android apps show about 1000 out of the 10,000 products in the IKEA catalog. This is IKEA’s way of telling you what its most popular products are.
Shopping list – You can browse online and IKEA will create a printable shopping list for you to bring with you to the store – very nice. A related online service lets you check availability of items before you go. Want more of those great lamps? Make sure they are in stock before you drive a long way for nothing.
No bags – IKEA will happily sell you a shopping bag but they don’t offer any at check out. Either bring your own, pay 59 cents for one of theirs (they are very big and blue) or struggle without one for your smaller items.
Babysitting at Småland – they have a special area where you can drop off your kids with professional daycare people. I don’t know how much they charge. It is very cute. If you are forced to bring your small fry with you, this provides you with some peace while scouting. Leave them at home if you can. IKEA is BIG and super boring for the kids. They put toys and play areas in each section, but still.
Results – It has been a couple of weeks since I got my IKEA order in and so far it has been very interesting and encouraging. Certain items sold very quickly and I’m going back to get more. I bought some $2 kitchen items I’m selling for $12+ and they are flying out of the warehouse. Some of the toys and lamps I bought haven’t sold yet, but I’m not worried: I’m waiting for some low-ball sellers to clear the decks. I might even buy their products and resell them. By the way, I did not buy the Poäng chairs this time around. They are big with higher fees and the margin wasn’t there with the FBA competition I saw. I’ll check again later.
What about you? Have you scouted IKEA before? Are there other stores that you’ve not thought of scouting before that you might scout now? Please share in the comments below!