IKEA Opening New Smaller Format Store in San Francisco

[ClownLoach]

There is an Ikea just across the bridge from San Francisco in Emeryville, California with a huge free parking garage. There is no way I am driving into San Francisco to shop at the little IKEA.

The IKEA in San Francisco is mostly for people who live in San Francisco. These are rich tech workers, upper middle class people who live in million dollar homes, millionaires who live in million dollar condos, etc. The rich will shop at the little IKEA and take an Uber or limo. The people who don't want to pay for parking will drive the extra 15 minutes to Emeryville.

The IKEA in Emeryville is overflowing with customers. The San Francisco IKEA is doing its job at reducing the wall to wall crowds at the Emeryville store. This will in turn lead to more customers since many people avoided Emeryville since there were so many crowds.

Emeryville will always appeal to those with cars, and San Francisco will appeal to those who don't care about parking.

First, the rich don't shop Ikea.

Second, I don't see how this mini store could reduce the traffic at a regular store because it lacks all the merchandise that causes the crowds. This is just a showroom. The marketplace at a regular Ikea attracts repeat business selling consumables like the famous tealight candle packs; this store lacks that endless maze of those home accessories like a super sized Walmart or Costco. So nobody is choosing this SF site as an alternative to the full size store; that isn't even what Ikea intends these mini stores to do. They are intended to introduce new customers to the brand and entice them to visit the larger store someday. If this store works as intended then the Emeryville store should be busier now than it was before.

Last, parking is a definite problem but it is not the entire reason all reports indicate this store is a ghost town. The fact is the store is too big for what it's supposed to be, a simple showroom with a few furniture and kitchen design centers. And it's also too small to meet the expectations of the customer who knows what Ikea is supposed to be, a place full of home stuff cheap where you can't avoid filling a cart with dozens of bargain items. It lacks that entire department from what I've seen, just a few random selected SKUs of pots and pans, plates, curtains, etc. They needed to open something 90% smaller... Just like these urban locations everyone is speaking of all around the world. What everyone is getting wrong is that the typical urban small International Ikea showroom is about 5,000 Sq ft... Even the US ones like the new Long Beach, CA one. This SF store is over 50,000 Sq ft. It's too big to be small enough, and too small to be big enough. It's a mistake that likely will be corrected with a closure.

[storewanderer]

First, the rich don't shop Ikea.

Second, I don't see how this mini store could reduce the traffic at a regular store because it lacks all the merchandise that causes the crowds. This is just a showroom. The marketplace at a regular Ikea attracts repeat business selling consumables like the famous tealight candle packs; this store lacks that endless maze of those home accessories like a super sized Walmart or Costco. So nobody is choosing this SF site as an alternative to the full size store; that isn't even what Ikea intends these mini stores to do. They are intended to introduce new customers to the brand and entice them to visit the larger store someday. If this store works as intended then the Emeryville store should be busier now than it was before.

Last, parking is a definite problem but it is not the entire reason all reports indicate this store is a ghost town. The fact is the store is too big for what it's supposed to be, a simple showroom with a few furniture and kitchen design centers. And it's also too small to meet the expectations of the customer who knows what Ikea is supposed to be. They needed to open something 90% smaller... Just like these urban locations everyone is speaking of all around the world. What everyone is getting wrong is that the typical urban small International Ikea showroom is about 5,000 Sq ft... Even the US ones like the new Long Beach, CA one. This SF store is over 50,000 Sq ft. It's too big to be small enough, and too small to be big enough. It's a mistake that likely will be corrected with a closure.

Do you think this format could have performed better in a higher traffic area, say, near the larger Target at Metreon?

I see official Ikea Press Release has the store at 52,000 square feet, but various other San Francisco publications including the SF Chronicle have the store at 85,000 square feet. Did they scale it back?

Also they have one store manager for both this and the Emeryville Store... maybe somehow this works for them as like a satellite of the Emeryville Store.

[Alpha8472]

One store manager? They probably figure it will close soon anyway so why bother hiring another manager.

I read the reviews. It seems like it is a useless store if all the furniture is only avaliable to order online.

Perhaps if they expanded the store and added furniture by using the vacant space in the building. People want to buy furniture and other impulsive buys to take it home right away.

This seems like a really poorly planned mediocre store that just serves to alienate everyone by what it lacks. It tarnishes the IKEA brand.

[Romr123]

yeah, if they don't have grab-and-go decor (tealights/plants/dishware/pots and pans/pillows/linens----roughly comparable lines to a Marshalls/TJX/Home Goods--they probably will not do well...the store I referenced in Toronto certainly had that.

[ClownLoach]

yeah, if they don't have grab-and-go decor (tealights/plants/dishware/pots and pans/pillows/linens----roughly comparable lines to a Marshalls/TJX/Home Goods--they probably will not do well...the store I referenced in Toronto certainly had that.

Their website says Toronto displays 3500 SKUs, and over 2000 are in stock for immediate pickup. Based on all the reviews of this SF location it does not sound like anything close to 2000 are available for pickup there. If they did have them I could see this store working fine, as probably 2000 or so SKUs have packaging small enough that one could carry it out.

Parking in SF versus Toronto is vastly different because of the subway system. The BART and Muni systems in SF have a poor reputation for safety and efficiency, and generally are avoided by all who can afford a car. Toronto and other major Canadian cities have very efficient and cheap subway systems that are clean and very fast. They are a desirable form of transportation for everyone. All of our family in Canada have cars but they choose to use the Metro most of the time... Predictability is a big reason, say you have a dinner reservation for 6pm. You know for certain the train will drop you off at 5:45 on the dot a block from the restaurant, but you can't be so sure if you'll find parking or make it on time driving the car in traffic. (Plus if everyone takes the Metro then everyone can safely enjoy an alcoholic beverage if they so choose which is why you see so many more bars there versus typical US cities without a effective subway system). So I could see the Toronto downtown Ikea being very busy with subway riders who would happily carry their purchases onto the train ride home. I do not see the same interest with the SF customer especially due to the homelessness problem in the Muni system.

[ClownLoach]

First, the rich don't shop Ikea.

Second, I don't see how this mini store could reduce the traffic at a regular store because it lacks all the merchandise that causes the crowds. This is just a showroom. The marketplace at a regular Ikea attracts repeat business selling consumables like the famous tealight candle packs; this store lacks that endless maze of those home accessories like a super sized Walmart or Costco. So nobody is choosing this SF site as an alternative to the full size store; that isn't even what Ikea intends these mini stores to do. They are intended to introduce new customers to the brand and entice them to visit the larger store someday. If this store works as intended then the Emeryville store should be busier now than it was before.

Last, parking is a definite problem but it is not the entire reason all reports indicate this store is a ghost town. The fact is the store is too big for what it's supposed to be, a simple showroom with a few furniture and kitchen design centers. And it's also too small to meet the expectations of the customer who knows what Ikea is supposed to be. They needed to open something 90% smaller... Just like these urban locations everyone is speaking of all around the world. What everyone is getting wrong is that the typical urban small International Ikea showroom is about 5,000 Sq ft... Even the US ones like the new Long Beach, CA one. This SF store is over 50,000 Sq ft. It's too big to be small enough, and too small to be big enough. It's a mistake that likely will be corrected with a closure.

Do you think this format could have performed better in a higher traffic area, say, near the larger Target at Metreon?

I see official Ikea Press Release has the store at 52,000 square feet, but various other San Francisco publications including the SF Chronicle have the store at 85,000 square feet. Did they scale it back?

Also they have one store manager for both this and the Emeryville Store... maybe somehow this works for them as like a satellite of the Emeryville Store.

This is another problem. 85,000 Sq ft but the customer space is only 52,000. What do they need all that off sales floor space for? How many offices and other admin space does this store need? Clearly they need to bust out some of this and make it available for more grab and go merchandise.

I wonder if they decided to make it a satellite because they can't find enough help? Maybe they make Emeryville workers take shifts there, hence the one Store Manager? But I've heard the typical Ikea megastore is hard to run as it is... Can't imagine having to oversee another.

[storewanderer]

This is another problem. 85,000 Sq ft but the customer space is only 52,000. What do they need all that off sales floor space for? How many offices and other admin space does this store need? Clearly they need to bust out some of this and make it available for more grab and go merchandise.

I wonder if they decided to make it a satellite because they can't find enough help? Maybe they make Emeryville workers take shifts there, hence the one Store Manager? But I've heard the typical Ikea megastore is hard to run as it is... Can't imagine having to oversee another.

Knowing the location and knowing foot traffic I just think this location is a loser. The way the streets are laid out in that area, this has always been a low traffic block. There is a lot of foot traffic even within eyesight, but the area directly in front of the store just doesn't get much foot traffic due to how the roads are.

The other issue I see here is how the building is landlocked (not its own entire block) so the parking garage entry is at the back halfway down a block on a back street and it is a long-ish block. I suspect many customers do not even realize or know the store has its own parking.

I also see a lot of customer comments that the sign says parking $3 per 15 minutes but then lower on the sign it says $20 flat rate weekends. So yes, you go shop for 30 minutes on a Saturday and they nail you for $20 of parking... not $6. This is a PROBLEM. Ikea owns the building- they need to get control of this situation. Kick out the parking garage operator or do something so their customers are taken care of with parking ot at least go to that $3 per 15 minutes thing.

They supposedly plan a co-working space and various other things for the remainder of the 250,000 square foot building. We will see what they do. They need to do a lot to get traffic in this block and generate interest/life in a lifeless block that has always been lifeless.

[ClownLoach]

This is another problem. 85,000 Sq ft but the customer space is only 52,000. What do they need all that off sales floor space for? How many offices and other admin space does this store need? Clearly they need to bust out some of this and make it available for more grab and go merchandise.

I wonder if they decided to make it a satellite because they can't find enough help? Maybe they make Emeryville workers take shifts there, hence the one Store Manager? But I've heard the typical Ikea megastore is hard to run as it is... Can't imagine having to oversee another.

Knowing the location and knowing foot traffic I just think this location is a loser. The way the streets are laid out in that area, this has always been a low traffic block. There is a lot of foot traffic even within eyesight, but the area directly in front of the store just doesn't get much foot traffic due to how the roads are.

The other issue I see here is how the building is landlocked (not its own entire block) so the parking garage entry is at the back halfway down a block on a back street and it is a long-ish block. I suspect many customers do not even realize or know the store has its own parking.

I also see a lot of customer comments that the sign says parking $3 per 15 minutes but then lower on the sign it says $20 flat rate weekends. So yes, you go shop for 30 minutes on a Saturday and they nail you for $20 of parking... not $6. This is a PROBLEM. Ikea owns the building- they need to get control of this situation. Kick out the parking garage operator or do something so their customers are taken care of with parking ot at least go to that $3 per 15 minutes thing.

They supposedly plan a co-working space and various other things for the remainder of the 250,000 square foot building. We will see what they do. They need to do a lot to get traffic in this block and generate interest/life in a lifeless block that has always been lifeless.

Since Ikea owns and built it, makes me wonder if at some point they intended for this to be a full size store and then they decided to downsize?