Inter IKEA systems B.V ДОБРЕ ДОШЛИ VÄLKOMMEN WELCOME , Sofia, Bulgaria

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1 Inter IKEA systems B.V ДОБРЕ ДОШЛИ VÄLKOMMEN WELCOME , Sofia, Bulgaria

2 Inter IKEA Systems B.V What will we share today? Purchasing Operations area South East Europe Taskforce Bulgaria project Doing Business with IKEA Start up a supplier general information IWAY standard and Code of Conduct Quality in focus in everything we do Forestry and Better Cotton Supplier classification

3 Inter IKEA Systems B.V Moldova Romania Serbia Bosnia Bulgaria Macedonia Greece Turkey Turkmenistan Egypt 120 home furnishing suppliers in more than 11 countries 162 people working in Purchasing 3 offices 36 average age aprox 10% from total IKEA Purchasing What means Purchasing SEE?

4 Purchasing SEE in IKEA Purchasing Out of 7 CAs 5 are present in SEE Out of 34 Categories 15 have business teams located in SEE ~ 44 people working in Purchasing SEE ~ 80 people working in business teams

5 Some products made in SEE Inter IKEA Systems B.V. 2015

6 Taskforce Bulgaria

7 H i s t o r y IKEA is sourcing products in Bulgaria from the 70s Business started with wood articles, mainly pine Historically Bulgaria was strong in Wood, Metal, Glass, Ceramic Inter IKEA Systems B.V. 2015

8 IKEA has a growth agenda & defined a long term strategy to double the business until 2020 IKEA would like to expand also the supplier base and continue to develop together with the existing ones, products with good quality, low price, sustainable and available Inter IKEA Systems B.V. 2015

9 Bulgaria- Balkan FY15 Inter IKEA Systems B.V January 2015 we got a task to exploit further the business possibilities in Bulgaria Main goals: Develop and continue the growth with the existing suppliers Industry mapping in Bulgaria Select the right new partners/suppliers for IKEA From 3 rd of May - 9 th of May 2015 Ingvar Kamprad together with IKEA purchasing people and designers met existing IKEA suppliers and potential new ones End of an inspiring week full of energy, good discussions, nice moments and a lot of learning

10 Some pictures from the visit Bulgaria- Balkan FY15 Inter IKEA Systems B.V. 2015

11 Some pictures from the visit Bulgaria- Balkan FY15 Inter IKEA Systems B.V. 2014

12 Some projects on going Inter IKEA Systems B.V. 2015

13 Some projects on going Inter IKEA Systems B.V. 2015

14 Overall summary from the project Inter IKEA Systems B.V Updates Bulgaria Task force wk 19 9 Potential new suppliers in pipeline 2 solid wood 1 layer glued 1 combined materials metal, plastic, wood, solid wood 1 Flat line 1 Wool carpets and blankets 1 Mattress and bed base 2 Aluminum 51 New articles started or under development from May 2015 until now. Expected Turnover MEUR

15 Next steps Develop and Continue the growth with the existing partners Industry mapping in Bulgaria Select the right new partners/ suppliers for IKEA Continue and finish the projects already started Inter IKEA Systems B.V. 2015

16 Inter IKEA Systems B.V DOING BUSINESS WITH IKEA

17 A little about us Where we come from Inter IKEA Systems B.V The IKEA Concept was born in southern Sweden, in the barren landscape of Småland. Our values of e.g. togetherness, humbleness and thriftiness grew out from this background. IKEA values: Ten key expressions summarizing the IKEA culture Leadership by example Simplicity Striving to meet reality Constantly being on the way Cost-consciousness Constant desire for renewal Humbleness and willpower Daring to be different Togetherness and enthusiasm Accept and delegate responsibility IKEA Supply AG 2012

18 A little about us 1. IKEA BUSINESS MODEL Bringing suppliers and customers closer The need of our customers Inter IKEA Systems B.V The possibilities at our suppliers IKEA Supply AG 2012

19 Creating the low price in practice Creating the low price in practice Inter IKEA Systems B.V by work in the reality of our customers and suppliers at the same time. Focus on customers Focus on suppliers IKEA Supply AG 2012

20 Customers Inter IKEA Systems B.V Suppliers IKEA Our suppliers and customers are our best friends. The IKEA Concept is there to shorten the distance between them. IKEA founder, Ingvar Kamprad

21 What can you as a supplier expect of IKEA? Become global industry leader through low costs and big volumes Inter IKEA Systems B.V Profit and growth from volume and by growing IKEA together. Become global industry leader Our constant desire to reach more IKEA customers with better products at lower prices drives development, and the growing volumes becomes our enabler to develop. Knowledge transfer IKEA provides knowledge about the customers, life at home and the product. We can also offer industry reference, ideas and knowledge on how to improve production. IKEA Supply AG 2012

22 A little about us Everyday performance Inter IKEA Systems B.V Everyday product quality: well-designed, functional, customer-friendly, durable and safe to use High social & environmental responsibility, a foundation for our business Products always available, a prerequisite for sales We reduce cost to ensure affordable products for the many people We develop these qualities in synergy.

23 What can you as a supplier expect of IKEA? In partnership, suppliers can expect IKEA: to buy big volumes to be reliable, purchasing commitment to offer long-term business cooperation and orders to pay on time (30 days) to adapt our products to production to contribute to efficient production to care for the environment to support material- and energy saving techniques to take a clear standpoint on working conditions to respect different cultures to have clear and mutually agreed commercial terms growth Inter IKEA Systems B.V IKEA Supply AG 2012

24 What does IKEA expect of you as a supplier? Partners for growth Inter IKEA Systems B.V Shared business model and values Low costs & big volumes Everyday performance Everyday development High Quality Standard High Social & Env. Standard High Availability High efficiency, production competence and product competence Ability to grow Growth IKEA Supply AG 2012

25 Our range. Our identity. 26 IKEA Supply AG 2012

26 Our range. Our identity. Inter IKEA Systems B.V IWAY standard and Code of Conduct - Quality Compliance Standard (GO/NOGO) - Forestry - Supplier Classification IKEA Supply AG 2012

27 What does IKEA expect of you as a supplier? Sustainability Inter IKEA Systems B.V IKEA Supply AG 2012

28 The IKEA IWAYstandard Minimum Requirements for Environment, Social & Working Conditions when Purchasing Products, Materials and Services. In the best interest of. the child the worker the environment Version 1.2

29 Inter IKEA Systems B.V. 2015

30 Version 1.2 IWAY Implementation

31 Forestry We have strong and clear forestry requirements and make sure that 100% of the wood we use meets these standards. We support the Forest Stewardship Council (FSC), and we have helped to certify over 35 million hectares of forest, which is about the size of Italy. Our goal is to have all wood come from sustainable sources (FSC or recycled) by 2020.

32 Forestry For our region 100% FSC is a must from 1 Sep Version 1.2

33 Better Cotton Our cotton is grown in line with the standards of the Better Cotton Initiative, benefiting farmers and the environment. So far, we ve worked with over 110,000 farmers to reduce the amount of chemicals required, helping reduce pollution and strengthening local economies Version 1.2

34 Inter IKEA Systems B.V Quality Compliance Standard Package (GO/NOGO)

35 Throw-away products are not IKEA. Whatever the Customer purchases shall give long-term enjoyment. Inter IKEA Systems B.V Ingvar Kamprad The Testament of a Furniture Dealer

36 The IKEA products shall always Inter IKEA Systems B.V be in compliance with all relevant legal requirements and market regulations; be safe to use and not present any foreseeable health and safety risks; have clearly defined, implemented and verified product requirements; be durable, functional, customer friendly, well designed and produced in a sustainable way, resulting in well finished products. The low price is only meaningful when the above characteristics meet and exceed customer needs and expectations.

37 The Quality Compliance Standard (GO/NOGO) Inter IKEA Systems B.V It s a Compliance Standard It s legal agreement Must be always fulfilled Requirements audited every 2 years 5 sharp requirements: Product documentation, Connect system, Special processes process control, Final inspection, Identification and separation of non-conforming goods

38 Supplier Classification 39

39 Supplier Classification Inter IKEA Systems B.V IKEA Prioritized Supplier (P) IKEA Potential prioritized Supplier (T) IKEA Critical Supplier (C) IKEA Supplier (S) IKEA Product development/ Innovation Supplier (I)

40 Customer in focus in everything we do! IKEA suppliers our partners for growth

41 Thank you! Inter IKEA Systems B.V. 2015

42 Any questions?

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