The Ikea empire thrives on simple values of its founder, but it may be too dependent on him
Ingvar Kamprad is no ordinary multi-billionaire. The founder of the Ikea furniture empire travels economy class, drives a 10-year old Volvo and buys his fruit and vegetables in the afternoons, when prices are often cheaper.
Ask him about the luxuries in his life and he says: "From time to time, I like to buy a nice shirt and cravat - and eat Swedish fish roe."
Mr Kamprad is one of Europe's greatest post-war entrepreneurs. What began as a mail-order business in 1943 has grown into an international retailing phenomenon spanning 31 countries, with 70,000 employees.
Sales have risen every year. The Ikea catalogue is the world's biggest annual print run - a staggering 110 million copies a year. And Mr Kamprad has grown extraordinarily rich. At 76, he is worth $13.4 billion (€13.7 billion) and is the 17th richest person in the world, according to Forbes, the US magazine.
The Ikea Group has 154 stores in 22 countries. Including franchises, there are 175 in 31 countries. Yet the potential for growth is still enormous. The group may have 20 per cent of the furniture market in Mr Kamprad's native Sweden. But in Russia and China, where it is just starting out, it has only a fraction of 1 per cent.
The concept behind its success is devastating simple: make affordable, well designed furniture available to the masses. And then there is Mr Kamprad himself - charismatic, self-deprecating, reclusive. It is his ideas and values that have penetrated Ikea to its core.
Best known for his thrift and his spartan lifestyle, he washes plastic cups to recycle them. Not all the tales about him are accurate, he insists. "They say that when I take a Coca-Cola from the mini-bar of my hotel, I go to the supermarket to replace it, rather than pay the hotel. It's not true."
His behaviour could appear mean but somehow Mr Kamprad manages to carry it off. He has made it part of the Ikea mythology and part of Ikea's covenant with its customers. Our low costs are your low prices, the group implies. And the image of Mr Kamprad carrying his own bags is at one with the Ikea customer who lugs his new shelf units home.
But the Ikea culture - or cult, even - is not just about low costs. Mr Kamprad tries to define it using the word "together". The idea is that it is not just the managers who are important but also the people who clean the dishes in the kitchens.
A man of the people, perhaps, but you have to wonder what really links someone worth $13.4 billion with those co-workers as Ikea employees are known - who wash the dishes and may earn as little as $10,000 a year.
His personal stamp on the company is not to be doubted, however. The word Ikea derives from a combination of Mr Kamprad's initials, the first letter of Elmtaryd, his family farm, and Agunnaryd, the village in Smaland (pronounced Smorland) in southern Sweden where he was born.
The invention of the flat-pack in 1956 was the big breakthrough: self-assembly was born. Two years later the first Ikea store opened in Almhult, also in Smaland and still the company's spiritual home.
Mr Kamprad talks of more than doubling Ikea's size over the next 10 years. Most of the growth will come in western markets. But he argues that the real need for Ikea products is in China and Russia - countries where people often live in cramped apartments and need to make the most of every square metre they have. It is a practical commitment to improve the lives of the less fortunate. "I am much more eager to open stores in Russia than in Germany or the UK," he says. Expansion into new markets has driven sales from €3.8 billion in 1994 to €10.4 billion for 2001. Profits are one of the things he will not discuss, however. "We must have some secrets," he says. "But it's a qualified guess that we have a rather good result."
The only official profit figures ever released by the company came out five years ago, when it had a pre-tax margin of 15.5 per cent for the year to August 1997.
Mr Kamprad has had both personal and business battles to contend with. He has fought against dyslexia and alcoholism and this year underwent an operation for prostate cancer.
Will the empire endure, as control of Ikea gradually moves to Mr Kamprad's three sons? Certainly that is what he intends - and the formidably complicated and opaque structure of his business has been partially designed with durability in mind. The last thing he wants is for the empire to be broken up or sold off because of a succession battle.
Mr Kamprad has been slowly withdrawing from the business since 1986, when he stepped down as group president. He maintains that he is still "too much involved and in too many details", although he admits to a distinct reluctance to withdraw altogether. "The criticism that you hear is that he decides everything, even today," says Mr Bo Bergsjý, an executive of Almhult municipality.
The question is: can there be an eternal Ikea without Mr Kamprad? Does the group depend too much on its founder? It is a sprawling empire, held together by his drive and vision and the myths surrounding him. Once he has gone, it may seem like the scattered bits of a self-assembly kit without any instruction leaflet.
