Ikea

In addition, big store also can enjoy economies of scales because IKEA can rent the stores at a lower rent when they rent it in huge size.
             The other feature of IKEA shows it is use global strategy is that it uses little money on doing the marketing, production, and R&D in every country. Firstly, IKEA is a production oriented company, they will produce what the products' size, color, type which they like without concern about the customers' want, so it can save money from doing marketing research and money to develop the product which the customers want, and it can make IKEA to produce the products in a huge amount. Also, the marketing also are based on Sweden s advertising, it use its Swedish blue and gold color for the stores without changing. About the production, IKEA sell the same products all over the world without thinking about what different products are wanted in different countries. Therefore, IKEA can enjoy the economies of scale from producing the products in a huge amount, so they can enjoy a high profit rate although they set the price at a low level. Also, IKEA still have competitive power with its rivals because they emphasis on good quality. It provides an after-tax return on sales of about 7 % even though it undercuts 30% of the selling price. It increases the confidence of customers to buy IKEA products.
             Besides, another reason that the IKEA was using the global strategy is because they ignored the retailing rules that international success involves tailoring product lines closing to national tastes and preferences. And therefore, only standardized products were sold in the global market. IKEA sold only the same products with only Swedish-designed in the same manner all over the world without any customization to different customers' tastes and preferences in different countries. Due to the standardized offered by IKEA, customers buy the products form IKEA because of the lower prices.