ARCHBOLD, OH - IKEA will expand Sauder Woodworking's contract. Sauder's Archbold, OH plant, already producing IKEA kitchen cabinets, will now produce four furniture lines for IKEA as it readies stores in Miami, Kansas City and St. Louis for opening in 2014 and 2015.
IKEA US said it awarded Sauder Woodworking 5-year contract that will create at least 150 new jobs and involve an equipment investment of over $13 million by Sauder.
Sauder Woodworking Co., one of the top manufacturers of ready-to-assemble furniture, has supplied IKEA US since 2007. Under the terms of the new contract, Sauder will be producing bedroom furniture, office, entertainment and children's storage furniture.
"We have been successfully supplying IKEA its AKURUM kitchen cabinets for the last seven years, so when IKEA was looking for North American partners to help them sustainably supply their North American stores with quality furniture, they looked to Sauder," said Kevin Sauder, President/CEO of Sauder. "Our teams have worked together closely."
IKEA sourced from 25 U.S. suppliers. it's captive IKEA Industry factory in Danville, VA, was the largest, supplying 19% of domestic sourcing, by cubic volume. Other suppliers in North America brought total domestic sourcing up to 31% of the cubic volume sold in U.S. stores. Products produced in the United States include kitchen cabinets, mattresses, sofas, entertainment furniture, shelving units and appliances, IKEA says.
Rob Olson, CFO, explains in a video that IKEA US expansion into three more cities in 2014 -Miami, St. Louis, and Kansas City - means the global furniture giant is "looking to expand our manufacturing base here, so that we can deliver our products economically and sustainably. IKEA strives for long-term partnerships with suppliers to secure efficient production and growth. The relationship between IKEA US and Sauder Woodworking is a good example of that."
IKEA says the Sauder relationship is a business decision that also has environmental benefits, since increasing U.S. sourcing shortens transport distance between the manufacturing site and stores, thereby reducing carbon emissions.
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