Ikea’s enigmatic founder, Ingvar Kamprad, turns 90
Ikea founder Ingvar Kamprad, pictured on December 3, 2012, has been described as an obsessive penny-pincher despite being one of the world's richest people (AFP Photo/Fabrice Coffrini)
STOCKHOLM: Ikea founder Ingvar Kamprad, who built a global business empire with revolutionary flat-pack furniture and dallied with Nazism in his youth, turns 90 on Wednesday.
Creator of the Swedish furniture empire famous for its thrift, style and convenience, Kamprad is also known for alleged tax avoidance.
The contrasts at Ikea — an everyman’s furniture store yet global behemoth — illuminates his conflicting character.
An admirer of the humble classes who bent over backwards to avoid paying taxes, Kamprad has been described as an obsessive penny-pincher despite being one of the world’s richest people.
He created a modern, visionary business model but never escaped the taint of his support for Sweden’s fascists, despite dismissing the episode as “a folly of youth.”
Born in 1926 to a farmer in Smaland — a poor region in southern Sweden known for its entrepreneurial spirit — Kamprad’s ascent to wealth began at the tender age of 17.
Backed with modest financial support from his father, Kamprad began selling pens, picture frames, typewriters and other goods, delivering orders on his bicycle. His early success arose from squeezing his prices to undercut more established competitors.
He christened the fledgling business Ikea, stringing together his initials and those of the Elmtaryd farm where he grew up in the town of Agunnaryd.
– The self-assembly revolution –
In 1947 the young Kamprad started selling furniture made by local artisans, and four years later began publishing the first of his mail order catalogues — now printed in 200 million copies and 33 languages annually.
Ikea’s revolutionary self-assembly model — which would cut transport and storage costs — was conceived in 1956 after an employee suggested table legs be removed during freight so the package would fit into a car.
Two years later Kamprad opened Ikea’s first store in Almhult, south of his hometown.
He was proud of the egalitarian spirit that his company promoted, telling Sydsvenskan newspaper in 2008, “I belong to the people on the (shop) floor”.
“The greatest intelligence within Ikea is on our floors. If I want to know something I don’t approach a top manager, I talk to ten sales people,” he added.
But he had a tough side that helped him conquer the world.
From 1970 on, Ikea conquered major markets in Europe, North America, Asia and the Middle East, thriving on the spending power of the emerging middle class in countries like post-Cold War Russia.
– The tax hater –
Despite his enormous success and wealth, Kamprad’s modest spending habits bordered on obsessive.
In 1973 he fled Sweden’s higher tax structure for Denmark, before seeking even lower taxes in Switzerland.
Ever frugal, Kamprad reportedly drove an ageing Volvo, and regularly used his supermarket loyalty card.
Reflecting Kamprad’s dislike of taxes, the International Consortium of Investigative Journalists in 2014 cited leaked tax files from Luxembourg in identifying Ikea as one of the giant multinationals fingered for corporate tax avoidance by shuffling money from high taxation countries to tax havens, minimising his company’s bill.
At a time when the tax arrangements of multinational behemoths such as Amazon and Google are under the microscope, a report before the European Parliament accuses Ikea of avoiding more than a billion euros (dollars) in taxes.
Ikea insists it complies fully with national and international tax regulations.
– Nazi ties –
Another shadow is cast over the Ikea founder by his early days in the Swedish Nazi party.
Sweden was neutral in World War II, and its Nazi party remained active after 1945, although the Ikea founder has said he stopped attending its meetings in 1948.
From 2010 onward Kamprad progressively made way at the helm of the family company for his three sons, finally returning to live in Sweden in 2014.
He was voted his country’s greatest entrepreneur by the readers of newspaper Svenska Dagbladet.
“I saw the wretched farm workers who weren’t allowed to eat inside but had to eat in the stable,” Kamprad said upon receiving the prize.
“I learned one thing: if I were to succeed with my little ideas and become a businessman, I had to never abandon the poor.”