Ingvar Kamprad – Home Furnishing

Kamprad was born in the South of Sweden in 1926 and brought up on a farm called Elmtaryd, near the small village of Agunnaryd. Kamprad began to develop a business as a young boy, selling matches to neighbors from his bicycle. He found that he could buy matches in bulk very cheaply from Stockholm, sell them individually at a low price and still make a good profit. From matches, he expanded to selling fish, Christmas tree decorations, seeds and later ball-point pens and pencils. When Kamprad was 17, his father gave him a reward for succeeding in his studies [2]. He used this money to establish what has grown into IKEA.

The acronym IKEA is made up of the initials of his name (Ingvar Kamprad) or IK plus those of Elmtaryd, the family farm where he was born; and Agunnaryd, a nearby village in the province of Småland.

Kamprad has admitted that his dyslexia played a large part in the inner workings of the company. For example, the Swedish-sounding names of the furniture sold by IKEA were originally chosen by Kamprad because he had difficulty remembering stock keeping units (numbers).

Kamprad has lived in Epalinges, Switzerland since 1976. According to an interview with TSR, the French language Swiss TV broadcaster, Kamprad drives a 15 year old Volvo, flies only economy class, and encourages IKEA employees always to write on both sides of a paper. In addition Kamprad has been known to visit IKEA for a cheap meal. He is also known to buy Christmas Paper and presents in the post-Christmas sales. While Kamprad's frugality is well documented, it is also an important part of the carefully managed image presented to IKEA employees and the general public. He less frequently mentions that he owns a villa in an upmarket part of Switzerland, a large country estate in Sweden and a vineyard in Provence in France or that he drove a Porsche for several years.

Kamprad is also a self-admitted alcoholic, but has stated that his drinking is now under control.

Controversy

In 1994 the personal letters of the Swedish fascist activist Per Engdahl were made public after his death, and it was revealed that Kamprad had joined Engdahl's pro-Nazi group in 1942. Kamprad had raised funds for and recruited members to said group at least as late as September 1945. When Kamprad quit the group is unknown, but he remained a friend of Engdahl until the early 1950s.

Since the public revelation Kamprad has said that he bitterly regrets that part of his life, calling it his greatest mistake and he subsequently wrote letters of apology to all IKEA employees of Jewish descent. It's believed that the fact that IKEA is one of the few retailers to have a store in Israel even though it also does business with the Arab world reflects an attempt to temper this controversy.[8]

Net worth

According to Swedish business weekly Veckans Affärer[9], he is the wealthiest person in the world. However, IKEA denies this assertion, noting that since Kamprad no longer owns the company, it should not be included in calculations of his wealth. However, The Economist magazine recently argued that he and his family still control the company through a complex ownership structure centered around Stichting INGKA Foundation and INGKA Holding.[10]

Forbes magazine continues to rank Bill Gates at #1, ranking Kamprad at #4. It was in the aftermath of the Veckans Affärer article that Kamprad advanced from #12 to his current position in Forbes. According to the German T-Online, Kamprad is the 4th richest person in the world, with 53 Billion USD. As at March 2005, the sliding value of the U.S. dollar put Kamprad ahead as the richest person in the world in another report. In March 2006, Forbes magazine estimated his fortune at US$28 billion.[11]

Stichting INGKA Foundation

The Dutch-registered Stichting INGKA Foundation is named after Kamprad, and owns INGKA Holding, the parent company for all IKEA stores. The charitable foundation was reported by the business magazine The Economist in May 2006 to be technically the world's wealthiest charity - with an estimated value of at least US$36 billion in 2006 (larger than the Bill & Melinda Gates Foundation) - but its primary purpose is, by some, believed to be corporate tax-avoidance and anti-takeover protection for IKEA.[10] Kamprad is chairman of the foundation.

Footnotes

^ Profile on Forbes Magazine retrieved on March 10, 2006

^ Ingvar Kamprad: IKEA Founder and One of the World's Richest People (About.com Entrepreneurs)

^ "Cheap is good, says furniture magnate" NZZ Online, March 27, 2006

^ Ikea-Kamprads lyxvillor, Expressen, August 22, 2004

^ Folkhemsmöbleraren 80 år, Dagens Industri, March 29, 2006

^ Lyxhusen som Kamprad vill tala tyst om, Dagens Nyheter, August 19, 2004

^ "It started in a shed" The Age, July 15, 2004

^ "Swedish goulash and sofas whet Israeli appetites at Netanya Ikea" Jewish News Weekly of Northern California, April 6, 2001

^ "Who's really the world's richest?" CNNMoney.com, April 6, 2004

^ a b IKEA: Flat-pack accounting. The Economist. Retrieved on January 2, 2007.

^ "Number of billionaires surges" CNNMoney.com, March 9, 2006

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