Ikea, the world?s biggest home-furnishings retailer, has slashed the price of its Billy bookcase in the US by 17 percent, amidst unemployment and a sluggish housing market.
The Ikea Billy bookshelf is lightweight, inexpensive, and popular in the?US. The signature bookshelf now costs $49.99.
Recently, Ikea also considered redesigning its Billy bookshelf by including deeper shelves and glass doors. The gaining popularity of e-books and fast changing electronic world have resulted in consumers leaning towards all things digital that resulted in big sales for e-books as compared to hardbacks.
However, unemployment looming large above 9% and housing down by about 73% below the 2006 peak, confidence among American consumers is at the lowest in more than two years.
Payrolls report a stalled growth and consumer spending related to housing has some down. Furniture is the worst-affected category due to the recession, James Shugg, a senior economist at Westpac Banking Corp. in London said.
Furniture sales fell 1.1% in July from a year earlier, while overall retail sales grew 6.5%.
An index compiled by Bloomberg News showed that the price of Billy shelves fell in 21 countries. The biggest decline was reported in China with a 27% drop.
In a similar move, the company has reduced prices in Greece by 22% ? underlying the impact of debt crisis. Greek outlets now sell the signature bookshelf for ?35 ($44.95), down from ?45 last year.
Globally, the lowest dollar prices for Billy shelves were in the Netherlands, where they cost $42.82, and France and Belgium, where they were listed at $49.97. The highest were in the Dominican Republic and Israel, with prices of $111.54 and $96.87 respectively.
The bookshelf’s cost in the United Arab Emirates is AED175 ($47.64).
The average price of the item in 37 countries dropped 7.6 % to $55.54, according to reliable sources. The cut suggests a sluggish demand across Europe and North America.
Sources: Economist, Bloomberg