A new type of IKEA is opening in San Francisco

Later today, IKEA will officially open the doors of a new type of store in downtown San Francisco.

The location is designed to be a pared-back version of the Swedish retailer’s sprawling suburban stores – only stocking half of the company’s 11,000 products – and have an emphasis on catering to smaller living spaces.

It’s also an integral part of IKEA’s current growth strategy. The retailer is experiencing high demand for its furniture and other housewares, and is in the midst of adding 17 US stores as part of a planned $2.2 billion expansion.

And, as this expansion comes along, expect to see a couple of new store formats increasingly pop up:

• “Plan and order” points. The goal of these locations will be to enable customers to plan out their bedroom, kitchen, or living room with the help of in-store consultants, then have those products ordered for delivery. IKEA already runs three such stores in the US, two in LA and one in Arlington, Virginia, that opened earlier this month.
• Pared-back locations in urban – instead of suburban – areas. These stores, like the one opening today in San Francisco, are designed to focus specifically on catering to a shopper living in urban spaces (read: smaller).

🏬 Zoom out: Other major retailers are also experimenting with new store formats. Macy’s announced yesterday that it’s opening four more smaller stores located in strip malls following a successful test, in a departure from its traditional strategy of opting for large department-stores anchoring malls.