Per
– My name is Per, and I’ve been with IKEA since I was very young, done all kinds of things in the company and have the joy, in the end of it all, to be a part of telling the story of IKEA.
Jan
– Yes, I am Jan Ahlsen. Working within IKEA with everything from quality, purchasing, product development in different fields, but mostly within wood and nature fibres.
Per
– When Ingvar Kamprad started selling furniture in 1948, his suppliers were small craft industries, small furniture factories in the part of Småland where he lived. Factories with their roots in farming and carpentry work. They used the local wood, as they had always done. It was the furniture from these factories that Ingvar sold, and in 1953 he opened his first permanent show room in Älmhult, and customers came from all over Sweden. Furniture retailers, the ordinary furniture retailers, in the cities, saw IKEA as a serious threat to their own business. They had their trade association organise a boycott against IKEA. The boycott of course caused serious problems for IKEA. Ingvar and his new purchasing manager, Ragnar Sterte, couldn’t buy what they needed in Sweden anymore. So, they started to import furniture from Denmark. That was good, but not enough. So in 1960, when the Polish foreign trade delegation came to Sweden to promote business opportunities in Poland, Ingvar became curious, and he became aware of the possibilities and was able to secure an invitation to visit Poland in January 1961. What type of wood was it that they found in Poland, Jan?
Jan
– What’s interesting here is of course that during this time the slightly darker wood was very popular in Scandinavia.
Per
– Yeah.
Jan
– Mainly teak made by the Danish guys.
Per
– Yes.
Jan
– During the visit in Poland they discovered oak, that was also a kind of hardwood, and with slightly more flexible eyes it could look like teak sometimes.
Per
– Right, yes.
Jan
– So, you could say oak became IKEA’s teak. It was cheaper and produced in a country with lower production costs.
Per
– Then they of course started selling the Polish oak furniture, and I remember that one of the most popular products was called MTP.
Jan
– MTP, yes.
Per
– Yes, that was a bookcase series that was designed by one of their colleagues in Poland, Marian Grabinski. And that became such a success in Sweden.
Jan
– Yes.
Per
– So, Swedes took oak from Poland to their hearts and didn’t really mind if it came from Poland, or where it came from. They liked it, and above all they liked the price, because IKEA decided that they were not going to make super high profits because of buying it at a really low price. They were going to pass the savings on to the customers. So that was furniture that no one had really seen, such good furniture at such low prices. So, for years I think we were quite successful with Polish oak furniture.
Jan
– Yeah, then of course as always when you find a new low-price material in wood, we start to buy a lot. Demand increases, and when demand increases, the price goes up.
Per
– Exactly. So, as IKEA people always are, they were sort of on the hunt for a new type of wood that could match the oak when it came to price. And that’s when another tree entered the story. What was that, Jan?
Jan
– I hope we’re thinking about the same one. I’m thinking about pine.
Per
– Yes.
Jan
– Even here, Poland played a major role in introducing pine to IKEA. The pine was mainly, at that time, used for the building industry. So, it was really low price, you could say, already from the beginning. And that also turns us back a little bit to Scandinavia, because it was the same situation in Scandinavia. Pine was used for building.
Per
– Pine furniture wasn’t considered really high class. But after the war people started to buy little hunting lodges, little summer houses, and Swedish furniture factories started developing pine furniture. And they always used the best part of the pine, the pine that was very even and light in colour. But something else happened with IKEA, the way that we decided to use pine.
Jan
– Yeah. At that time, when you talked about pine and started using it for interior design, you could say it was the knot-free stuff. Knots are the branches on a tree. And when you cut it or saw it down, you see the remains of the knot as brownish or black or different sizes. They are on the top part of the tree. At that time, this part of the tree was not used at all, not even in the building industry, you could say, more or less. It was used for paper pulp or firewood or something like that, not at all in interior design. One of the main problems with introducing it… because Ingvar of course, he was very keen on prices, so he could see that if we took the wood from the top part, we could cut prices even more and make the customer even more happy with cheaper furniture.
Per
– And we were so successful with it. People talk about the pine-wave. And it was twenty years of pine furniture with knots, and we built our whole success on this fantastic raw material and the unique price point, the IKEA low price for really good quality and function. There are immortal products from that time, like SÖRGÅRDEN and IVAR, for example. Products that lots of people still remember. It was always “how can we get more from less?”.
Jan
– Yes.
Per
– “How can we actually use the whole tree?” Because the problem in the furniture industry has always been that you’re able to use such a small part of the tree itself for furniture. And I think when we actually did build our own sawmills, we were able to find a new standard for how we process the wood.
Jan
– Because before, you could say, we were buying the normal timber that was available on the market, and that timber was in dimensions made for the building industry. And suddenly we could start to cut the trees in the sawmill for the furniture industry.
Per
– Exactly.
Jan
– Because as it normally is, you actually only use like five per cent of the tree.
Per
– Really, five per cent?
Jan
– Yeah, for the final product. But it is important then to not call the other 95 per cent waste, because it’s not. It’s for alternative use. Starting from the beginning of course you have the branches, which normally get used for firewood and it’s perfect if you do that, turn it into like pellets or something like that, to use it for that. You have the bark, same with that. Then you have the sawdust, there’s a lot of sawdust of course and that can be used for different board materials. Some part of the tree, normally the centre part, if you take pine, there’s a lot of resin in it, a little bit fatty, you can say, which makes it a little bit difficult to apply a surface treatment on it. But then there are other industries that love this kind of wood.
Per
– Which are they?
Jan
– That’s the carpentry industry. Because that means that the wood used for windows is already in a natural way impregnated, so it was more long lasting.
Per
– So, the core of that tree is used for windows?
Jan
– When it came to pine, yes.
Per
– And what is outside the core then goes to furniture?
Jan
– Yeah.
Per
– And the very outer part, the edges…
Jan
– Yeah, the edges are used mainly for paper pulp and board materials. So, the whole value chain of the logs became a little bit different. We started developing one product directly at the sawmill, and that was the basic shelf called STEN at that time.
Per
– Yes.
Jan
– And then we integrated very much with these sawmills, and the sales of that one became incredibly high. The first time we showed it here in Älmhult to the retailers, including Ingvar at that time, everybody liked it. But Ingvar was very cool, and he said: “I want you not to sell this one.” And everybody was surprised, because we thought it was great and the price was fantastic. “No, I want you to produce and fill up all the warehouses we have with that product.” And then for the next year we put it on the front page of the German catalogue. So, for eight months this sawmill was also producing for the warehouses, and then when it appeared on the front page in Germany sales just rocketed, like this.
Per
– An enormous success, the STEN series.
Jan
– Yeah.
Per
– And that was not pine, that was another…
Jan
– Yeah, that was spruce.
Per
– What’s the difference between pine and spruce?
Jan
– One of them can be used as a Christmas tree, the other can’t.
[Laughter]
Per
– And spruce is the Christmas tree?
Jan
– Yeah, spruce is the one. There’s a big difference. You could say that the spruce is a little bit softer when you touch it, it gives you a warmer feeling, if you like, to touch it that way. But the bending properties are higher than in pine, because the fibres are longer.
Per
– If you imagine a shelf made of pine, solid pine, and you compare it to a shelf made of solid spruce, and you load it with books, the pine shelf bends more than the spruce shelf.
Jan
– Yeah. So, if you make it in pine, the shelf, you maybe have to make it 25 mm thick, but in spruce it’s enough with 19 mm. It also saves material, you could say.
Per
– So, we’re into trees and we’re into knots. We’ve talked a lot about pine and spruce. But when we started in the old-fashioned Swedish furniture industry, there was birch. And birch was always quite expensive because everyone was using the knot-free birch, which is like, if you talk in food terms, it’s like a coeur de filet. It’s really, really fine wood. But someone in IKEA did something unique there too. Someone went somewhere and did the knotty thing again.
Jan
– Yeah. It also had to do with the fact that IKEA is also about Scandinavian design, which means light coloured wood, you could say, and that birch came in as the perfect thing for that. And we have been, over the years, using birch in veneer and book shelves and tables and so on. And then someone turned to Poland again, I think it was.
Per
– I think it was Roland Johnsson, who went to Finland, and he found that the sawmills in Finland processed a lot of birch, but the knotty part of the birch tree was just burned, it was just waste. And I think he took the initiative to make some glued birch panels with knots and brought them home here to Älmhult and showed them to us. And we were like “wow, that is beautiful”. And when he told us the price, then we went crazy. And I think the first big success was called NORDEN.
Jan
– The NORDEN table, yeah.
Per
– And so, in a way, Roland, he did the knotty pine trick again, but with a new type of wood.
Jan
– Yeah, and that was really beautiful, because then it became more IKEA as well, you might say. We turned it into IKEA material.
Per
– And a unique price point again. Solid wood, really good quality. The NORDEN tables sold really, really well. And even today, as we speak, you can find the knotty birch in the stores. And it was such a big success that Finland wasn’t enough.
Jan
– Yes, that was based on the fact that Ingvar had gone with Örjan Gunnarsson to China. I went there and I went up to the far north of China, Mohe. But there was a lot of birch there. Some of it was Chinese, but later on I discovered that some was coming in, dropping in, from Russia. And also of very good quality, because during that trip I bought bunches of veneer and sent it to Swedwood as a present.
Per
– Then in 1989 something special happened. What happened then, Jan?
Jan
– The big thing was that the Berlin Wall fell down.
Per
– The Berlin Wall.
Jan
– And that of course hit our business relationship with the companies in the Eastern Bloc.
Per
– A whole purchasing strategy fell to pieces, and we had to start working in totally different ways.
Jan
– Yeah.
[Anders is calling]
Anders
– Excuse me, Jan. My name is Anders Hörberg, and I’ve worked with the solid wood development in IKEA almost all my life, 35 years. In 1984 I was responsible for the Soviet Union, for the purchasing market. And in that time, it was 95 per cent only pine furniture. And we worked with the state organisation Exportles. And to work in the Soviet Union at that time was quite tough. It was slow, bureaucratic and we were not allowed to visit all the places we wanted. So, a lot of permissions. It went quite slowly in the beginning. But I think it was in 1986 the prime minister, Ryzhkov, visited Sweden, and at that time, he also visited IKEA in Gothenburg. And then he said that “these stores we should have in the Soviet Union”. And there it started, because after this visit a lot of things happened, from the government and from the export organisation in Moscow. So, there was an invitation for Mr. Kamprad to come to Moscow and discuss the development of stores and, also, the development of purchasing of furniture. So, we went to Moscow in 1988, had a meeting with Mr. Ryzhkov at the Kremlin. And after that it was decided that we should invest in the furniture factory, increase the volume of pine furniture, and other furniture as well, and we should also establish an office. And the focus was on the development of the pine furniture. As everybody knows, in 1991 a lot of turbulence started in the Soviet Union and it went into Russia, and Mr. Yeltsin was president, and a lot of changes came. The factories were privatised. So, we had to start a little from the beginning again. So, it took quite a long time and Russia didn’t come to be the big pine supplier as we had expected. But now today it’s quite big and one big part of that is also that the industrial group of IKEA have established in Russia, in Saint Petersburg, and I was the first person from IKEA to work in Russia. I have employment number one in Russia.
[Anders hangs up]
Per
– Around that time, we started using another wood-based raw material that has become really, really important. Do you remember that, how that started?
Jan
– Yeah, I remember, because at that time I was actually responsible for the purchasing of kitchens for IKEA. That time was something we today call board-on-frame. Then I think it was Gillis Lundgren actually, who was looking into the process of doing this and started thinking “what else can we do”. Because again we were using less material.
Per
– Yeah, because this is not like solid wood. This is kind of a sandwich construction, isn’t it?
Jan
– Yeah, it is. It was this board, hard board, with a frame of pine or other material and then you fill it up with something we today call honeycomb. It looks like bee…
Per
– Bee cakes? (Swedish term for honeycomb)
Jan
– Bee cakes, yes.
Per
– It’s actually paper, isn’t it?
Jan
– Yes, it is paper. To keep the distance between the boards and still make it strong. That was the development to try to make slightly bigger furniture. We had these small tables, still called LACK, I think, in the company.
Per
– Yes.
Jan
– But Ingvar was striving to build more of this material and try to make bigger tables.
I have to mention this one also, because I got the possibility to look around China.
Per
– I think that is hugely important. You got the job to go out there and find wood and find ways of using it for furniture.
Jan
– Yeah.
Per
– There you have sort of the core of how IKEA works, always on the lookout for new raw materials and ways of using them. So, what did you find?
Jan
– What I did was, I think, I can not only go out there, you know, as a backpacker. I have to find someone who knows. So, I contacted a company in Sweden who made grinders for chipboard, because they were all over the world. And I contacted big international papermills to see what kind of wood they were using. And also you always have people in that company who take care of purchasing the raw material, so they know so much about the forestry in this area.
Per
– Of course.
Jan
– So, I went there and interviewed them and looked into their way of working, their strategy and nearly all of them were in plantation. I said: “That’s good. Then we don’t need to be in the virgin forest, we can be in the plantation,” thinking about the environment, and things like that. So, there we found two major wood species. One was eucalyptus and the other one was acacia. So, we started, of course, to make samples, calculating, and the price was very good. Because that business was business for the pulp industry, so the price was very low.
Per
– It wasn’t the furniture industry, it was the pulp industry.
Jan
– Because we were always hunting for an advantage. So actually, we let these two species, acacia and eucalyptus, compete with each other. And in the end, it became acacia.
Per
– Right. Why?
Jan
– I had a very good friend, I have a lot of stories about that one, but I have a very good friend in Malaysia, Kennet Jonsson. And in his area, there was no eucalyptus. But he was a very strong guy, you know.
Per
– And he is a strong guy.
Jan
– Yeah, as a purchaser and he has so much energy. So, because of him, I would say, it became acacia. His way of working made it.
Per
– Yes, he’s been with us for ages. He was there when it started, almost. So, he led you down the acacia path.
Jan
– Yeah. Eucalyptus became a little bit… It’s more tricky.
Per
– And it’s quite heavy, isn’t it?
Jan
– It’s heavy, yes. You could say the density… If you say acacia is like 750 kilos per cubic metre, compare with pine, 470 something. And eucalyptus 900. So, it’s heavier. And acacia looks more like teak, and eucalyptus more like mahogany, you could say. But it’s also trickier, but during that time, since we let these two wood species compete, you could say, and it was not only the species, it was also the organisation of course. So, Kennet was the real driver of acacia. At the same time, the head office was in Singapore for the trading trading out in Asia. And then they decided, because they know from the knowledge we had been collecting that there was a lot of plantation in Laos. And the reason for the plantation in Laos was because during the Vietnam war, most of the bombs actually fell in Laos. So, American organisations have sponsored replantation and forest and so on. Then they have been using eucalyptus, and there was also a plan there together with international banks to build a dam.
Per
– For water power.
Jan
– Water power.
Per
– Hydroelectric power.
Jan
– Hydroelectric power, yeah. And there was a lot of pine there that had to be cut down. So, therefore the organisation there decided, without having any discussion, they started up to build a sawmill in Laos together with a Swedish guy, who was living in Laos. A big entrepreneur, a great guy. So, we were sitting there with a sawmill in Laos. I was not aware of it either at that time. So, I got a call from Stig Holmqvist.
Per
– He was the manager of our own production, of the company Swedwood.
Jan
– Yeah. So, he called me and said: “Do you want to go to Laos?” “What is the purpose?” “There are two. One is that they are planning to build this dam.” And the other one was that there is a sawmill there that they want us to invest in. “Okay, we can go there. Can you send me all the papers about that then? So, I can be prepared.” So, he sent me all the papers and a couple of weeks later we were on the airplane out to Bangkok. I had been reading the papers and I said: “Yeah, that was interesting that we became sawmill owners in Laos.” “No, no, no. We are not a sawmill owner,” he said. “They want us to, but we will not discuss that.”
“Yes, but we are a sawmill owner,” I told him. “No.” And he started to become a little bit angry. “Why are you saying that? Do you try to change my mind, or…?” “No.” “If I read the document, we are the owners.” “Where is that?” he said, so I took the paper, because I underlined it, and gave it to him. “Oh shit,” he said. But anyway, when we got there, this Swedish entrepreneur, who we owned the sawmill together with then, he picks us up in a Land Rover. And then Stig said: “That’s a nice car you have.” “It’s not mine,” he said, “It’s yours.” That was very funny. So anyway, during that couple of days there we ended that ownership, you might say.
Per
– That was one of the few dead ends.
Jan
– That ended eucalyptus, you might say, because that was eucalyptus there.
Per
– That’s not all you found. You found other possibilities in the Far East that today are quite important.
Jan
– Yeah. Are you thinking about bamboo, or something?
Per
– Exactly.
Jan
– But that actually started with Ingvar as well. He was down in Vietnam…
Per
– Was that for his 60th birthday?
Jan
– Yes, and at that time his son Jonas was based there as a product developer and designer. And when he came home, he told us about this cheap material that is not used for anything. And he also ordered a pallet of bamboo poles. A couple of weeks later it turned up in the office, and it was there for many weeks and it started to get mouldy, because no one felt the ownership of that one. Ingvar thought that this idea, everybody will jump on it, but no one jumped on it, and it started to smell, you know. And then my manager, Kurt Wirland at that time, said: “Can you not look into this one, and see? We have to give Ingvar an answer,” more or less.
Per
– What we want to do with the bamboo.
Jan
– I got a little bit lucky, because at the same time here at IKEA of Sweden they had a discussion about flooring. So, they were looking for new expressions, new things. So, one of the guys that I had hired in Vietnam, we went out on the streets and made a small plate like this, handmade, and said: “Yeah, we can do flooring, and send it to IoS.” And we stipulated the price as well and everything and said: “In a month.” “Very good. How much capacity do you have? When can you deliver?”
[Laughter]
Per
– But you invented the bamboo flooring, didn’t you?
Jan
– Yeah.
Per
– You invented the way to produce it and how to use the material yourself.
Jan
– Yes.
Per
– We’ve seen some lovely furniture series in bamboo. Not only the bathroom series, but several others as well. In one of the PS programmes there was a kitchen table, fantastic. We’ll have to say like Ingvar always said: “Wonderful future. Most things remain to be done.” And that goes for bamboo too, I think.
Jan
– Yeah, definitely.
Per
– There’s still a potential to do more with bamboo
