Sauder to make Ikea kitchen cabinet components

Heath E. Combs, February 26, 2007

Sauder Woodworking has signed a deal with Ikea to produce kitchen cabinet components for the eastern two-thirds of its North American stores.

Starting mid-year, Sauder will manufacture Ikea's Akurum kitchen frames and its Rationell kitchen shelves over a three-year period. The frames and shelves are currently made in Eastern Europe.

"We have been working with Ikea for over seven months to mesh our capabilities with their specifications," said Kevin Sauder, president and CEO of Sauder. "And we believe that these are the first of several lines we will be making for Ikea."

Ikea is adding North American sources to more efficiently supply its stores with the continents. The Swedish retailer has 39 stores in the United States and Canada, with plans to open three to five stores a year in North America.

The relationship with Ikea is part of a strategy Sauder put in place last year to grow its business by continuing to serve its traditional retailer base with Sauder branded furniture, to provide private-label and licensed product to mass merchants, and to explore new product categories and contract manufacturing opportunities.

In October, Ikea's manufacturing arm, Swedwood, announced it will build an 810,000-square-foot factory in Danville, Va., to make wood furniture for the company, its first U.S. manufacturing facility.

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