IKEA: The Potato Field That Became a Destination
How cheap suburban land, new apartments, car ownership, and an immersive format changed furniture retail
Brand Learning · Location Changed Everything · Case 6 · Collection I · Prepared October 2026
Photo: Holger Ellgaard via Wikimedia Commons. Displayed with responsive sizing.
IKEA proved that a retailer can trade centrality for scale when the format gives customers a strong enough reason to travel.
The location decision
When IKEA expanded toward Stockholm in 1965, a central retail address would have made its ambitions prohibitively expensive. The company instead chose inexpensive land in Segeltorp, then largely undeveloped, outside the city. IKEA Museum calls it the “potato field strategy”: build where land is cheap, then create an experience large enough to become the destination.
The location was peripheral but not random. It sat near rapidly growing suburban apartment districts created through Sweden’s Million Programme. Roughly 100,000 apartments were built in surrounding areas over a short period. The households moving into them needed furniture. Rising car ownership expanded their practical shopping radius, and IKEA supported the trip with a large parking field and even sold roof racks at cost when purchases would not fit inside the car.
The building and merchandise model converted the travel burden into part of the experience. Room settings helped customers imagine a complete home. Self-service and flat packs reduced handling cost. Food, children’s play, and long browsing time made the visit more than a quick product pickup. The store could use vast, affordable space to present an assortment that a high-street shop could not match.
The opening also revealed a failure of capacity planning. Demand overwhelmed the operating system. Customers queued for hours, product flow struggled, and the huge Stockholm store could not simply copy the processes of smaller Älmhult. A 1970 fire created an opportunity to rebuild and rethink the layout. The location choice was right; the first operating design was not ready for the demand it created.
The strategic model
Destination value
The assortment, price, experience, food, parking, and room displays had to repay the customer for the drive.
Growth adjacency
The site was close to where new households were being created, even if it was outside the established shopping core.
Automobile access
A bulky-goods format depends on road access, parking, loading, and customers’ ability to transport purchases.
Cheap land as format enabler
Lower land cost did not only save money; it allowed a store large enough to make the business model work.
What the strategy got right
It matched a noncentral site to a destination-worthy concept.
It located near future household formation rather than only existing retail traffic.
It used inexpensive land to strengthen assortment and experience.
It adapted the operating concept after the first store’s problems became visible.
Where the model can fail
The first store underestimated throughput and fulfillment complexity.
A car-dependent format excludes or inconveniences customers without easy automobile access unless transit and delivery alternatives compensate.
Large footprints create high fixed commitments and require a much broader catchment than neighborhood retail.
Cheap peripheral land loses its advantage if roads, parking, utilities, and permitting are inadequate.
The impact
Kungens Kurva helped establish a repeatable global format: large stores outside urban cores, ample parking, immersive displays, self-service, food, and a regional catchment. IKEA’s own history is valuable because it records both the strategic success and the operational disorder of the first version.
Questions for leaders and franchise consultants
What makes the concept worth a longer trip?
Where are new households, homes, or employment centers forming?
Can access, parking, loading, and delivery support the product category?
What peak traffic will opening-day or weekend demand create?
Does the site save enough in land cost to fund the experience customers expect?
Applying the lesson with Wanderland
Wanderland can compare household growth, housing characteristics, income, drive-time reach, road accessibility, competing destinations, and supporting businesses. The analysis should distinguish “cheap land” from “economical access to a regional customer base.” Those are not the same thing.
Research sources
Independent educational analysis. Company names identify the subjects of the stories; no endorsement or affiliation is implied. Historical results retain their stated source periods.
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