IKEA acquires Locus AI logistics platform to cut delivery costs by €100M annually

IKEA's ecommerce share surged from 11% of total sales in FY2019 to 28% in FY2024, creating compounding pressure on a supply chain originally architected around high-volume store replenishment rather than direct-to-consumer last-mile delivery. As one of the world's largest home furnishings retailers operating across 60+ markets, Ingka Group faced a structural mismatch: digital-native competitors like Wayfair had purpose-built logistics stacks, while IKEA was retrofitting delivery infrastructure at global scale. Insufficient delivery time slot availability, absent real-time tracking, and rising last-mile unit costs threatened to compress margins precisely as ecommerce became a larger and faster-growing share of the business.

Ingka Group acquired Locus, a US-based AI logistics platform, rather than licensing third-party software — a deliberate choice to retain full ownership of the technology roadmap and deploy it without vendor dependency constraints. Locus applies machine learning and predictive analytics to dynamically plan delivery routes, optimize vehicle and resource utilization, and provide real-time shipment tracking across last-mile operations. The platform integrates with capacity management workflows, enabling more granular control over delivery slot allocation — critical for IKEA given its mix of small-parcel and large-format furniture requiring scheduled delivery windows. Ingka is following a phased rollout: initial pilots in the US and UK will validate the model before global deployment, allowing localized calibration of routing algorithms before scaling across markets with different road networks, regulations, and customer expectations.

The acquisition is projected to deliver approximately €100 million (~$117 million) in annual delivery cost savings, driven by reduced vehicle idle time, improved route density, and more efficient capacity utilization across IKEA's last-mile network. Beyond cost reduction:

• Delivery slot capacity is expected to increase, addressing a friction point that constrained online conversion
• Real-time package tracking will be introduced globally, closing a customer experience gap versus digital-native competitors
• The savings target reflects efficiency gains across a network scaled to support ecommerce that now represents 28% of total sales — more than doubling its share in five years

• Acquire, don't license, when scale justifies it: Full platform ownership gives large omnichannel retailers control over the development roadmap and eliminates per-transaction cost structures that become prohibitive at nine-figure delivery volumes.
• Phase pilots by market before global rollout: Testing in the US and UK lets IKEA validate routing models in high-complexity markets before committing to worldwide infrastructure changes.
• Ecommerce growth creates non-linear logistics cost pressure: Moving from 11% to 28% digital sales share in five years does not require a proportional increase in logistics spend — but only if infrastructure investment precedes the scaling, not follows it.
• Last-mile is the margin battleground for omnichannel retail: Route and fleet optimization is where the largest controllable cost reductions now live for enterprises with dense, geographically dispersed delivery networks.