The flat pack giant was supposed to be the moment the local furniture trade found out how much of the market it really had. Almost eight months on, the firms that build sofas in New Zealand are still building them.
IKEA opened its first New Zealand store at Clemow Drive in Mount Wellington on 4 December 2025, a 34,000 square metre building with about 7,500 products in it. More than 500,000 people went through in the first 30 days. Forsyth Barr analyst Paul Koraua had forecast the store would turn over more than $191 million a year and take roughly 6 percent of the country’s furniture and homewares market.
The retail effect was immediate. Spending data compiled by Dot Loves Data showed Mount Wellington’s monthly homewares spend jumping past $20 million while every other Auckland centre fell back to around $5 million or less, as Newswire reported in May. Gagu Furniture at Westgate confirmed it was closing within days of the opening. Parallel importers who had made a living shipping IKEA products into the country lost their reason to exist overnight, one of them sitting on $5 million of stock.
What the jobs data shows
Manufacturing is a different story from retail. Stats NZ’s linked employer employee data counts 5,110 filled jobs in furniture manufacturing in the March 2025 quarter, the most recent figures released. That is down from 5,820 at the end of 2022, and 90 jobs above the 5,020 recorded at the end of 2012.
The longer run of the series puts that in proportion. Furniture manufacturing employed 8,960 people in the December 2004 quarter. The wave of Chinese imports that followed cut the workforce by 44 percent over the next eight years. Since then it has moved inside a much narrower band, between 4,860 and 5,820.
The direction inside that band is down. Filled jobs have fallen in seven of the last nine quarters, and the March 2025 figure is the lowest since 2016. That is a slow contraction rather than a collapse, and it was already under way well before a Swedish retailer opened in Mount Wellington.
The obvious caveat is that the series stops about eight months before IKEA opened. There is no official measure yet of what the store has done to the people who make furniture here, which for now leaves the accounts of the makers themselves.
The closures this year
There have been closures this year, and it would be easy to hang them on IKEA. The reasons given at the time point elsewhere.
Otago Furniture in Dunedin, which traced its furniture making back to 1868 and employed 17 people, announced in May it was shutting. Chief executive Allister Sneddon told the Otago Daily Times the business had been under financial pressure for years and had run short of orders. “We have just had a lack of orders coming through. In all honesty, we’ve kept it going a lot longer than we probably should have,” he said. The paper’s headline quoted him saying “Covid killed us”.
UFL Group, an Auckland commercial furniture business in Avondale, went into liquidation on 8 April 2026 owing $1.58 million, with 60 creditors including ACC, Customs and the Ministry for Primary Industries. The liquidators’ first report put the failure down to a decline in sales in prevailing economic conditions, leaving the company short of the revenue it needed to cover its overheads.
Neither was competing with a flat pack lounge suite. Otago Furniture built to order for the domestic market and had been struggling since the pandemic. UFL fitted out offices.
Who is still making furniture here
Danske Møbler, started by Ken and Bente Winter in 1958, still makes sofas at its Mt Eden Road factory and employs more than 100 people. Wilson & Nicholson has been building upholstered furniture in Auckland since 1938 and still does it at its Marua Road workshop in Ellerslie, a few minutes drive from the IKEA car park. Owner Philip Caughey told Newswire that IKEA’s arrival has not really affected the business, and that there still seems to be a market for high quality New Zealand made sofas.
That is the pattern across the top end of the trade. The makers still here are not selling the same product. A locally built lounge suite is made to the size of the room it is going into, in a fabric or leather the customer chooses, with a guarantee on the frame, springs and foam, and it can be pulled apart and recovered in 20 years rather than put out on the kerb. None of that fits in a flat box.
Even some of the flat pack sellers are making the local argument. “We were founded in New Zealand, we still have a New Zealand team, and we very much design for Kiwi homes,” Mocka chief executive Catherine Williamson told The Spinoff when IKEA opened. Mocka opened its first physical store in Christchurch in July. Kmart has said it is looking at up to 50 standalone K Home stores.
When the data will show IKEA’s effect
The linked employer employee series runs about 14 months behind. The June 2025 quarter is due on 25 August 2026, and it still predates the opening. On that timetable the first quarter of official jobs data that covers a New Zealand with an IKEA in it, the December 2025 quarter, will not be published until around February 2027.
The question those figures will answer is not whether New Zealand can still make a sofa. It is how many people are willing to pay what it costs to have one made.
Have you bought a New Zealand made sofa, or had an old one recovered rather than replaced? Tell us in the comments.
This article was written by AI, briefed to report the facts, hopefully without some of the bias people bring to the job 🙂
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