IKEA is investing £31.5 million into its UK online fulfilment to make it more efficient and sustainable.
The Swedish furniture giant has four major customer distribution centres (CDCs) in the UK – in Peterborough, Doncaster, Dartford and Northamptonshire. In Peterborough, new technology is packaging customer orders to size and reducing material usage by up to 30% by preventing waste from oversized boxes and filling paper.
The new Packsize technology is expected to increase the share of parcels processed through automation at the Peterborough CDC from around half (47%) today to three-quarters (75%) in 2027. Previously, items were packaged by manually creating a packing carton, which involved measuring the article before creating the cartons to fit the order.
Meanwhile, IKEA has shifted fulfilment for customers in the north and Scotland from Peterborough to Doncaster – its biggest UK CDC at 1.3 million square feet – in order to streamline the delivery process and make it more sustainable. It anticipates this will save more than 280 tonnes of CO2 annually.
Online growing fast
With more IKEA customers choose to shop online – online sales accounted for almost half (43.3%) of IKEA’s total UK sales in financial year 2026 – the company believes the changes will better position it for sustainable growth.
David McCabe, CEO and CSO of IKEA UK&IE, said: “These investments in our Peterborough and Doncaster Customer Distribution Centres will ensure fulfilment is smoother than ever and reduce our environmental footprint – while positioning the business for long-term success by strengthening operational efficiency and supporting sustainable growth.
He added: “Our wonderful teams of co-workers in Peterborough and Doncaster work tirelessly getting orders to our customers, and we couldn’t function without them. We’re empowering our people to get the best out of these new technologies, and we’re excited to watch them grow alongside the business.”
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