Swedish furniture and homewares giant Ikea has announced its plans to open an online store in Australia, a move expected to push the profits beyond $1 billion.

The retailer will first build an online portal within the next six months before the predicted launch of a permanent digital outlet early next year.

Twenty-five year IKEA veteran and Australia managing director David Hood told Fairfax Media, the online store has the potential to become the country’s largest store. The sales are expected to rise around 20 per cent this year, passing the $1 billion mark for the first time.

He added that the online component will see the same profit spike that the United Kingdom enjoyed when IKEA launched online sales there.

“It’s a huge growth engine in the UK but it’s not taking away from stores,” Mr Hood said.

“We have various templates we could use but we haven’t decided with way to go.”

There are eight IKEA stores in Australia, including one owned by a franchisee, and a ninth is set to open in North Lakes, north of Brisbane, by the end of 2016.

Globally, the IKEA Group has 315 stores in 27 countries and a further 40 plus stores run by franchisees.

– with other agencies