“We hope to become profitable in 2019 as we already are in cash profit and hope to touch a
The city-based company is backed by big-ticket investors namely Goldman Sachs
and Zodius Technology Find
(a cumulative $100 million in series D funding since 2015), Norwest Venture Partners ($43 million since 2011 in three installments), and Bertelsmann India Investments ($5 million since 2014).
The company nets a little over 50 per cent of its volumes from home brands, and around 30 per cent of total sales happen through Studios, the retail stores where no actual sales happen, he said, adding 75 per cent of the volume comes from furniture.
On expansion of its physical stores, he said, they already have 25 and will add 10 more by April.
"Studios get us good traction as conversion rate is over 65 per cent. We feel physical presence as one of the most effective way for brand building and most of the new stores will come in small towns like Indore where we just opened a Studio," Kesury said.
According to him, the next level of Studio expansion will mostly be through the franchisee route, after its success in Bengaluru.
Talking about house brand expansion, he said early this week they launched Clouddio, offering mattresses, pillows and mattress protectors.
The organized mattress market is worth around Rs 60 billion and is growing at 38 per cent, according to Kesury.
The company's house brands portfolio consists of nine brands in the furniture and modular segments and the entry into the mattress segment is in line with its strategy of expanding its own brand portfolio as this segment has higher margins, he said, adding he expects this portfolio to account for 15 per cent of the revenue in the first year.
Pepperfry is present in 500 cities with delivery services to 5,000 locations and has 0.5 million registered customers of which over 60 per cent are repeat customers.
First Published: Wed, February 21 2018. 23:21 IST