Mumbai, Feb 21 (PTI) Pepperfry.com, the country’s largest furniture and home products marketplace, hopes to turn profitable next year with a GMV of Rs 2,000 crore, as it plans an aggressive expansion in its offerings as well as in physical footprint. Also Read - Chinese Hackers Targeted Serum Institute, Bharat Biotech, Claims Report by Cyber Firm
The six-year-old marketplace, which also sells other brands like Hometown, Godrej and Neelkamal among others, apart from its own private labels, has set a target of Rs 1,400 crore of gross merchandise value (GMV) this year. Also Read - Goldman Sachs Lowers India's GDP Growth to 1.6% Amid COVID-19 Lockdown, Predicts RBI Will Cut Interest Rates by 50 Bps
“We hope to become profitable in 2019 as we already are in cash profit and hope to touch a GMV of Rs 2,000 crore as we expect sales to improve under the GST regime,” chief category officer at Pepperfry Hussaine Kesury told PTI. Also Read - Do Not Keep Apple Card in Leather, Jeans Warns iPhone-maker
After the reduction in GST from 28 per cent to 18 per cent in November, he said the sales have improved and expects this to continue, helping attain the topline target by 2019.
“In fact, we have set a target of becoming a billion- dollar brand by 2020, given the overall momentum in demand,” Kesury said.
The city-based company is backed by big-ticket investors namely Goldman Sachs and Zodius Technology Find (a cumulative USD 100 million in series D funding since 2015), Norwest Venture Partners (USD 43 million since 2011 in three installments), and Bertelsmann India Investments (USD 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 6,000 crore 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.
This is published unedited from the PTI feed.