Our growth will not come at the expense of profitability: Ashwin Venkatraman, Furlenco
In a conversation with exchange4media, Ashwin Venkatraman, COO, Furlenco spoke about the company's initial days, brand proposition, go-to-market strategies, revenue growth expectations & scaling up
The seven-year-old online furniture rental platform, Furlenco has had a smooth ride this year, with the company crossing Rs 100 crore revenue mark, for the June quarter. Furlenco, founded by Ajith Mohan Karimpana entered the market when the concept of rental furniture was relatively new for India.
Furlenco now caters to 40,000 customers a month and has crossed 100,000 customer mark this year. The company’s services are available in cities - Chennai, Bangalore, Mumbai, Pune, Delhi, Noida, and Gurgaon. They are planning to further expand to 15 more cities.
“We started as an offline furniture rental company and the target audience were people who wanted to rent large bulky furniture for their entire home for a fixed duration. We had one store in Koramangala, Bangalore,” recalled Ashwin about the initial days of Furlenco.
He continued, “When we started we hardly had 100 customers. Today, we have around 40,000 customers who resort to our services on a monthly basis. We are planning to expand to 15 more cities in the coming years.”
Speaking about the scaling plans, Venkatraman said, “We have a very measured scale of plan. We are a full-stacked company that owns every part of the chain, from designing the furniture to logistics and delivery experience. Furlenco holds the entire brand and customer experience. So, when we expand to a new city we set up the entire chain.”
Maintenance of the furniture forms the crux of Furlenco’s business model. The furniture given for rental goes through an extensive refurbishment and sanitizing process. Furlenco follows the sustainability model.
“Our brand promise is that as a consumer you shouldn’t know whether you are using new or used furniture. Furlenco’s furniture is designed for refurbishment. Today a lot of furniture which people buy online is made for use and throw purposes; it is cheap and easy to manufacture. Eventually, this trend has to stop, because the government is going to get tougher about sustainability, and consumers will start getting conscious. Another major problem is the lack of waste dumping places in cities like Bangalore.”
Speaking further on the sustainability model of Furlenco, Venkatraman said, “Our entire brand proposition is based on the concept of sustainability. We follow a system design approach. When a customer returns the product, it goes through a mandatory refurbishment process. It will be sanitized and the damage will be assessed. We will do everything that it takes, to make that piece of furniture into a brand new one. The furniture also goes through a deep Q&C process. We have an in-house refurb team and our design team has invented the refurb process. Rental doesn’t mean it has to be old, the idea is to make it completely sustainable without compromising on the customer needs.”
Furlenco spends 100 percent of its marketing budget on digital media platforms. The company spends 15-20 percent of its revenue on marketing and advertising activities.
“We are very brand conscious. We started spending on digital mainly because we are an e-commerce company and we realized that digital helps us to get deep connections with customers quickly. We spend heavily on video-based advertising as well.”
Opining on the exploration of other mediums Venkatraman said, “Television has a certain reach that you can get exclusively very quickly, which might not be that easy with digital. Also, video advertising being a communication strategy, TV is something that Furlenco might look at in the future. We are not able to see any immediate connection with the traditional print medium.”
Millennials form around 85 per cent of Furlenco’s customer base. They have recently launched kid’s furniture which is targeted at the age group of 4 onwards.
Speaking about Furlenco’s Go-to-Market strategy, Venkatraman said, “We use digital to create category awareness, a brand which can empathise with the customer in the way they think. We have a channel partnership route to market, where we work with real estate brokers. We have around 5000 of them who are a part of our network.”
About revenue growth expectations Venkatraman said, “We have got into profitability. We started generating cash flow from operations which is positive and can start funding the company. We are growing on an average of 60-70 per cent year-on-year.”
“Our growth will not come at the expense of profitability. We will continue to grow at the same pace. Every 2 to 3 years, we should be able to triple the business. We will be launching new products and by 2023-24, we will be Rs 2000 crore company,” Venkatraman concluded.
WhatsApp, Instagram, LinkedIn, Twitter, Facebook & Youtube