Pepperfry is India’s No. 1 Online Furniture, Home and Living Marketplace with over a whopping million customers! Pepperfry.com opened for business on 3rd January 2012 to give customers a wide selection of amazingly priced Furniture and Home merchandize. They provide a consistently great shopping experience for patrons seeking to spice up their home, it’s the Pepper that is honest and a fry that makes building your home ‘fun’! Revolutionizing customers’ access to affordable high quality furniture,
Uber Content’s Saurabh Sinha chats with the man himself, Ashish Shah, COO and Founder, Pepperfry.com.
Q: Tell us about how this business venture started and your association with it?
A: Prior to setting up Pepperfry I worked with large e-commerce companies, basically since the year 1999, I have been in the dot com business. Around 2011 e-commerce had already started booming in the country with new evolved categories getting launched. We thought that was the right time for us to explore and venture into newer categories which could be the future of e-commerce. Ambareesh and I worked with eBay at that time, post which we decided to set up Pepperfry.
Q: In your opinion what is the size of the target market?
A: The home and furniture market is around 20 billion dollars, out of which furniture is 40%. Out of this 20 billion dollars, 91% is unorganized and that’s where we see opportunities for large e–commerce companies.
Q: What milestones has your venture surpassed in its journey till now?
A: In the month of October 2014’ we announced 100 thousand items of furniture sold. I think that is the largest number sold by any company in the country in 2½ years’ time. It took us 2 ½ years to reach here and now we have again sold 100 thousand items of furniture in just 4- 5 months. I think our customers appreciate what we produce and sell on the site. As a company we believe we are the largest large item distribution company in the country today, distributing furniture items in 150 cities on our own and last quarter we shipped out furniture items to 480 cities in the country. That’s significant because no other company has ever attempted it.
Q: What made you select the managed marketplace model?
A: If you want to buy a bed you would want to see many beds before making a purchase. Hence we thought of building a managed marketplace because we wanted to guarantee consistent quality to our customers on Pepperfry. Each piece of furniture item is quality checked three times before it is shipped out; at the assembly stage, at the finishing stage and at the time it reaches our warehouse. We work with small artisans and craftsmen and therefore delivering consistent quality is our responsibility. Therefore, a managed marketplace model becomes very important for a home and furniture play.
Q: What are key customer trends that you are seeing?
A: So there is a trend emerging, with the invent of online players, people have got new choices which allows them to decide whether they want to make their living room contemporary, colonial, Indian ethnic or modern. Second is from Pepperfry stand point, we believe that what we are building is a market place where you have a piece of furniture for every home in the country! Now these options again were not available in the past. We have made that available in the country now.
Q: What are some new initiatives you are taking in the next 12 – 24 month time period?
A: We have built this company on two strengths; supply and distribution. We are distributing to 150 cities in the country and by end of this year we would be distributing in 400 cities. Our sourcing centres are in Jodhpur, Delhi, Mumbai, Bangalore and Kolkata. We are now going to expand in other furniture hubs like the North East, Pondicherry, Thrissur, Saharanpur etc. We already have 4 labels who contribute to around 35% of our business. Also with furniture as a category, building trust with the customer is very important. Today we already have an easy, frictionless policy on the site called the ‘30 Day No Question Ask Money Back Guarantee‘. We are also soon to launch a lot of studios across the country. These studios are manned by interior designers and architects who would help you choose the right furniture item on the site, and also help you with AutoCAD designs and mood boards.
Q: You provide artisan services to your customers, can you elaborate?
A: Today we provide carpenter services in 112 cities across the country; we call it a “6 hour carpenter desk”. If you call us before 3 pm you will get the carpenter on the same day as we work with around 200 carpenters across the country. We distribute on our own so all the items are delivered using the Pepperfry branded trucks; our employees are trained by us on not only lifting or handling the items but also to unpack them. They will also assemble it at your place by removing the packaging material, mopping up the floor and then moving out.
Q: What are the key challenges in your fulfillment strategy and how are you addressing them?
A: Every piece of furniture has a different dimension and requires different packaging. Therefore we started a corrugated box manufacturing unit. So today every piece of furniture item that you buy on Pepperfry is actually box packed, it not only improves the aesthetic of packaging but also the strength and the load ability in the container. On the distribution side we follow a hub-and-spoke model…all the intercity movement today is done through third party logistics providers, large surface transport companies and all within the city distribution is done by us.
Q: What are the key challenges in your customer service strategy and how are you addressing them?
A: The biggest nuance in the business is that as the number of transhipment increases the chance of damages goes up significantly. Our overall return rates and damage rates are less than 2 % which is unparalleled. We work a lot on customer feedback. So starting from what designs are not working, to what pin codes are not performing we do analysis on them and keep reading out listings that are not performing. We do monthly maintenances which ensure problems are weeded out.
Q: In which areas are you actively looking for partners? Why?
A: Expanding payment options is very critical for us. That’s one area we want to focus a lot on. So for example; cash collection centres, adding more EMI options, working with various banks and getting them activated, launching payment wallets, launching cash cards, all of these things are very core to what we do from the payment side. So that is one area we are continuing to look for more partners. There are partners that we look for in the technology space. For example, we have our own in house technology team, the website is built in house, and our back-end CRM etc. everything is in house. We are looking for partners who can help us build the right products on the application side, like augmented reality, etc. The third area where we look for partners is in distribution. We reach out to 150 cities today, when we need to distribute further we use third party logistic companies. So these are typically the three areas where we continue to look for partners.
Q: You are operationally based out of Mumbai. Are there plans of moving out?
A: Well, Mumbai is our head office, our entire customer support sits here, technology team sits here, product management and large part of category team also sit here. We have large operations in Jodhpur, Bangalore and Delhi with 11 distribution centres.
Q: Is there a large secondary market growing for used products? Are you looking at it?
A: Absolutely, especially for furniture if you are buying a new piece you need to create space in your home and therefore the things like exchange programmes are something that we are evaluating.
Q: What have been key lessons in your journey?
A: I believe that mistakes happen; you have to be best at managing those. Be accessible, you will find us on twitter, listening to customers. There are customers who write to us on how the packaging could have been done differently and we have adopted it.