Driven by the promise of profitability, Craftsvilla is on working hard to obtain profits in another 6 months. The etailer’s co-founder and chief executive, Manoj Gupta claims that the etailer will be building its food business through its food startup Place of Origin which it acquired last year. The ethnic marketplace wants to increase its revenue from its food and handicrafts businesses.
Gupta mentions, “There will be 20-25% increase in food and handicraft’s share of the next four months.”
At present the share of handicrafts and food businesses for the ecommerce platform is 10% and 5% respectively. Gupta also reveals that in the next 3-6 months he plans on making Place of Origin the largest ethnic food discovery platform in the whole country.
The revenue share of the apparel category is expected to shrink from 80% to 50% by Fy18, says Gupta. He also claims that the firm is preparing a clear mandate that enables it to focus strongly on new and existing verticals for a profitable marketplace.
“Building Place of Origin and out handicrafts business has to be profitable for us. That is the clear guideline,” he says.
Craftsvilla’s ethnic food startup curates and offers local specialties and ethnic Indian foods like:
These are available from 50 cities and approximately 250 brands. By FY18, the online marketplace intends to take these numbers much further. There will be a 10-fold increase in brands and 4-fold expansion into cities.
Gupta states, “We expect to feature 2,000-3,000 brands across 1,000 cities by FY18. By end of FY17, we expect food to form 7-8% of our revenue share.”
No need for new funds
The etailer says it has been able to reduce its burn rate by a great extent. All on account of its flat commission model of 25% across categories and average order value of Rs.1450.
Craftsvilla is not looking for fresh funds to expand its food and handicrafts ventures.
Gupta says, “We may need money for something else but for what we are doing, we do not need more money.”
He adds, “Our ratio of revenue to marketing spend has improved in the last six month by 4-5x. We have been able to cap our bur rate by 4-5x as compared to what we spend for marketing for a similar market.”
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