Home Retail Furnishing a Success Story

    Furnishing a Success Story


    Kolkata-based Skipper Furnishing is a prominent player in soft furnishings in India, notching up revenues of Rs 27 crore (including the turnover of its wholesale company through which it supplies products to its own stores, franchisees and associates). Company officials say the brand has been growing 30–40 percent over the last couple of years.

    The home-and-kitchen furnishing market in India is worth around Rs 2,000 crore currently, 60 percent of which is accounted for by the bed-and-bath and kitchen segments. Skipper occupies 6–7 percent of the soft furnishing category in India, including products like upholstery, curtains, etc., says the company.

    Tanay Agarwal, Director, Skipper Furnishing, says they are making continuous efforts to organise this highly unorganised sector and hope to corner at least 15 percent market share in the near future.

    Talking about the brand’s retail model, he adds: “The product line we deal in is highly specialised, so we don’t get a large number of footfalls at our stores. Since there is very less scope for impulse buying, our conversion rate is high. We generate a footfall of about 200 customers each day, 80 percent of which end up purchasing something.”

    Off late, Skipper Furnishing has taken to the franchise medium to expand across the country. Currently, the company has only one franchised store, but three of the four new outlets that are opening soon are going to be run by franchisees. “The most important aspect that we look for in a franchisee is his commitment to work. Since furnishings is a highly service-oriented sector and very demanding, we want our franchisees to be involved in the day-to-day operations,” says Agarwal.

    Skipper Furnishing is bullish about expanding its retail footprint across India. Agarwal has plans of opening at least 50 stores within the next 2 years in the form of franchised stores, co-co stores and shop-in shop formats. Recently, the company also launched its e-commerce portal to provide made-to-measure curtains to customers – a first in the country.

    The home furnishings segment has a lot of growth potential. With increasing affluence, the desire for decorating homes is also rising and becoming something of a necessity. Talking about the change in the needs and desires of customers, Agarwal says: “There is a huge increase in the variety available for a customer. Previously, we could display just 100 SKUs in a 3,000 sq.ft. store, whereas today we display about 1 lakh designs in the same space! We have seen almost a revolution in our industry with a massive growth in cut-service which did not exist before. These days, most stores in the market just have samples and rely on other stockists who stock the goods for them. Consequently, the entry into the industry has become really easy as the investments are comparatively low.”

    Skipper Furnishing offers a wide range of products and makes an attempt to cater to most consumer segments. The company orients each store according to the unique customer profile of its catchment area. For example, its Park Street store in Kolkata displays higher-ticket products compared to the Gariahat store in the same city, while the Skipper outlet located in Hyderabad targets a much premium crowd than its store in Jamshedpur.

    Talking about the clientele, Agarwal says: “Most of the customers who visit our stores are women or interior decorators. We have a team to guide our customers on decorating their homes and try to provide customized solutions to them.”

    Product Range

    Skipper Furnishing offers products from a number of companies around the world. One of the biggest brands it sells is D’Decor, along with other international labels. In upholstery fabrics, Warwick is the name to reckon with. According to Agarwal, there is a huge demand for wallpapers from Omexco and Khroma. Skipper also offers wooden floorings. The product mix and range differs from store to store depending on the location and customer profile.

    Some of the categories available at Skipper stores include curtain fabrics, upholstery fabrics, wallpapers, wooden floorings, drapery rods, mattresses, carpets and rugs. Prices for curtain fabrics start from Rs150 per metre and go up to Rs 20,000 per metre. However, the price band of Rs 500– 1,000 per metre is the most popular. For carpets and rugs, this figure is Rs 8,000–20,000.

    Store Model and Location Strategy

    The average size of a Skipper Furnishing store is 2,500 sq.ft. The company is also working on a smaller format to increase its presence in the malls. The investment needed to set up a Skipper store ranges from Rs 20–25 lakh depending on the size and location. The basic format of most Skipper stores remains similar and the company tries to keep its outlets compact.

    In case of a franchise, this figure may go up to Rs 50–60 lakhs to account for the inventory costs. Says Agarwal: “We offer our franchisees a 40 percent margin on an average. It varies from product to product. We expect our stores to break even within a maximum of two years, but usually it doesn’t take more than a year. Out of our 11 stores, 10 are the profit-making ones. One store that was recently opened is not doing so well but we are trying to organise it better and plan marketing activities around it. We are confident it will pick up sales gradually.”

    Talking about selecting the right location for Skipper stores, Agarwal explains: “Furnishing is mostly a specialised retail segment and has a very small scope for impulse buying. So we feel that malls are not really suitable for our kind of stores. Malls might generate huge footfalls but conversions are really low there. Usually, rentals in malls are also much higher than high street. Though malls give recognition to brands, we feel this cannot justify the high rentals for a business like ours. Currently we are present mostly in the high street but we are trying to develop a more compact model for malls.”
    Total Combined Area of Stores

    FY 2010-11           FY 2011-12              Till Sep 2012 

    18,000 sq.ft.         27,000 sq.ft.              29,000 sq.ft.


    Total Sales of the Company (in Rupees crore) 

    Rs 22 Cr                 Rs 27 Cr                          –


    Sales Velocity (How total per sq.ft. Sales are going up for the Company)

    Rs 12,222                 Rs 15,000                        –

    Category Split at Skipper Stores 

    • Curtain fabrics 30%
    • Upholstery fabrics 20%
    • Wallpapers 15%
    • Wooden floorings 10%
    • Bed and bath 10%
    • Drapery rods 5%
    • Mattresses 5%
    • Carpets and rugs 5%

    Marketing Strategy 

    As an upcoming brand in the soft- furnishings space, Skipper Furnishing is currently spending heavily to market itself. The company is advertising in newspapers and FM radio programming and also putting up hoardings, sponsoring and hosting various events, and so on.

    Says Agarwal: “It is very important for a brand like Skipper to add a personalised touch to its products and make the shopping experience more pleasurable for customers. For the first time in India for home furnishing products, we have developed a touch- screen kiosk where accessory items such as bed sheets, shower curtains, door mats, and rugs will be displayed. With retail space getting more and more expensive, it is not possible to open huge stores anymore. Thus, we try to provide a huge variety of products to our customers through this technology.”

    Talking about keeping their customers happy, Agarwal says: “We make it a point to send gift items to our regular clients on occasions such as Diwali. We send them e-mailers too from time to time. Our marketing professionals in each store are in constant touch with customers. We have also recently started social media marketing. Occasionally, we host events for previewing our new collections where we invite interior decorators and our regular clients. Most of our marketing activity happens in the festive season from September to December.”

    Eye on the Future

    Like any other enterprising retailer, Skipper Furnishing has also launched a private label line at its stores. Agarwal says: “We do get our own range developed for home-furnishing fabrics. We also have our own brand in the name of Casa Floor for wooden floorings. We are planning to launch a house brand for bed-and-bath products as well. We have noticed that the sales split at our stores is usually 60:40 between our own brands and others, in favour of the former. This may be because of our competitive rates and the fact that we offer stores more margins in private labels.”

    Skipper Furnishing is also looking forward to the success of its newly launched e-commerce portal. “We have tied-up with big e-commerce players such as Jabong, Yebhi, and Snap Deal to sell our curtains and bed sheets. We are generating nominal revenue through this, but we expect it to rise significantly in the near future.”

    Top Performing Skipper Stores

    Location of Store: Russel Street, Kolkata

    • Catchment of customers: High segment
    • Date of start of operation: 1st November 1986
    • Total area: 3,000 sq.ft.
    • Rentals/month revenue share: Owned
    • Average monthly sales: Rs 1.5 crore
    • Average bill size: Rs 1,00,000
    • Average footfalls per day/month: 100–150
    • Velocity sales/sq.ft./month: Rs 5,000
    • Sales growth y-o-y: 35%

    Location of Store: Gariahat, Kolkata

    • Catchment of customers: Middle segment
    • Date of start of operation: 1st November 1995
    • Total area: 2,000 sq.ft.
    • Rentals/month revenue share: Owned
    • Average monthly sales: Rs 50,00,000
    • Average bill size: Rs 20,000
    • Average footfalls per day/month: 250
    • Velocity sales/sq.ft./month: Rs 2,500
    • Sales growth y-o-y: 30%

    Location of Store: Kankurgachi, Kolkata

    • Catchment of customers: Middle segment
    • Date of start of operation: 1st November 1998
    • Total area: 3,000 sq.ft.
    • Rentals/month revenue share: Owned
    • Average monthly sales: Rs 50,00,000
    • Average bill size: Rs 20,000
    • Average footfalls per day/month: 250
    • Velocity sales/sq.ft./month: Rs 1,700
    • Sales growth y-o-y: 30%

    Location of Store: Hyderabad

    • Catchment of customers: Upper middle and high
    • Date of start of operation: June 2002
    • Total area: 3,000 sq.ft.
    • Rentals/month revenue share: Rs 2 lakh
    • Average monthly sales: Rs 30,00,000
    • Average bill size: Rs 1,00,000
    • Average footfalls per day: 20–30
    • Velocity sales/sq.ft./month: Rs 1,000
    • Sales growth y-o-y: 30%