Aditya Birla Group’s online shopping portal abof.com aims at growing business by three times in the current fiscal which will help reach its target of achieving 15 per cent market share by FY2019-20.
“In the current fiscal (2017-18) we expect to grow our business by about three times from existing levels and expect a market share of about 10-15 per cent in the next three years,” President and CEO, abof.com, Prashant Gupta told PTI on the sidelines of India Fashion Forum 2017.
According to a PTI report: He indicated that in the last 12 months, abof.com’s gross merchandise value (GMV) in its peak month was Rs 25 crore, averaging to Rs 300 crore in 2016-17. Of this, its net revenues were about Rs 10 crore a month.
“While breaking even is sometime away we are not losing money on our orders, and have completed the last fiscal with very healthy order margins. This means we are able to recover the cost of servicing an order,” he told PTI.
Even if the business was to grow three to four times in size, the capital requirement will not grow, he added.
“Abof.com will concentrate on funding the brand building and overheads which give the business a more solid footing by not losing business on every order,” he was quoted by PTI as saying.
The company is not focused on discounting its goods, but for the next 3-5 years, they will have to continue some discounting to stay in the game, Gupta said.
“Unfortunately, the market is at a certain level and we have to discount to an extent to be seen as a comparable option to the consumer. Hopefully, that will change in the next 3-5 years,” he was quoted by PTI as saying.
He explained breaking even will take sometime because “its about getting to a reasonable sale after reducing the discounting levels prevailing in the market today.”
The online fashion store retails about 125 brands, and will bring Forever 21 to its stable in the next few months, Gupta was quoted by PTI as saying, “We don’t see any gaps in the range. If we add brands we will also delete brands, based on consumer insight.”
So far the company has been using digital medium to advertise, but in the current fiscal it expects to use mass media as well to build its brand.
The company has a stable attrition rate of 10 per cent and is not actively looking to bring more people to the team, he added.