The Bengaluru based furniture e-tailer Urban Ladder has shut down three of its warehouses at its headquarters, in a move to cut further costs and speed up delivery. The company however, is looking to open more offline stores and by the end of next fiscal hopes to have over 25 of them in the country. The firm, which posted Rs175 crore in losses in FY16, continues to chase additional rounds of funding even as it gears to compete with multinational giant Ikea. “Profitability will be a big focus area for us, especially over the next 12 month, said Rajiv Srivatsa, co-founder & COO, Urban Ladder. “We started the journey to become profitable some 15 months back. We will reduce every cost head over time, as we look to increase our revenues,”Srivatsa said.
Urban Ladder had posted revenues of Rs54 crore in FY16. “We are continuously optimizing on supply chain and have reduced costs by almost two thirds in the last one year,” he said, adding that the company is in talks with investors to raise its next round of funds. With profitability now being the key word, there could be further trimming of the number of warehouses. Urban Ladder has a total of 22 delivery centers in India and will slowly be reducing capacity in its other delivery centers outside Bengaluru. In Bengaluru, it will deliver items straight from the fulfilment centre, as the company believes that it will speed up operations. Warehouses are used for safety stocking which is an important component of the logistics and supply chain, allowing it to maintain a pre-determined number of inventory items. They provide a central location for receiving, storing and distributing furniture across any city.
“One of our biggest priorities for the next two years is to expand our offline presence. We want to open about 8-10 stores by the end of this financial year and roll out at least 25 stores by the end of the next fiscal. The advantage of physical retail is that it also helps the brand, and you don’t need to advertise much on television.” Srivatsa said.
Writer: Ondrila S Sarkar