Wakefit has products ranging from pillows, comforters and beds, apart from mattresses. The company makes its products in its own factory.
The Indian mattress and sleep industry has been traditionally dominated by unorganised players and a few big legacy brands such as Kurl-On and Sleepwell. But in the past few years, some startups started entering this space with the belief that the industry in its current form suffers from ambiguity and lack of awareness regarding products, materials and technology. This, coupled with the popularity of e-commerce, provided a perfect environment for these companies to grow.
When Ankit Garg and Chaitanya Ramalingegowda started Wakefit in 2015, the largest e-commerce platform in India—Amazon—didn’t have a mattress category. With Amazon as its only sales channel, Wakefit initially sold six different types of mattresses. Then the duo settled on two SKUs which worked the best with their customers— memory foam and normal foam. By the end of the first six months, they were getting three to four orders a day, after which they fully established Wakefit as an online retailer.
Wakefit currently has products ranging from pillows, comforters and bed, apart from mattresses. The company makes its products in its own factory. Products are priced from `5,000 to `23,000.
Ramalingegowda says Wakefit’s products are 40-50% cheaper than a similar product from any of the large brands. “Typically, large brands have a distributor, a dealer and a retailer. We have been able to cut on that. Second, we are constantly reengineering the product and the cost so that it has the same 10 or 15-year warranty but quality improves,” he said.
Last year, Wakefit was able to maintain a 15-17% Ebitda margin with this year’s figures at the same level. Last year, revenues totalled `81 crore and this year till now it has a run rate of around `12 crore. Its biggest investment is in adding more machinery to expand production and creating more content for marketing.
“Market share of unorganised players is expected to drop drastically in coming years. The Indian mattress market, which is tightly in the grip of the unorganised sector led by the street-side shop and the local ginner, is fast shifting towards branded mattresses,” Research and Markets said in its latest report on the segment.
Online furniture retailer Pepperfry recently ventured into the mattress segment through its private label, Clouddio. Pepperfry aims to launch 30 Snooze studios by end of the fiscal. Other startups such as SleepyCat, Sunday and Cuddl also compete with Wakefit. But Wakefit has seen strong investor interest. It raised $9 million in its first funding round led by Sequoia Capital in December last year.