With new leadership, Zivame seeks a right fit to profitability
In fiscal 2015-16, Zivame registered an 84% increase in losses to Rs 54 crore on revenue of Rs 62 crore, according to filings with the Registrar of Companies. It had an inventory of Rs 40 crore.
Zivame's strategy to sell its brands both online and in brick-and-mortar stores will be key to achieving profitability, said chief operating officer Shaleen Sinha, who took over charge of day-to-day operations from chief executive Richa Kar this month.
"We want to be a women's wear brand and will launch new categories like active wear and others over the coming months. We will be breaking even by June 2018," he said.
Sinha added that the company's decision last year to transform from an online marketplace to an online brand will help it reduce cash burn by 60-70% over the next 18 months. "Our cost of customer acquisition will come down due to multiple channels and we will also revive marketing through TV commercials over the next month," he said.
In 2015-16, Zivame registered an 84% increase in losses to Rs 54 crore on revenue of Rs 62 crore, according to filings with the Registrar of Companies. It had an inventory of Rs 40 crore.
After raising Rs 250 crore from Zodius Technology Fund and Khazanah Nasional Berhad in 2015, Zivame, which used to sell other brands as well as its own online, liquidated most of its inventory, pivoted to retailing only its own labels and decided to sell offline as well through company-owned and franchisee run stores. Private label brands make for high-margin businesses due to better control over the supply chain. Online marketplaces Flipkart and Amazon India, too, have introduced their own clothing, small appliances and electronics brands.