Electronics e-tailer MirchiMart believes niche players can survive in the e-com jungle; claims GMV of Rs 4Cr a month
MirchiMart India Pvt Ltd, the startup that owns and operates Mirchimart.com, a niche e-commerce site for gadgets, claims to be doing close to 10,000 transactions monthly, with an average size of Rs 4,000.
"Our first financial year (July 2012 to March 2013) ended with GMV of Rs 18 crore. For the past two months, we have been doing between Rs 4-5 crore, which means if we sustain this, we will do between Rs 50- 60 crore this year. But the target is to increase this to over Rs 100 crore," said Sudhir Saluja, co-founder, MirchiMart.
The Delhi-based startup was founded by Saluja and Punit Sindhwani in March 2012. Saluja has two decades of experience in retail industry and also runs an offline retail and distribution business of IT products. Sindhwani has also founded Paxcel Technologies, a Haryana-based software development firm. Both of them hold BE degrees in electronics from Mumbai University.
The company also runs retail stores/kiosks at strategic locations in the Delhi-NCR region, so it is basically following the hybrid e-com model. As of now, the company claims the site has around 3,000 products across categories including mobiles, tablets, mobile accessories, laptops and desktops. The company is also offering products (laptop backpacks, pen drives, etc.) under its own brand Chilbuli.
The site is getting close to 4 lakh visitors on a monthly basis, out of which 75 per cent are unique visitors. Early this year, the company also launched apps for the Android and iOS platforms. On an average, 70 per cent of the company's sales are happening online and the rest from offline stores. As of now, mobile, its biggest category, accounts for 60 per cent of its business, followed by audio accessories (speakers, headphones, earphones, etc.) and storage devices.
The company has five offices and the team size is 80. Apart from its own warehouse (Delhi), it also leverages the warehouses of its sister companies. The top three cities in terms of orders are Bangalore, Delhi NCR and Hyderabad. Its small logistics team handles orders in Delhi NCR. For other regions, it is using services of BlueDart, FedEx and Red Express.
Interestingly, while the site competes with larger players like Flipkart, Homeshop18, Snapdeal, etc., Saluja's other companies (San Computech and Tanvi Info Solutions) also act as distributors and suppliers to these companies. Till date, the founders have put in Rs 3 crore in the company and it is now looking to raise $1 million.
Letsbuy.com, another specialised e-commerce site that was dealing in electronics, was acquired by Flipkart.com in February,2012. Flipkart later pulled the plug on the site, after getting all of its (Letsbuy's) inventory on its site. The deal marked yet another consolidation move in the e-com industry, which has already seen a string of sites folding up in the recent times. Do you think focusing on a niche category can work, even if it is a hybrid model. Or is being acquired or shutting down the only logical trajectory? Share your thoughts.
(Edited by Prem Udayabhanu)