Pepperfry: How two former eBay employees changed the online furniture game in India

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Article Index

1. Introduction

2. Establishing the online Pepperfry furniture marketplace

3. Initial challenges as the first online furniture market

4. What happens after you place your order on Pepperfry?

  • Two weeks to ship the product
  • Stringent check and control policy
  • Warehouses – Mumbai, Jaipur, Delhi
  •  Product is packaged
  •  Shipping is outsourced

5. Growing using their previous eBay experience

6. Pepperfry today

7. Conclusion

Introduction

Finding furniture has always been a strenuous task that involved finding the right type of wood, fabric, design, dimensions, and color. Now imagine, its 2012, online aggregator like Amazon was yet to foray into the Indian marketplace while Flipkart hasn’t made an impact on the market just yet. The significant portion of the ecommerce market, around 80-85%, constituted of the travel market in India during 2012. 

Despite having low demand in ecommerce yet, Ashish Shah and Ambareesh Murty, the founders of Pepperfry, saw the potential growth in the industry and thus became the pioneers of the online furniture marketplace at Pepperfry.com. What began as a furniture focussed ecommerce business selling Pepperfry beds, Pepperfry sofa sets, and Pepperfry wardrobes, today has marked their footsteps into the entire lifestyle section that include lighting, mattresses, decor items, and even an interior design Pepperfry studio section dedicated to modular kitchens, modular wardrobes, and room designs. The Pepperfry studio allows the customers to avail expert advice from interior design consultants to help pick what suits and reflect their personality best for their house. Here’s the story behind the pioneers of Pepperfry furniture

Note: The company started as a lifestyle and fashion website but changed its business model in 2013, turning into furniture-focussed online retail.

Establishing the online Pepperfry furniture marketplace

Pepperfry.com started as a horizontal online marketplace focussing on fashion and lifestyle. The ex eBay employees, Shah and Murty, worked as sales and operations head and country manager for India, the Philippines, and Malaysia, respectively, for over a decade. It was in 2011 that the entrepreneur duo decided to quit their day time jobs to turn into full-time entrepreneurs. 

The duo realized that there was a significant gap in the industry and the absence of a platform to cater to all our lifestyle deals. Shah and Murty ideated the whole business idea and decided to chip in equal amounts of funds to initiate their startup Pepperfry. Because of their vast networks, they were able to accumulate a small team for the company, even before naming the brand. The firm was relied on committed funding worth $ 5 million from Norwest, with no signs till almost six months after the agreement. The firm was on the verge of bankruptcy with only Rs10 lakhs left in their accounts when finally, the invest from Norwest came in.

After receiving the funding, the firm with a team of 25 started building out teams for sourcing and category management, with the marketing team joining them a little later. 

Note: The company was amazed to receive 1,400 orders itself in a few hours of launch due to affiliate based promotions.

Initial challenges as the first online furniture market

Ambareesh Murty AND Ashish Shah
Ambareesh Murty and Ashish Shah

In 2013, Shah and Murty decided to pivot into the furniture and home furnishing after seeing the increasing losses from their horizontal experiment. The Pepperfry furniture category, on the other hand, had the potential to coin enormous profits with margins going as high as 45% and Pepperfry coupons, Pepperfry offers, and discounts that weren’t as significant. Being the first online business to provide furniture online, the firm had to explain a lot to some of its customers. Many times, the customers complained that they received a second-hand piece instead of a new one to which the Pepperfry customer care took a lot of pain to explain that it was a vintage collection, which is why the furniture gave an older appearance.

Note: Pepperfry furniture business started with ten trucks for delivery and currently has 400 trucks for delivery that has reduced furniture damage to less than 1% due to distant deliveries.

What happens after you place your order on Pepperfry?

Pepperfry has made its mark in the furniture industry with its thriving ‘managed marketplace’ model, which closely works with a significant number of merchant partners to provide the Indian consumers and its consumers across the world with the best products showcasing the merchant’s design skills and craftsmanship. Pepperfry has also collaborated and partnered with brands like Godrej Interio, HomeStop, Philips, Raymond, Prestige, Tupperware, Whirlpool, and Morphy Richards for its wide range of products.

Once you place the order,

  1. After receiving and confirming your order, it takes the company over two weeks to ship the product.
  2. The majority quality check on the sourcing is done in-house from Rajasthan’s Jodhpur and Churu. The company maintains a stringent check and control policy.
  3. The company has warehouses located in 3 locations- Mumbai, Delhi, and Jaipur. 
  4. After a thorough quality check, the product is adequately packaged. 
  5. After the product is packed and packaged correctly, the shipping is outsourced to its trusted delivery partners.

Note: Pepperfry launched its first-ever TV commercial in 2014, with “Happy Furniture to You” as their unique brand proposition in collaboration with Satchi & Satchi. 

Growing using their previous eBay experience

Shah and Murty made full use of their eBay experience, whether it was in building the operating rhythm or the HR aspect. All the heads of the departments met every 15 days to deal with upcoming challenges. The company analyzed their weekly progress by figuring out solutions to the ongoing obstacles and even got weekly plans and reports from their teams each Friday.

The discipline helped to form the structure of the company and maintained the corporate culture. They would never skip a meeting and would always motivate their fellow employees and teams by understanding problems at their level.

Pepperfry careers also promote young talent and provide internships and jobs to young ones hailing from different backgrounds like furniture designing, interior designing, lifestyle marketing, and so on.

Note: One time in 2013, the company exhausted its funding. It was then that a team of 15 members in the top management decided to take 50% of their salary cut indefinitely so that the people at the junior level were not laid off. The 15 members are still a part of Pepperfry.

Pepperfry today

The Pepperfry team has grown from a small team of 10 to 500 today. The founders, Ambareesh and Ashish, believe that what has helped them raise the scale of success is the hard work and dedication of their team, which they call, the Pepperfry family. The startup has grown to raise $ 200 million over eight years in its business. The duo- entrepreneurs believe that if you think of the right strategy, you shouldn’t change it. 

Conclusion

Pepperfry has forayed into the offline business as well and has opened stores across India. Currently, the online ecommerce venture amounts for over 50% of the furniture industry’s market share and has maintained its spot in the market despite competition from various businesses like Urban Ladder, Amazon, and Flipkart.

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A passionate writer with bachelor’s in the field of English & Journalism. Other than being a bibliophile, some of her hobbies are travelling, photography and poetry.

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