1. Pepperfry building growth
Presented by the University of Glasgow:
Mara Hilmy, Sarah Henkind,
Wes Treiber, Vijay Bidnurmath

2. Executive Summary Current problem Solving this problem
Pepperfry is searching for new revenues while fighting off competitors to maintain market share.
Solving this problem
By exploring the value chain we believe we can create unique value to customers that will fuel future growth.
Defining Success
We will measure success by evaluating conversion rate, revenues, brand sustainability, and gross product margin.

3. Agenda Introduction Key Issues Analysis Alternatives Recommendations
Implementation
Justifications and Questions

4. Defining Pepperfry
Pepperfry is an online retailer focused on delivering quality products quickly to the image conscious home owner.

5. Who is our customer Focused Customer Unfocused Customer
The younger generation of Indians who have new disposable incomes
They see them selves as early adapter and tech savvy
Unfocused Customer
Roughly 350 million internet users
Less trusting of online shopping but still have growing needs to furnish homes

6. Competition Vertical Pepperfry IKEA Durian Home Town Godrej Interio
RentMojo
Rentickle
Offline
Online
Big Bazaar
MORE Megastore
Flipkart
Amazon India
Horizontal

7. Alternative 1 Pros Push manufacturing in-house: Cons
Longer reduction in costs
More control in quality control
Inventory
Helps build brand recognition
Cons
Increase in fixed costs
Large initial investment
Lost of trusted suppliers
Push manufacturing in-house:
Moving away from selling outside brands and focus our manufacturing efforts on in house brands
Focus would be on popular furniture and décor brands

8. Alternative 2 Pros Stop external deliveries: Cons
Average 250% increase in profit from online sales
More control over value chain
Less likely to have
Cons
Increase in fixed costs
Large initial investment
Moves away from core competencies
Stop external deliveries:
Push to have control of our own fleet and move away from external shipping online sales to customers.

9. Alternative 3 Pros Build after sales service: Cons
Builds company trust
Solidifies customer loyalty
Opportunity for further personalized service
Cons
Cost of acquiring carpenters
Assessing quality of carpenters
Requires more personnel controls
Build after sales service:
Create a network of follow up and installment service of local “Pepperfry Certified” carpenters.
Utilize their in house assembly and service to build a better understanding of customer needs.

10. Analysis of alternatives
Alternative1
Alternative2
Alternative3
Conversion Rate
Increase Revenue
Brand Sustainability
Gross Margin %

11. Command and Control Strategy
Recommendations
Command and Control Strategy
30 new carpenters
30 new drivers and trucks
Select 20 best suppliers

12. Improves vertical control of product quality and variety
Manufacturing
Extend loan of 5.5mil INR to 20 best suppliers to be exclusive to Pepperfry
Improves vertical control of product quality and variety

13. Inbound Logistics Renting a warehouse Kolkata, to keep cost down
Extend into new market in the North East, 4th largest city in India
Improve procurement and delivery costs

14. Outbound logistics Buying 30 trucks and hiring 30 drivers
Find and 30 new carpenters to assist with final assembly of the product
Flexibility and agility for delivery

15. Sales and Marketing Continue organize growth through existing channels
House brand will sell with improved margins
Focus on content marketing online and offline

16. After sales and Service
Create an extension of Pepperfry’s online and mobile application
Hire a new team of carpenter to support after sales activities
Initially only focused on 3 new cities
Would create trust, loyalty, and ensure repeat customers

17. Break-even projection

18. Timeline Year 1 Year 2 Start post sale service Year 3
Roll out new drivers
In house manufacturing ready for delivery
Year 3
Review and evaluate process
Look to extend roll out to other cities

19. How we define success Increase conversion rate Increase revenues
Convert online view and clicks into sales quicker
Increase conversion rate
Locate new sales channels and leverage service to increase purchase amount
Increase revenues
Grow while maintaining current customer base
Brand sustainability
Focus on home furnishings and décor
Increase gross margin on merchandise

20. Thank you, Questions Presented by the University of Glasgow:
Mara Hilmy, Sarah Henkind,
Wes Treiber, Vijay Bidnurmath

21. Back-up Figures Inhouse Manufacturing Total Suppliers 20.00 Total Loan
100,000.00
Total Costs
2,000,000.00
Inhouse Delevery (Pep-Kart)
New Nodal (Kolkata)
50,000.00
New Trucks + Driver
1,800,000.00
Caprpenter Network
450,000.00
2,300,000.00
After Sales
Internet Application
Carpenters
200,000.00

22. Ecommerce reality check
Currently E-commerce accounts for roughly 10% of the overall retail market
Most generous estimates see this number peaking at 20% over the next 10 years
The larger the sale price the less likely an individual will buy online
Large catalogs create analysis paralysis