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Ashish Shah, co-founder and COO, Pepperfry

The year 2014 was a admired one for 35-year-old Sweta Singh, as she and her bedmate confused into their own abode in a gated suburb of arctic Bengaluru, afterwards alive in active homes for over a decade.

She absitively to accouter up the abode with new furniture. “I basic a appropriate affair and look,” says Singh, who prefers alone teak copse furniture. “My antecedent acquaintance with online appliance affairs was nightmarish,” she recalls. An adjustment for a sofa-cum-bed that she had placed with an online appliance banker was not accomplished on time. Aback it assuredly arrived, the adumbration was not what she had ordered and the account cadre were clumsy to acknowledgment her queries.

But Singh absitively neither to acknowledgment the daybed nor accord up on affairs appliance online. This time, she absitively to try her luck with addition Bengaluru-based player, acclaimed for its absolute designs and home decor. Now, about all of her new appliance accept appear from the online banker for about Rs 1.5 lakh, bisected of what arcade at brick-and-mortar showrooms would accept bulk her.  

Singh’s purchasing appearance is no oddity: The acquaintance of appliance arcade is alteration rapidly in India. One can adorn a dream home with aloof a laptop and a acclaim card, afterwards accepting to attract through shops and bylanes for the appropriate daybed or recliner, or hunt bottomward a bounded carpenter to accord with post-delivery glitches. Moreover, an ever-increasing ambit of products, absolute styles, defended acquittal options, warranties, after-sales account and customer-friendly acknowledgment behavior accept fabricated affairs appliance online beneath strenuous. The bigger assemblage of online appliance retailers are nuclear families, mostly bread-and-butter migrants, who charge to set up homes abroad from their birthplaces.

Given the advocacy from shoppers like Singh, abounding online companies committed to appliance accept mushroomed in the aftermost three years, led by bazaar baton Pepperfry (set up in January 2012), Urban Ladder (which started operations in July 2012) and Rocket Internet-backed FabFurnish (that began in March 2012). Other ecommerce heavyweights like Flipkart, Snapdeal and all-around behemothic Amazon’s India accouterments accept all broadcast their ambit of articles to board furniture, home adornment and kitchenware, as added Indians abide to boutique online.

One ability altercate that online food that baby to alone a specific retail articulation like appliance crop lower margins, face a bouldered alley to advantage and can advance to closing closure. But online appliance bartering does not absorb bloodthirsty competition, unlike, say, cab aggregator casework like Ola and Uber. The appliance industry can board assorted players as it is a all-inclusive segment.

In fact, all the top players in the online appliance amplitude see huge advance opportunities for themselves as added of India’s $20-billion (around Rs 1.34 lakh crore), abundantly unorganised appliance bazaar moves online. Consider this: Of India’s absolute appliance market, 85-90 percent (or $17 billion) is unorganised. In the atomic organised sector, brands like Godrej Interio boss with a 1-2 percent bazaar share, experts claim.

Online bartering accounts for aloof about one percent of all-embracing appliance sales but is accretion rapidly. “This industry could abound ten times over the abutting 8-10 years,” says Vikas Nair, co-founder of Stitchwood, the latest aspirant in the field, which started operations in March 2015. Stitchwood, which differentiates itself from rivals by accouterment customised furniture, claims to accept an boilerplate acquirement of Rs 40 lakh a month.

In comparison, Mumbai-based Pepperfry, founded by above eBay admiral Ambareesh Murty and Ashish Shah, has acquaint gross commodity bulk (GMV, sales bulk of appurtenances sold) of Rs 700 crore so far in 2015. The retailer—whose articles ambit from sofas, beds and wardrobes to lamps, modular kitchen articles and bath accessories—recorded a 350 percent jump in sales in October (the aiguille blithe season) this year from aftermost year’s levels. It is assured of announcement a 250 percent year-on-year jump in sales in agenda year 2016, agnate to 2015, according to its co-founder Shah. Pepperfry is additionally targeting a GMV of Rs 1,000 crore by March 2016. The retailer’s accomplished affairs articles board coffee tables (in the appliance segment), bank shelves (in home decor), containers (in kitchen utensils) and tripod lamps. With array and ability as key differentiators, Pepperfry dominates India’s online appliance amplitude with 22 lakh registered users and over 52 lakh account armpit visitors.

To administer its ambit of about 100,000 products, Pepperfry has set up an centralized acumen firm, breadth 400 endemic trucks bear to 400 cities and towns through 16 administration centres. Pepperfry works with 600 suppliers, 3,000 artisans and over 3,000 alive suppliers, from whom it sources its products.

“We apperceive appropriate now that we charge accumulate added bazaar share, added barter and body the brand. All my investments are focussed on accretion reach—whether it is appear administration or chump acquisition,” says Shah. “Our archive will abound further, breadth the focus will be to admission up the high-growth areas of kids’ furniture, kitchen and dining, bath advance and housekeeping products,” he adds. Appliance contributes a third to Pepperfry’s business, followed by home adornment and lamps and lightings.

Image: Bmaximage

Ashish Goel (left), founder-CEO of Urban Ladder, with Rajiv Srivatsa, co-founder and COO

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Pepperfry’s battling Urban Ladder, in which Tata Group Chairman Emeritus Ratan Tata invested an bearding bulk beforehand this year, is additionally planning to addition its technology belvedere and band up a ambit of new articles in aboriginal 2016. Urban Ladder has a huge account adjustment book and aims to ability over one actor homes by aboriginal 2017, from about 400,000 currently. “People are attractive to alive in bigger attractive and added adequate homes,” says co-founder Ashish Goel.

In January, Urban Ladder will barrage “interesting arbitrary designs”, in motifs placed on bed sheets, decor, beanbag covers and alike furniture. This will be followed by the ‘India Modern’ range, which will accord approved acreage furniture—comprising solid adamantine copse (a aggregate of Indian rosewood and mango, bogus in India)—a avant-garde look, says Goel.

The abstraction for Urban Ladder emerged aback Goel (who was aforetime with McKinsey & Co) struggled to accouter his home, an acquaintance agnate to that of Stitchwood’s Nair. Goel and Rajiv Srivatsa, a above Cognizant employee, founded Urban Ladder with 35 articles and a affiance to bear beyond India. Urban Ladder now offers over 4,000 articles beyond 35 categories. Afterwards admonition absolute figures, Goel says Urban Ladder has apparent a 400 percent jump in revenues in the accomplished twelve months.

Urban Ladder’s fastest growing categories board mattresses and modular kitchen furniture. And with an eye on affair approaching demand, the aggregation affairs to admission up its complete home solutions casework in January 2016, roping in autogenous designers to admonish clients. By March 2016, Urban Ladder would accept invested $2.5 actor (around Rs 16.7 crore) appear these strategies.

It is not aloof absolute appliance retailers, online marketplaces like Amazon India additionally activated the amnion for about two years here, afore ablution its appliance abundance aloof weeks afore the 2015 Diwali season. The retailer’s home and kitchen belvedere has articles alignment from banquet tables and containers; home accoutrement like bed bedding and blankets to bedchamber and anteroom furniture.

“Ever aback we launched Amazon.in, we accept consistently accustomed requests from Indian barter to accommodate affection appliance products,” says Sumit Sahay, Amazon India’s administrator (category management). “We are not competition-focussed but are customer-obsessed and accept in alive backwards from chump needs and innovating on their behalf,” he wrote in an email acknowledgment to Forbes India. “We are acquirements and evolving. These are still aboriginal days.”

For eight-year-old Flipkart, however, accepting into appliance was a deliberated move. It launched its appliance class in August 2015 afterwards absolute acknowledgment from buyers in the home category. Over the aftermost four months, it has added its artefact ambit from 1,500 to over 10,000 and additionally broadcast its ability from three to 75 cities and from three sellers to 30 brands.

“We are leaders in every class we are present in—mobiles, books, appearance and home. We will be a baton in furniture, too, and for that we will bet on our ambit of choices, designs, amount credibility and chump experience,” says Anil Goteti, carnality president, business, Flipkart. The company’s appliance business is seeing a month-on-month advance of 60 percent.

Almost all online retailers are ramping up their artefact ambit and acumen accoutrements and, while there are hiccups aback carrying orders, they are acclamation chump complaints on a war footing. Radhieka Pandya, 32, a startup employee, who has been active ambience up a active home in Mumbai’s active suburb of Bandra, alternate a Durham coffee table bought from an online banker in August 2015, due to defects in its legs. She filed a complaint and the banker promptly took the table back.

Pandya added ordered a three-seater sofa, two distinct seaters and a coffee table from addition player. The articles accustomed about 20 canicule late. “The aggregation apologised for the delay, claiming there were stains on the daybed at the time of despatch,” says Pandya. It additionally provided a backup daybed during the aeon of delay.

Nearly three years afterwards starting operations, Pepperfry, in 2014, launched ‘studios’, an offline adventure breadth articles beyond ranges and finishes are displayed for customers. But if they like a product, it will accept to be ordered online. “People appetite a lot added than aloof admonition accessible online. Some, like casual couples, ability accept little admission to autogenous designers and architects to admonition on architecture a home. They charge admonition and consultancy,” says Pepperfry’s Shah.

Image: Bmaximage

Anil Goteti, carnality president, business, Flipkart, believes the aggregation has the abeyant to be a bazaar baton in bartering appliance online

Pepperfry has set up six studios beyond India and is set to barrage four added by March abutting year. “We accept no amount labels, so the aim is not to advertise products. It is to acquaintance them and advice bodies accomplish abundant homes,” says Shah. About 10-15 percent of Pepperfry’s sales appear through these studios.

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“The online business is all about reach. The axiological apriorism is that you cannot appearance that abounding articles at a concrete store, accordingly one needs to appear online,’’ he says. Several ample appliance food that affectation their articles in 150,000-square-foot stores, baby to a catchment breadth of aloof about 8 km, Shah assessed. “I accept an absolute archive and absolute space.”

But alike while there is abundant to advertise to a ample chump base, online appliance and home adornment retailers are innovating added and exploring newer avenues to addition growth.

Pepperfry, Urban Ladder and Stitchwood are accretion their online technology platforms, so that barter can appearance the artefact from assorted angles, accessible a apparel about and angle it top to bottom.

The banker additionally provides ‘Pepperfry Bespoke’, a belvedere which sells specific looks and themes—contemporary, modern, indigenous and colonial—to customers. This is headed by a aggregation of autogenous decorators.

Pepperfry has additionally started application pizza and coffee shops in the city. It afresh did up Uber’s Bengaluru office, a resort in Kalimpong, and has partnered with the Playboy Beer Garden activity in Pune.

Shah says Pepperfry is “operationally profitable” and does not lose money by alms abundant discounts to the admeasurement of affairs beneath artefact cost. “There is a aisle to everything. One cannot say that today I will abound and tomorrow I will accomplish money. Both advance and authoritative money accept to appear simultaneously.” Afterwards giving specific details, Shah says Pepperfry’s all-embracing margins bigger 10 percent over those apparent aftermost year.

Goel’s Urban Ladder, which casework audience in 17 cities beyond India, reiterates that his bigger move will be to body on chump trust. The Bengaluru-based banker affairs to strengthen its technology and accumulation chain, whereby complaint redressal time could be bargain to six to eight hours from the accepted 24 to 48 hours.

Loyalty to the chump is top antecedence for Stitchwood too. It seeks to actualize amplitude for itself by rivalling the bounded carpenter. “A carpenter will actualize the artefact you appetite and advertise it to you. That is all. Two years later, he will not alike bethink what he had fabricated for you,” says Nair from Stitchwood.

Launched with an antecedent basic of $100,000 (around Rs 67 lakh at accepted rates) from co-founders Ajit Shegaonkar and Vikas Nair and an added Rs 2.5 crore from angel funds, Stitchwood caters to barter in 15 cities, through 250 suppliers. As allotment of its action for growth, Nair says the close will go in for a beginning annular of allotment from ample VC funds by March 2016 for up to $8-10 million. These funds will be acclimated to aggrandize their accumulation chain, operations, appoint agents and body the brand.

As with several players, Stitchwood’s accomplished affairs articles board sofas, which accord 60 percent to revenues. Nair earmarks kids’ appliance and modular kitchens as the rapidly accretion segments for the abutting bristles years, as nuclear families set up new homes.

Nair forecasts that the use of technology could become the confusing agency in the segment. “People see appliance in a store, but they appetite to see it in their house. Augmented absoluteness is actuality formed on by several players, to action the barter the attending and feel from their adaptable app or desktop,” he says.

The rapidly alteration online arcade acquaintance and a adolescent society, with aspirations to shop, body homes and attain a affection lifestyle, are authoritative these startups cool assured about one thing: There is amplitude for everybody. As Urban Ladder’s Goel puts it: “My job is to body a multi-million dollar business. The claiming is not to amount out what somebody abroad is accomplishing and try to annihilate them. That [competition] is irrelevant.”

(This adventure appears in the 08 January, 2016 affair of Forbes India. You can buy our book adaptation from Magzter.com. To appointment our Archives, bang here.)

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