Royaloak Furniture Plans to Invest Rs 100 Crore in Two Years for Expansion
With real estate doing good, ancillary industries like the furniture segment are also doing good. The new-age customers are looking at functional furniture and space savers. Unlike the old times, many are willing to change their furniture, says Vijai Subramaniam, chairman and founder of Royaloak Furniture. The company has plans to invest about Rs 100 crore in Telangana in two years, he tells B. Krishna Mohan
Excerpts:
Plans for Telangana
We are having 23 stores in Telangana State out of which 20 stores are in Hyderabad and rest in Nizamabad, Khammam, and Warangal. These are franchise stores. The market is growing for us. We saw about 50 per cent growth this year in Andhra Pradesh and Telangana region. We are planning to add five more stores this financial year in Ameerpet, Gachibowli, Panjagutta, Kondapur and Nagole. Telangana's contribution to Royaloak Furniture is the second highest. Home decor sector is growing very fast. We will invest 100 crore in two financial years. However, Rs 15-30 crore will happen in the last quarter. That will depend on how many stores we will open in the March quarter. We are planning to add 400 more employees here in Telangana. The focus is also on to expand our business via the franchise route.
Customer preferences
Trends are changing continuously. Customers are looking for smarter furniture like space saving sofa-cum-bed, motorised recliners, diwan-cum-bed and coffee tables. We introduced the recliner concept and people started buying more recliners as we provide them at sofa prices. People prefer buying from international collections, especially American and Italian.
Are products imported, or assembled in India?
We do both. Majority of the products are imported from 400 factories across USA, Italy, Malaysia, Indonesia, China, and Vietnam. Some of the furniture is assembled in India and again exported to these countries. The company’s effort is to elevate the customers’ lifestyle to international levels at affordable prices. This is one of the reasons why we are growing 50% more every year. The average spending per customer has increased to Rs 65,000.
Materials use and recycling
Majority of our furniture is made of oak. We use American oak, Italian oak, and Malaysian oak. We also use Indian teak, rosewood. Apart from that, for modern furniture we use engineered and compressed woods. Apart from the wood, every material we use is recyclable. We also use recyclable foams for some of our chairs and sofas, making them environment-friendly. About 90% of our products come from abroad.
Lifespan of furniture
Nowadays, customers come back quicker as opposed to earlier when they came back once every three to four years. Trends are changing now as customers are looking for a better lifestyle and change their furniture accordingly. Customers are now changing their products every two years. We provide a warranty ranging from 5 years to 10 years. They can use the furniture for 10-20 years but 50 per cent of the customers want to change their furniture in two or three years.
Growth drivers
Real estate is booming now. We have seen good growth in the last financial year. Office furniture has started selling well because Hyderabad is an IT hub and our growth is huge. We have seen 70 per cent growth in office furniture in Hyderabad itself. We have already tied up with some real estate developers and more are in the offing. We will supply furniture for their apartments.
