Snapdeal's annual sales likely to touch Rs 6,100 crore
E-commercecompany Snapdeal, one of the top rivals to Flipkart, is likely to achieve annual sales, described in the online world as gross merchandise value (GMV), of Rs 6,100 crore ($1 billion) within the next two-to-three months, sources said.
Earlier this month,Flipkarthad announced it would touch the sales run rate of $1 billion much ahead of the target date. Both Flipkart andSnapdealhave been aiming for $1 billion GMV by 2015.
GMV is the worth of sales transactions on a website. E-commerce players calculate the annual GMV based on the monthly run rate.
Kunal Bahl, chief executive officer and co-founder of Snapdeal, declined to comment on the GMV target. However, sources indicated the company would reach the target way ahead of its 2015 schedule and might list in the US stock market within two years. Recently, Koovs, a fashion portal, became the first non-travel e-commerce website to list on AIM of London Stock Exchange. “Going for public listing right now takes away some flexibility that we need as a growing company in an emerging market. We will take some time before we do that,” Snapdeal’s Bahl told Business Standard. The company, a leading marketplace player as opposed to inventory-led format, was recently in the news for raising its fourth round of funds,'estimated at Rs 830 crore from investors led by eBay,
Snapdeal, launched in 2010, is expecting over 50 per cent of its sales through mobile by the end of this year and is looking at spending more aggressively in technology. At present, 35 per cent of its transactions happens through mobile.
“Rohit Bansal (COO and co-founder) and I continue to be the largest individual majority share-holders in the company after the latest funding,” said Bahl, while countering speculation on buyout attempt by eBay. Bahl, however, refused to share any information on eBay’s stake, which the market pegs at around 20 per cent in Snapdeal. However, some industry sources argued that eBay’s stake in Snapdeal was below 20 per cent because of US regulations. “If they (eBay) is anyway close to 20 per cent, Snapdeal’s finances have to be consolidated in eBay’s balance sheet according to US norms.“
Commenting on the next round of funding, Bahl said the company was well funded for now. The firm will spend the funds in technological innovations for sellers and expand its base of engineers. "We are hiring over 100 engineers from across the country. We will look at customer acquisition and expanding our seller base and make it increasingly simple for sellers to work with Snapdeal," said Bahl, who claimed the company had grown over 500 per cent from last year.
Meanwhile, fashion has become about 60 per cent of the Snapdeal sales unit from almost zero about 15 months ago, said Bahl. The largest category on the website-fashion - is growing by about 40 per cent month-on-month.
The company is not planning any private label, unlike competition. "We will never compete with our sellers. We don't think a private label is a bad idea, but we are not retailers but a platform for small businesses in India," said Bahl.
Furniture is another key category expected to expand on Snapdeal. Recently, Godrej Interio launched its new products exclusively on Snapdeal.