Teesort turn profitable using traditional business model

Teesort, founded by siblings Atul and Alok Agarwal is India's first profitable online fashion brand, which has gained profits amid several small to big e-commerce ventures.
Teesort's magic mantra

Teesort, founded by siblings Atul and Alok Agarwal  is India's first profitable online fashion brand, which has gained profits amid several small to big e-commerce ventures.  This profitable upscale comes at a time when other brands are on the verge of closure or being sold amid drying funds.
Having plethora of brands available, this Rs 100-crore brand sells casual menswear under labels Teesort and TSX through its 15 online portals including its own. In spite of other brands in the same business like Yepme and Zovi, what sets Teesort apart is that it has embarked from nothing to Rs 100 crore online brand without running into losses or raising a penny from investors.
Alok Agarwal, 35, who left his job as an assistant director-corporate customer service delivery at Delhi-based telecom operator MTS group said that what worked for the brand was the business model and the traditional approach that they chose to build the brand.
Talking about online brands like Yepme, which registered a loss of Rs 103 crore in 2014-15, he said that while other online companies concentrated on acquiring new customers and spending on marketing heavily, Teesort mainly focused on selling more to their existing customers. The brothers first focused on vertical integration of manufacturing, branding and distribution of men’s wear. This helped the firm dominate a category and source high volume products at low cost.
Alok Agarwal, business head at Teesort said that every single transaction brought the company some profit margin. To notice carefully, entrepreneurial journey of twin brothers has not been a bed of roses. There were days when they had to take credit period from their partners and wait for orders to come across. In the initial months, the brothers would pack and deliver the products themselves to gain customer feedback.
Mr Agarwal recalled that the first order came from a student in AIIMS for a full-price Tshirt with Khula Saandh printed on it, which was an exciting moment. The technical back-end was laid down in France where Atul Agarwal, 33, was working as an information technology analyst with Tata Consultancy Services.
The e-commerce bang in the country motivated the twin brothers to look into the future of retail market in India. As per Mr Agarwal, during the time when Atul Agarwal was in France, every second ad was of an eCommerce company and fashion category was big. What reassured the brothers further was their experience with their relatives who came from smaller towns and often borrowed their clothes.
After cementing the back-end and mapping out the company's manufacturing, branding and distribution aspects, Atul left his job in France and came back to India in 2011. The brothers pooled in all their savings-close to Rs 50 lakh -and distributed its expenses over the next three years. Later, in 2013, after the company crossed the Rs 1 crore figures in sales, Alok left his job and stepped into the business full-time.
The brands run rate saw a profitable rise when they joined hands with another e-commerce portal in the same year. In 2013-14, according to the brand’s filings with the Registrar of Companies, it earned a turnover of Rs 6 crore and then 30 crore in the following year, with a 42% annual gross profit.
Alok Agarwal said that this fiscal year they will close at Rs 100 crore. The annual gross profit margin will be 40%. The company is now planning to venture overseas through multiple channels. It is in talks with Amazon for launch in the US and the UK markets, besides talking to potential local partners in West Asia for a launch in the region. Besides, the company plans to diversify into apparel for women and children this year.

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