Citykart is a value fashion retail chain which is sharply focused on the needs of the burgeoning middle class in tier 2 and 3 cities. The company today is represented by 53 aesthetically-designed and conveniently located showrooms in 47 cities across 4 states including UP, Bihar, Nagaland, Assam. With an average store size of 8,000-13,500 sq. ft., the company offers clearly differentiated value to customers in categories including fashion, furnishing and general household articles. In an exclusive conversation, Sudhanshu Agarwal, Director, Citykart talks about the growth plans of the organisation.
What inspires you to launch Citykart? What were your initial challenges and how did you overcome those? Also shed light on your professional journey?
Coming from a family lineage of clothing business, I always had an inclination towards the fashion and retail segment. I have been in the industry for about a decade now and haveworked with private equity fund TPG Capital-owned retail business, TPG Wholesale (Vishal Mega Mart) and Vishal Retail Ltd. prior to launching Citykart in 2016.
Having spent many years in the retail segment, I observed the highly under-penetrated organised retail in tier-2 and tier-3 cities. We wanted to tap the untapped retail opportunities by opening modern retail stores across various small towns and cities of India and hence Citykart came into existence.Citykart aims to make fashion aspiration of customers in non-metro cities accessible and affordable.
There were many challenges like lack of skilled manpower, unorganised supply chain, unavailability of resources and inadequate distribution channels that we encountered in the course of establishment. However, with strategical thinking, hard work and dedication, we were successfully able to overcome these challenges.
Tell us about your business model and current distribution? Going forward, what are the plans to scale-up the distribution?
Currently, we are present in 47 cities with around 53 stores in 4 states namely U.P., Bihar, Assam and Nagaland. Next, we intent to set our footprints in Orissa. Our expansion plan also includes marking our presence in tier-3 and tier-4 cities by opening of 30-35 more stores. We have plans to tap the North-East markets too by opening new and more stores in Tripura and Assam respectively.
We completely operate in COCO model in the all states and cities we are present in.
Tell us about your funding rounds. How you are utilizing the raised money? Are you still scouting more funds?
Citykart grabbed the attention of some of the leading investors in the country including IDFC Alternatives and India SME Investments who invested Rs 100 crores in Citykart in 2019.
So far, we have utilised approx. 30% of the funds raised in expanding our footprints and product range. We are not looking to more raise funds immediately until and unless there is an opportunity for a consolidation.
Who do you see as your potential competition?
We believe that the market in tier-2 & tier-3 cities where we operate, is not yet fully developed. So when two or three brands in the same space enter the market, they collectively develop the market instead of competing with each other. However, if I were to name one, I would say V-Mart is a close competitor for us.
Tell us about your product categories. Going forward, what are the plans for category expansion?
We offer products under the categories of apparels and accessories like bags, sunglasses, wallets and footwear. We have recently launched our Spring-Summer collection comprising of trendy outfits in quirky prints and lively colours.Our focus is to establish ourselves as ‘Value Fashion Retailers’ only, hence, we have no immediate plans of expanding our product categories.
At last, kindly highlight your growth plans?
Our goal is to expand our footprints in tier-2 & tier-3 cities by setting up more stores. We wish to explore new markets in tier-4 cities too. We will continue to offer exciting products to our customers as per their fashion preferences in future.