Starting today we will be featuring reviews of most voted Indian startups that have been nominated at hotteststartups – The startup awards for innovative and successful businesses in India – jointly organized by Tata and NEN.
Currently at the top position is – The Loot – an offline startup (if you can call it so) company who sell branded clothing merchandize at highly discounted rates.
Jay Gupta has started his first retail store while he was in college. His first store of The Loot came up on Marine Drive Mumbai in 2004. Since then the number of stores went up to 45 across India. Busy with expanding his business Jay never bothered to complete his degree. From 1 to 45 in 4 (years). Even Ferrari would be feeling shy.
The Loot is a retail store, which sells branded clothes at a discount of 25%- 60%. The discount is not seasonal. It runs throughout the year. All famous brands like Nike, Reebok, Allen Solly can be found at the loot stores. Few questions might have cropped up in your mind already. Before you even think about it let me say this, what they sell is not fake, second handed or defective. Their strategy runs on two core strengths. Effective procurement and strong supply chain.
Loot has employed a unique concept of secondary market in the retail space. It created a pseudo secondary market by buying slow moving stock in other retail spaces in odd quantities and selling at a discount. Along with this they have requested the garment makers to make stuff from the left over stock of the branded apparel. This is their business model, low margin high volume.
The loot has an annual sales of 300 crores and planning to ramp up its stores to 100 by the end of this fiscal.
This model of secondary market is not new. It is made famous by overstock.com in US. Found in 1997 overstock sells the surplus and returned goods in their online store. Its competitors are Amazon and eBay. While overstock is an online only store, Loot is offline only store.
Loot faces several threats in the form of the fierce retail competition pioneered by Future Group. It competes with Brand Factory, Pantaloons and other retail stores. Loot still does not have a brand recall. They do not spend much on advertising. Having Gulshan Grover inviting you to loot is not very appealing. Loot is a potential take over target for the big boys if it goes public. Other major concern is the lack of online retail store and a website which is parked. This makes it hard for a brand recall.
Coming to the Loot’s startup status, Tata NEN has laid out their guidelines for what a startup is and is not. Based on those guidelines Loot qualifies for a startup. But, a store which already have 45 odd branches and which is planning an IPO next year and which has tried to offload 25% stake to a private equity does not qualify as a startup.
The Loot should step aside and let some other startup to loot. It is now enjoying a numero uno status in the competition.
If you would like to vote for The Loot then head over to Tata NEN and make your voice heard. You have to register for voting online. You can send an SMS: “ HOT 2” to 56767 (that is “HOT <SPACE> 2”)
