SUGAR Cosmetics, which recently raised $50 million in Series D round led by the Asia fund of L Catterton, is ramping up its offline presence in a bid to grow faster. The said it is open to inorganic growth options and could look to go for an IPO in the next three years.
Vineeta Singh, Co-Founder and CEO, SUGAR Cosmetics told BusinessLine, “ We are sharply focusing on offline distribution expansion in line with our omni-channel strategy. Our products are currently available in over 40,000-45,000 retail outlets and we plan to ramp this up to 1,00,000 outlets by FY 24. We have been quite bullish on offline expansion in the past two years even during the pandemic and that has given us an edge over other D2C brands that are only now going for offline expansion.”
“ We firmly believe that young millennials and Gen Z do not think in terms of one specific channel. Brands that can offer a uniform offline and online experience seamlessly will dominate,” she added.
Focus on tier 2,3 markets
The omni-channel beauty brand is also strategically expanding its offline presence through its own stores. It currently operates 115 stores on its own and plans to ramp up this count to 200 stores by March end. “We are looking at the smallest cities to set up our own stores. We are looking at opening our own stores in the tier-2 and tier-3 markets to introduce our brand to new consumers especially in regions where we do not have a presence through modern trade stores and there may not be as much e-commerce penetration,” she added.
The company said it is on track to achieve annual sales of about ₹550 crore by the end of this fiscal. ”We expect consumer sentiments to be very positive over the next few months on the back of the festival season which sees very high demand for colour cosmetics,” Singh said.
Singh said that the company has taken price hikes only on certain SKUs and has largely been absorbing the impact of inflationary pressures. “We do have a war chest for acquisitions. But we will only go for an acquisition target that has strong business fundamentals. We will continue to evaluate options,” she said. The omni-channel beauty company could also explore possibilities for going for an IPO in the next three years, she added.