As a market leader in the reverse logistics space, Reverse Logistics Company with its chain of branded stores, GreenDust, is expecting to reach a turnover of Rs. 300 crore this fiscal
MAHATHI R. ARJUN
“If I can save a fraction of goods from becoming scrap and turn them into something useful, then we’re doing both our consumers and the environment a service,” says Hitendra Chaturvedi, founder and CEO of New Delhi-based Reverse Logistics Company (RLC). RLC ensures damaged and rejected electronic goods have a second lease of life through its brand, GreenDust. GreenDust is RLC’s brick and mortar and ecommerce brand (Greendust.com) through which it sells these refurbished electronics ranging from TVs, mobiles, laptops, cameras, appliances etc. The Smart CEO last featured the company in January 2011, and since then the company has grown tremendously. From three value-added centres (warehouses where repairs take place), RLC now has 12 centres in various cities such as Delhi, Mumbai, Bengaluru, Chennai, Hyderabad, Cochin, Jaipur etc. So have the number of its GreenDust stores – from six to seven stores about two years ago, there are now 70 such stores.
“We now do exclusive agreements with OEMs (original equipment manufacturers) pan India, which was not the case earlier as we were doing pilots with them,” says Chaturvedi. RLC works with over two dozen brands and retailers including Haier, Samsung, Lenovo, Acer, Godrej, Videocon, Electrolux, Toshiba, Philips, etc. In June this year, RLC raised Series B investment from Vertex Venture Holdings and existing investors Kleiner Perkins Caufield Byers and Sherpalo Ventures that is being used for strengthening its technology, infrastructure, people, marketing and working capital. In fact, RLC has filed a copyright for its reverse logistics (RL) technology platform. “Our ecommerce platform has also grown dramatically, which is a mix of both B2B and B2C where franchises and dealers can use separate logins to place orders, and so can end consumers,” he adds. Chaturvedi is also buoyed about the good feedback he sees on review websites about his products that demonstrates to him that the quality and trust in GreenDust have increased.
While earlier it was a big task to educate brands about RL, Chaturvedi is now witnessing a domino effect. He’s also exploring the option for small and medium companies to be able to lease factory refurbished products while RLC takes care of the after-sales service. Another offer the company is coming out with next month is the option of paying through EMI. “We’re also seeing many ecommerce companies that want us to manage their backend since return management is a major pain point for them. We’re currently piloting with two such companies and I expect this trend to grow in the coming years,” shares Chaturvedi.
“ We’re also seeing many ecommerce companies that want us to manage their backend since return management is a major pain point for them. We’re currently piloting with two such companies and I expect this trend to grow in the coming years. ”
RLC’s revenue model consists of its two main divisions: service element for OEMs and retailers, and product sales through GreenDust. The service segment constitutes only a fraction of the product sales, which of course makes up a major part of its revenues. But Chaturvedi considers service as the heart of RLC. “Our four strands of DNA are the four Rs of the green movement – reduce, reuse, repair and recycle. We differentiate ourselves by looking at RL holistically and not just a sliver of it,” he says. Hence, he is not fazed by competition from small dealers, the grey market area or even organised RL players. Besides educating brands on regular basis about reverse supply chain, Chaturvedi’s challenge includes convincing the Indian consumer that refurbished products are great products too. “We’re in fact looking to provide a 10-year warranty on our products, which is not heard of before.”
This fiscal, RLC is targeting revenues of Rs. 300 crore from Rs. 50 crore two years ago. Though the return rate in India is only four per cent while in the U.S. and Europe it’s about 10 per cent, the domestic market for RL is growing. Chaturvedi wants to first consolidate RLC’s position in India and he will consider setting up in other emerging markets such as Africa and Sri Lanka in a year’s time. His effort is to constantly stay ahead in terms of product offerings, stronger service model and better quality. “We want to become a billion dollar company in five years time and a market leader in emerging markets,” he concludes.
- Affluence of Indian middle class for better products
- Smaller lifecycle of electronic goods
- Changing expectations of Indian consumers for quality
- With entry of MNCs, return policy becoming more customer friendly
THEN AND NOW
|Three value-added centres (warehouses); seven GreenDust stores||12 such centres; 70 GreenDust stores|
|Team of 100||Consists of 400 people|
|Series A funding from investors Kleiner, Perkins, Caufield & Byers (KPCB), Sherpalo and Reliance Venture Asset Management in April 2010||Series B investment from Vertex Venture Holdings, KPCB, Sherpalo in June 2012|
|Rs. 50 crore for FY2011||Target of Rs. 300 crore for FY2013|