Small-Town Startups | Lokendra Singh Ranawat: From London to Udaipur, trying to build an online furniture retailing startup

What started as an idea has, within a span of five years, become a chain of 26 stores across 17 cities and a full-fledged omnichannel retailing business that can compete with the likes of popular online furniture retailers Urban Ladder and Pepperfry.

Ranawat got his brother Virendra Singh Ranawat, a management graduate from IIMM Pune; cousin Dinesh Pratap Singh, an IIM Kozhikode alumni; and friend Vikas Baheti, who had worked with Dell, to join him as cofounders. Together they run Woodenstreet with the aim of providing quality furniture to the new generation of consumers across the country.

Starting up in Rajasthan

Startups are born across the country, but the ones grabbing the headlines are usually in Bengaluru, Mumbai or Delhi NCR. For any other entrepreneur, starting up could therefore mean relocating to Bengaluru or Mumbai.

For Ranawat, however, that was never an option, since the entire premise of the startup was based on his homecoming. He was comfortable building his company in Udaipur. “It helped being close to my artisans, who were creating all this furniture,” he explained.

Woodenstreet has 2 lakh square feet of manufacturing capacity with 70 percent of all the products made in-house. The company has built capacity to manufacture 1,000 beds per month.

The remaining 30 percent is outsourced to vendors, who exclusively manufacture products for the company. They include products such as carpets, lamps and other accessories to go with furniture.

Challenges aplenty

But building a company in a small town is not easy. From hiring the right talent, to being in touch with the larger ecosystem to staying relevant with the changing taste of consumers, challenges are aplenty.

“I have to travel extensively, and every month I am on the road, shuttling between Mumbai and Bengaluru,” Ranawat explained.

He takes time to attend conferences, startup events, and mingle with the top executives of the startup world. After all, for a founder, socialising is a key element and constant travel helps him achieve that. While Covid-19 disrupted his travel schedules for a short while, with flights resuming so has his work travels.

Further it also helps that Delhi is just a few hours away, ensuring that all big events in the national capital are part of his calendar.

Talent Acquisition and Investors

“With regards to hiring talent, we are very flexible — if they are not ready to relocate to Udaipur, they can join us in Bengaluru or Mumbai. We have satellite offices there,” Ranawat said.

While this remains a cost point for him, it also helps him attract the right set of talent. But Ranawat added that multiple engineers who might have worked with large IT companies are keen to work with Woodenstreet since they get to stay close to their families in Rajasthan.

Factors like lower cost of living and cheaper accommodation options along with a peaceful social life help startups like Woodenstreet from non-metro locations to get good quality talent at the right cost points.

Even if talent is something that satellite offices can take care of, meeting investors remains a concern. Most of the venture capitalists in the country are located around the large cities, even angel investors and the high networth individuals are based there.

“We have our first VC in Rajasthan and now we have received money from Indian Angel Network, so till date it has not been a major problem. But if needed I can travel to meet prospective investors,” he said.

Expansion plans

Furniture retailing cannot be done fully online; omnichannel is the way forward, feels Ranawat. Hence he is currently on a physical expansion spree. After having stamped his presence in Mumbai, Bengaluru and Delhi, he is now venturing into Kolkata and Kochi and eyeing opportunities in Coimbatore and Mysuru. “We follow the hub-and-spoke model for business. Every region has a major location from where we serve satellite areas around it,” he said.

Bengaluru is his base in the South, Delhi in the North, and Mumbai in the West. He has business in Gujarat and Rajasthan as well and currently delivers to almost all the locations in the country except for the North East and Kashmir.

The company recently announced that it is spending Rs 7.4 crore on its physical expansion plans. But multiple online retailers have burnt their fingers while expanding aggressively physically. Industry experts pointed out that furniture retailing is extremely expensive, especially when a single brand wants to expand pan-India.

Recently, when there was a buzz around Urban Ladder getting acquired by Reliance Industries for $30 million, sources pointed out that it was the former’s expansion into physical retailing that caused it the maximum stress.

But Ranawat is confident about his plans. He feels Woodenstreet’s in-house designs, handcrafted styling and the advantage of scale will put him at an advantage against local retailers. “We have some 100 designs of beds, something no one in the industry can match,” he added.

For Woodenstreet, the aim is to now create 50 stores over the next two to three years and eventually start expanding globally. The company is already getting orders from the United Kingdom and the Netherlands is on Ranawat’s radar.

Follow the entire Small-Town Startups series here.