Interview with Priti International Limited

India lacked a centralised platform to display its handcraft to a worldwide audience, the situation is rapidly changing now, affirms Hritesh Lohiya, Co-founder, Priti International Ltd. 

What is your outlook on the international and domestic handicrafts industry? Also, in the post-pandemic world, what emerging trends you are witnessing among consumers?

Indian handicrafts are the embodiment of our country’s diverse culture and rich heritage. Not surprisingly, today, the handicrafts industry is very important to the Indian economy, revolutionizing the lives of millions of people around the country. Since it is one of the greatest job creators and contributes significantly to the country’s export. Handicraft exports are heavily influenced by state and regional clusters.

Undoubtedly, technological advancements have become the sole choice of survival for every industry, especially in such unprecedented times, and the handicraft sector is no different. Technology that allows people to communicate across borders has certainly benefited the handicraft sector. If one has a product to provide, acquiring a global customer is no longer a faraway possibility. E-commerce has paved the way for easy access to consumer goods, enabling inclusive growth by allowing producers from all over the world to promote their offerings on these online marketplaces. Even social media platforms are assisting in the global marketing of Indian handicrafts.

Although India's handicrafts have a small share of the global market, the overall potential for growing exports is significant as the global market grows. India lacked a centralised platform to display Indian handcraft to a worldwide audience until a few years ago. This situation is rapidly changing.

It wouldn’t be wrong to state that the handicraft business has enormous potential in both domestic and international markets as various statistics indicate. While artisans' fragile situation necessitates cautious involvement, the government has already made significant progress by enacting policies that will make handmade items more competitive globally and enhance the working conditions of our artisans. Hence, it’s worth noting that the industry is on track to grow in the coming years.

Can you shed some light on the products you have launched during 9MFY22 and new product launches in the pipeline for FY23?

Priti International has launched an eco-friendly furniture platform Pritihome.com which thrives on a zero-waste philosophy by creating & selling online coffee tables, bar cabinets, recycle ambassador sofas, tractor trolleys and even day beds from upcycle waste fabric.

New products for FY23, expect an affordable range of walnut coffee tables in ceramic, ash wood and stone gloss body; and study desks in solid ash wood finished with hints of light blue bonded leather. There are side tables in white marble, arm chairs, delicate glass-topped dining tables, and sleek metal and MDF consoles. Genuine leather or leatherette sofas with electrically adjustable footrests and ornamental mirrors in veneer walnut finishing complete the living unit requirements.

With widespread commodity inflation, input costs are surging across the board. Are you implementing any cost rationalization measures to safeguard profit margins?

While cost reduction strategies tend to vary between businesses, we begin creating our plan of action by following these simple steps:

1.Hiring remote employees reduces the cost of housing workers, workspaces, office supplies, and utilities.

2.Negotiate agreements with vendors to establish better payment terms and lower purchase order costs. It is crucial to keep the relationship mutually beneficial to avoid lowering the quality of goods.

3. We compensate employees for travelling to mandatory seminars, remote meetings, and other events, costing significant travelling fees. While not all travelling costs are avoidable, but we can eliminate unnecessary expenses, including overnight hotel stays, booking major airlines, and catering.

4.Implement management solutions. This automates repetitive tasks, reducing labour costs. For example, instead of hiring analysts to forecast future sales, businesses can utilize forecasting software that automatically generates projections based on historical and real-time data.

Can you shed some light on your current e-commerce strategy?

The mechanism to promote the growth of D2C e-commerce is related to the customer experience and hinges on the fact that to be economically viable, an e-commerce channel must rely on a set of core customers, since keeping a customer cost up to five times less than acquiring a new one.

We have identified three ways to drive recurring long-term relationships with customers: changing the business model to subscription, designing loyalty programs offering real value in return for loyalty, and/or establishing brand communities to connect with customers on a social and emotional level

Currently, what are your top 3 strategic priorities?

Practically speaking, only three basic business strategies exist: a cost strategy, a differentiated product or service strategy, and focus on a niche strategy.

What are your key growth levers?

There are six levers of growth. They all must be in operation at the same time. If even one is broken, the entire system falls apart. These growth levers are - awareness, acquisition, activation, revenue, retention and referral.

What is your earnings outlook for FY23?

We estimate our FY23 revenue would grow 40-45%, with an operating margin band of 21-23%.