Six lakh square feet, 230 machines, lots and lots of wood, and the capacity to produce Rs 1,500 crore worth of home decor per year in three shifts. In a nutshell, that is what Wakefit’s brand-new factory in Hosur is all about.
The Bengaluru-based “sleep and home solutions” startup, known for making low-cost, easy-to-assemble home decor, has opened its new plant in order to backward-integrate operations. This coming-together of various processes, in turn, allows Wakefit to make and deliver furniture that it claims will come at half-price when compared to offline marketplaces.
“We are almost 40 to 50 percent cheaper than them, and the whole credit goes to the amount of waste-saving we’ve done,” says Ankit Garg, Co-Founder and CEO, Wakefit, “Traditionally, in the wood industry across the world, nearly 65 percent of the wood goes to waste when you convert a log from a tree into a final piece of furniture.”
To get around this problem, Wakefit’s team of engineers re-oriented its engineering processes, took inspiration from the automobile industry, and introduced machinery to save 40 percent of wood waste. “This translates to a lot of savings, which we pass on to the consumers,” Ankit adds.
The startup opened the plant with an investment of $20 million, spent across 18 months, half of which time was spent just building the plant. “That took a lot of effort towards perfecting our shop floor design, automation, machinery, skilling and training,” says Chaitanya Ramalingegowda, Co-Founder and Director at Wakefit.
Today, the factory can produce 5,000 beds, 3,000 dinner tables and 2,000 sofas every day. A collection of robotic arms, roller belts and even tiny rails across the plant’s expansive floor space add to the seamless furniture-making and value-engineering. While typically processes like the sourcing, moving, cutting, drilling assembling and shipping of wood as furniture is done manually, these simple innovations are built and designed, like Ankit explains, to serve just one purpose — cut down waste.
The backward integration and automation could well see the company record a 60 percent spike in FY23 revenue. “Last year, it (revenue) was Rs 636 crore; this financial year, we are targeting about Rs 1,000 crore,” Chaitanya says, “At the same time, we are trying to see how to keep the growth rate of 50 to 60 percent up even on such a large base.”
To do that, Wakefit will spend the next couple of years doubling down on product and category expansion, while expanding beyond seven cities, in order to ensure deeper penetration. For now, the company is expecting a good seasonal spike in month-on-month sales as the festive season approaches.
“We have already grown around 70 percent year-on-year. So, we are expecting 2x to 2.5x growth on top of that, on a monthly-level,” says Chaitanya, adding, “The team has been burning a lot of midnight oil over the last few months setting up warehouses, trucks, carpenter capability and production to meet that demand. So, we hope to have a good season this time.”
For the moment, the rate of production at Wakefit’s Hosur plant means the company can furnish one lakh homes per month. The company expects to open a large factory in each of the seven cities it operates in, in the near-to-medium term. “The way things are going, I expect this plant to have the ability to supply furniture to the Bengaluru and Mysore markets, alone,” says Ankit, “So, we’re going to have to open a few more factories soon," he adds.
First Published: Sept 23, 2022 9:03 PM IST
