The Sleep Company bets on offline expansion for its home offerings
The sleep solution provider is also aggressively building on store counts by increasing penetration in existing cities and expanding to more Tier II towns.
is betting on offline expansion to clock its ambitious target of more than Rs 500 crore in revenue, according to Co-Founder Harshil Salot. The mattress maker plans to open about 150 company-operated and company-owned stores by the end of this year, after completing the launch of 100 stores this week.
Under its two-fold plan, it plans to increase density in existing cities and expand to 50 cities with its experience centres across the country. Currently, the top 20 cities account for about 60% to 70% of its total sales. A majority of its revenue—nearly 85%—is funnelled through its D2C operations, which include retail stores and its website.
"All of The Sleep Company stores have been EBITDA profitable since the beginning of its operations." the company said in a statement.
The Sleep Company also recently expanded its portfolio to add ergonomic chairs under the brand name Ergosmart, and even launched recliners, which Salot said are doing “phenomenally well.” Unlike its peer Wakefit, the company doesn’t plan on foraying into home solution categories beyond sleeping and sitting offerings. Instead, it expects to launch new products and expand its range in these two categories, Salot told Yourstory.
Salot added that the company expects to achieve profitability in the fourth quarter, with plans to break even for the entire year. This outlook reflects a trend toward premium sleep solutions gaining traction amid heightened health concerns following the COVID-19 pandemic, and mattresses turning into a “pseudo wellness product”, with consumers taking the time to understand the best fit for their mattress.
It logged a revenue of Rs 335 crore on an unaudited basis in the financial year ended March 31, 2024, and said it is very close to breaking even but refused to provide specific numbers. Its operating revenue surpassed Rs 127.14 crore in FY23. The company expects to be profit after tax (PAT) profitable in FY25 and eyes a turnover of Rs 1000 crore in the next 2-3 years.
“Obviously there is an aspiration to list the company. We believe that we want a much broader set of investors to invest in The Sleep Company. We feel that that is still about two to three years away. The idea is to grow much bigger and really focus on profitability.” added Salot.
Salot also revealed the company's plans to launch a suite of products under the smart sleeping solutions, including an AI-backed technology to measure sleep score and a temperature-controlled mattress topper which would tentatively retail in the range of Rs 25,000 - Rs 30,000.
The Sleep Company clarified that the products are still under development and testing and would be launched during the third quarter. These are similar to product offerings by its peer Wakefit.co’s Zense range which includes a temperature-controlled mattress topper and a sleep quality tracker.
Founded by Harshil and Priyanka Salot, The Sleep Company plans to go global and test a product market fit but sees most of its growth coming from India in the near term, over the next one or two years. It secured $22 million (Rs 184 crore) in Series C funding from existing investors Premji Invest and Fireside Ventures in December 2023, just a year after it had raised nearly $21.3 million from the same investors.
Edited by Jyoti Narayan