Tech platform Ace Turtle helping retailers expand their online presence
The pandemic has given a major boost to our business. Overall, our business grew 20 times in the last 3 years, says company’s CEO Nitin Chhabra
Seamless customer experience has been the constant endeavour of retailers. Ace Turtle is an omnichannel commerce enabler that leverages technology to help retailers in providing such experience. Founded in 2013, Ace Turtle has many marquee clients whom it serves through its proprietary IT platforms.
It has recently announced to launch 100 Lee & Wrangler stores in India apart from entering into partnership with Flipkart to bring Toys 'R' Us and Babies 'R' Us to India. In a conversation with the Bizz Buzz, Nitin Chhabra, co-founder and CEO of Ace Turtle, said the company is confident of achieving $600 million gross merchandise value (GMV) in the current financial year.
Has the omnichannel approach of the retail sector gathered pace after pandemic?
The pandemic has had a profound impact on the way consumers shop, forcing retailers to take more of an omnichannel approach and elevate the shopping journey. Due to frequent lockdowns with the physical stores either closed or running at reduced capacity, brands and retailers had to make some quick business decisions to meet their customers' needs. A seamless integration between online and offline channels enabling a seamless shopping experience was the need of the hour. With the pandemic behind us now, the demand for omnichannel has risen. The omnichannel platform helps in digitizing, adapting, and integrating online-offline channel operations to overcome the physical world challenges and to deliver a cohesive and comprehensive experience across different touchpoints driving customer buying behaviour.
How is your tech platform Rubicon facilitating retailers' business? Have you introduced any new features on the platform?
At Ace Turtle, our core focus has always been on transforming retail through technology. We focus on enhancing efficiency and scalability of brands and retailers through digital transformation leveraging our omnichannel technology platform. Our DNA is that of a technology startup operating in the omnichannel space.
Rubicon is our proprietary omnichannel technology platform. Powered by machine learning, our unified commerce platform Rubicon 3.0 (the latest version) supports various omnichannel use cases such as inventory lying anywhere can be sold across channels, fulfilling orders from any stock points (retail stores, warehouses and distributors) and a single view of product, inventory, and customer through a single platform. We have recently launched a Seller Protection Fund (SPF) feature for our clients on Rubicon. It provides higher operational efficiency as sellers can seamlessly raise SPF claims for QC-failed returns with online marketplaces, during the return processing flow & track the status of the same within Rubicon.
You have recently announced that Ace Turtle will open 100 more omnichannel-enabled Lee & Wrangler stores. How has the progress been so far? Can you throw some light on investment, and headcount addition for achieving the same?
Our vision for Lee & Wrangler is to grow the iconic brands to their leadership position in the denim segment in India. With the worst of the pandemic behind us now, we are excited to announce the store expansion of Lee & Wrangler in the current fiscal year. We will add 100 more omnichannel-enabled stores by March 2023. We will launch these stores on a franchise model across tier-1, 2 and 3 cities of India. We aim to set up the stores closer to where our customers are to provide them the best omnichannel shopping experience. The 100 new stores will likely create jobs for 800-1,000 people who will be directly employed by the stores. They will be on the payroll of franchisees who will own and operate these stores. Ace Turtle will provide stock, marketing support and its omnichannel technology platform to the franchisees, who will own and operate the stores.
What was the GMV of Ace Turtle in FY22? What is your target for FY23?
We processed transactions worth over $200 million in GMV (gross merchandise value) last fiscal. We are aiming to grow this to $600 million GMV in the current fiscal.
Can you throw some light on profitability? What are the plans of Ace Turtle going ahead in this regard?
We are a profitable company with a high single-digit EBITDA. We expect it to be double digit EBITDA by next year. We have strong growth plans for the future. The pandemic has given a major boost to our business. Overall, our business grew 20 times in the last three years. The SaaS business has grown three-fold during the same period. The clients on the SaaS side are mainly in the lifestyle category comprising consumer durables, fashion and home. On the licensed brands side, we have a strong pipeline and will make two new announcements soon.
How is the demand for omnichannel distribution among retailers in the current environment? Do your solutions remain relevant for retailers expanding in tier-II and III cities?
While there has been rising awareness about the adoption of omnichannel in retail, the on-ground penetration in India is still low. India is a large market where customers are spread across the length and breadth of the country. The larger cities have enough customers to support the opening of stores. But there are many smaller towns with small pockets of customers that are not large enough to sustain the opening of a store. However, they can always be reached online. In fact, a lot of these towns are closer to the larger cities and through omnichannel fulfillment can be serviced from the stores in these cities. On the other hand, the lines between online and offline have blurred greatly and this has accelerated due to Covid. The stores now need to be omnichannel ready to support this.
Being the market leader in the omnichannel technology space for brands and retailers, we have built a strong demand for our offerings. We have over 75 clients in the SaaS business currently across India and UAE. We follow a performance-based model where the payback period for the clients is less than a year.
What are the biggest learnings from the Covid pandemic?
The pandemic has reaffirmed our philosophy of having a lean team and efficient operations. We were able to grow significantly during this period. During the first wave in 2020, the entire retail industry was almost shut down completely and cash flows of retailers were heavily impacted. Despite these challenges, we are proud to have protected the jobs of all our employees.
During the pandemic, we also realized the need to extend our business beyond the core SaaS vertical and offer our omnichannel technology capabilities to our licensed brands. We launched the Licensed Brands vertical in 2021 by acquiring long-term licenses of iconic American denim brands Lee & Wrangler (from Kontoor Brands) for India and select South Asian markets. We provide an end-to-end offering comprising design, local sourcing and retailing for international fashion brands in India.
We have over 10 clients in the Middle East and are looking to grow that portfolio. We have more than 200 people currently and continue to see a healthy growth in our employee base. Within a short span of a year and despite the pandemic, we have leveraged the strengths of our omnichannel technology platform to transform the businesses of both Lee & Wrangler in India. The sales for Lee & Wrangler today are higher than the pre-pandemic period with a positive EBITDA. In 2021, we partnered with Flipkart to set up a JV that will launch Toys 'R' Us and Babies 'R' Us in India later this year. We will be making a few more announcements later this year.