Aqib Mohammed, Co-Founder of Powerhouse91

There are very few things that can deliver the same level of satisfaction as waking up in the morning with a strong purpose, knowing what you do through the day can make a positive difference to someone else’s life – This is what motivates Aqib Mohammed, co-founder of Azah, every day, to innovate in an industry that has seen very little change over decades – the Indian feminine hygiene market. Starting his professional journey in June 2015 as part of the technology team at Snapdeal, where he got an opportunity to closely experience the giant wave of change that E-commerce was bringing into people’s lives. As part of Snapdeal, he was involved in Snapdeal’s own in-house C2C Commerce startup Shopo, where he worked on developing growth tools that ultimately helped Shopo reach 1mil+ downloads within 6 months of its launch. Catching the startup bug early during his college years at IIT Roorkee, he soon ventured into entrepreneurship with his own startup, Xolvr, a K-12 online education marketplace.

 

E-commerce has been an important catalyst of growth in India – with sellers, customers and brands contributing in their own significant ways. One of the newer contributors in the ecosystem, e-commerce roll-up companies have only accelerated this process further by acquiring stead-fast and up-and-coming brands to fasten their growth. The primary way E-commerce roll-ups create value is not by relentlessly absorbing smaller brands but, rather, guiding them forward with their proficient expertise, whilst the small-scale brands retain their individuality and control. 

A D2C (Direct To Consumer) business model typically centres around unique, sometimes customizable products and value propositions. This new wave of D2C has incredibly expanded during the pandemic with people feeling more comfortable discovering and exploring new brands online. Despite the high-growth curve, running a D2C brand comes with its own uncertainties, that are multifold -fluctuating marketing costs, rising inventory and freight prices, competition by similar D2C brands and established brands offering similar products. That’s when an E-commerce roll-up company accesses the potential of a D2C brand and supplements it towards an upsurge of growth and profitability through various levers across marketing, supply chain and growth capital.

It is not uncommon for customers, nowadays, to support and seek out local brands for their unique requirements. This further drives the relevance of online prevalent brands and creates a lasting synergy between D2C brands and roll-up companies. As roll-up firms and companies take on brands that are already integrated into the market, they provide a clear blueprint of marketing tactics and techniques, technologically advanced expertise and tech-enabled platforms, comprehensive optimization across the board, functional strategies and pragmatic operational approaches. These pivotal applications of business strategies launch the D2C brands to the next level and gain a crucial advantage over competing brands.  

A striking pattern is quite apparent with roll-up companies -the brands they acquire grow much faster than the roll-up businesses, themselves. This groundbreaking business model has proven to be fruitful for the promising D2C brands that are consolidated by roll-up firms. The most limiting obstacle for the new ambitious D2C brands seems to be working capital and lack of inventory leading to a glaring loss in revenue. A roll-up business facilitates financial stability with the necessary resources required by the D2C brands to minimize their overhead costs and boost their cash flow.  

A roll-up firm ensures determined D2C brands to put additional focus on their product while the Acquirers, i.e. the roll-up firms, master their marketing strengths for the D2C brands. The innovative roll-up firms manage innumerable hurdles faced by D2C brands on their journey to success. A smooth sail to success does involve treacherous and turbulent interferences for any young and ambitious business, especially for D2C brands that are restricted by not having long-term functionality and organization mapped out. Seizing this as a fortunate opportunity, roll-up businesses and firms or acquirers proceed to propose operational and financial assistance to the said D2C brands as valuable and profitable solutions through a compatible and collaborative partnership.  

For a truly harmonious and mutually beneficial partnership between the roll-up businesses and D2C brands, like any business agreement, a continuous path of transparency from both parties remains paramount. Before a roll-up firm explores operational and marketing procedures with a D2C brand, they execute a deep dive into the D2C brand’s business model to inspect its longevity and sustainability. A steadfast and potentially unwavering growth of a D2C brand hits the marks and comes under the criteria for a gravitas undertaking by a roll-up business. 

As roll-up businesses and companies diversify their portfolios by consolidating and acquiring qualified D2C brands under their (riskless) wings, reevaluating the dilution of resources across numerous distribution channels ought to be in foremost priority. Analysing D2C brands with common distribution channels establishes efficiency and a sustained ascend towards economic scalability.   

Currently, e-commerce presents transformative opportunities presented by leading roll-up businesses and D2C brands with their excelling business models and innovative marketing strategies for monumental profitability. Powerhouse91 has a combined experience of more than 30 years across e-commerce, marketing, technology and supply chain that challenges and overcomes the limits that obstruct a brand’s growth. Powerhouse91 provides a platform for your brand to become one of the biggest, in India and beyond. 

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