Aiming to sell its products directly to the customers while retaining its foreign investments, Urban Ladder has filed an application with government on 5th September to convert into a single brand retailer.
The development was first reported by Economic Times.
Two people familiar with the issue informed that the online furniture marketplace eyes to stock products and sell them directly to consumers.
They stated that Urban Ladder Home Decor Solutions Pvt. Ltd has sought approval of DIPP ‘to undertake single brand retail trading under the brand name Urban Ladder’.
Urban Ladder, currently, does not directly sell products to the consumers as it is foreign-funded, which only allows them a technological platform for retailers to sell their products and not sell any products on their own.
In its application to DIPP, Urban Ladder has stated that it would set up physical stores to comply with single brand rules. The first such store will cope up within Urban Ladder’s office complex in Bangalore, sources said.
India amended its single brand retail FDI policy last year in November announcing a unified licence for foreign-funded companies that sell products under mono labels for both offline and online retail, thus allowing such firms to do their own inventory-led ecommerce business in the country.
The move, however, would make them the first foreign-funded ecommerce marketplace to capitalise on new regulations that allow foreign-funded single brand companies to sell directly through online portals provided they also have brick-and-mortar stores.
Becoming a single brand entity, would enable them to buy goods, hold them in its own warehouses, and also sell them to consumers. India allows 100% foreign investment in ecommerce marketplaces but such models are not allowed to stock and sell merchandises.
Urban ladder has till now raised $77 million in four rounds of funding from mostly foreign investors including SAIF Partners, Kalaari Capital, Sequoia and Steadview. They also count Ratan Tata as an investor in the firm.