How Peps is Revolutionizing the Indian Spring Mattress Industry
Mr. K. Madhavan (MD, Peps Industries) serves as an inspiration for all those others who are looking to set up their own business, especially at the age of 55, when others would be at the pinnacle of their career.
PEPS Industries Pvt Ltd is one of India’s leading spring mattress companies, founded by Mr. K. Madhavan. Madhavan entered the market in 2007, a time when there was only one other player in the spring mattress industry and the convention of coir mattress was still on a high. He took his 30 years of experience in the mattress industry and turned what was only a last and unlikely option into the 500 crore spring mattress category that it is today.
He is a considered to be the pioneer in the concept of branded mattress. He is known for having positioned inner spring mattress as an affordable luxury.
In an interaction with BW Disrupt, K Madhavan shared his entrepreneurial journey.
How has been your journey with Peps Industries so far?
In 2006, we cashed in on a golden opportunity and took over a sick manufacturing unit that was for sale. Further to bringing in cutting-edge technology to India, we associated with M/S Restonic USA, the fourth largest spring mattress brand in the world.
Coir and foam mattresses dominated the market when we made an entry in the market. At that time, out of the total mattress market share, spring mattresses had a share less than 2%. Educating the customer about spring mattresses was a major challenge as people in India had a firm belief that only a firm mattress is good for sleep. Over a period of 12 years we have established ourselves as the India's top selling spring mattress brand with a CAGR growth rate of around 33%. In the year we started our operations, the company turnover was Rs 4 crore and today in 2018, Peps has a turnover of Rs 300 plus crores.
Explain your business model. How are you disrupting the spring mattress industry?
We see our business model as an example of a "Disruptive innovation". My partners & I noticed that the market is dominated by cotton, foam and coir mattresses. We had a vision that the consumerism driven Indian market with surplus disposable income will certainly embrace the International standard spring mattress. In order to bring in revolution in the industry, we became first Indian company to introduce international sleep comfort to people in India.
We disrupted Indian mattress industry by making an international comfort such as spring mattresses something simple, convenient & accessible to our customers that's affordable. There was only one small manufacturer of spring mattress in the North at that point in time. Today, all the major players in the industry have started manufacturing spring mattresses and are venturing into the spring mattress segment.
How many stores are owned by Peps Industries currently?
Currently, we have a pan India presence with over 125 company owned “Great Sleep Stores” and a strong network channel of 5000 dealers spread across India and 4 manufacturing facilities.
Are you planning overseas as well?
We have a license from Restonic USA, for developing products under their brand for all SAARC nations, and hence we in the planning stay of international expansion into the other countries. We have already started our operations at Nepal and our next destination would be Sri Lanka.
Share your brand growth plans.
We are currently in the process of augmenting the brand with all the accessories that goes with a great night’s sleep. We plan to shift to an automated facility from manual labor as it will bring consistency in quality of their products.
Currently there are 125 Peps Great Sleep Stores across the country and plan to take it to 250 stores across metros pan India by 2020.
Today, Peps is an undisputed segment leader and in 5 years, Peps will aim to hold this position while constantly striving towards bringing innovation and quality to its consumers.
What has been your contribution in the growth of Peps Industries?
Ever since I graduated, I have been in the mattress industry. One of the big names in the industry gave me my first break and then I went on to serve as President of Operations in the same organization. Through this, I gained an insight on the mattresses industry. With only one or two major players around, the market was dominated by a small group of highly consolidated wholesalers and there was a huge market that was yet to be tapped in.
Realizing that a huge share of the market was unexplored, I took it upon myself to do a simple thing and did it my way "really well”: Help Indians sleep better and live the Peps life.
India had yet to accept the spring mattress concept, while 79% of the developed countries population was already using spring mattress. While the focus of the industry was still on the conventional coir and cotton mattresses, I decided to venture into the spring mattress segment using my 30 years of experience. With my only goal to bring international comforts to the Indian consumer, we started Peps Industries.
I realized the lack of awareness amongst the consumers about the importance of spring mattresses and dedicated myself and Peps towards educating the consumer of this. We did not limit ourselves to only educating the metro population; the focus was on everyone: Rural and Urban population.
How big is the mattress industry in India and how much of the market share has Peps Industries captured so far?
Currently PEPS is the only brand that deals with innerspring products and continues to hold over 56% of mattress market in the hospitality segment. Estimates put the mattress industry at close to Rs 6,000 crore in India. The spring mattress industry is estimated to stand Rs 500 crore, and we claim a 56 per cent share in the same.
Speaking of estimates, the mattress industry in India is worth Rs 6,000 crore. The spring mattress segment is estimated to stand at Rs 500 crore and we claim a 56 percent share in the same.
Any update which Peps Industries has announced recently or planning to announce in coming months.
Recently Peps and Flipkart entered into a partnership which gave the e-commerce company exclusive rights to sell Peps Industries’ products and its 2 allied brands Hypnos and Cirrus. Being India’s leading spring mattress company and disrupting the offline market, we look towards conquering the online segment through the partnership. Partnering with India’s biggest online marketplace, Flipkart, will help us take Peps to new heights. We understand this generation of consumersand their requirements. This generation is more active on online marketplaces. This partnership will ensure that online shoppers are given access to high-quality, luxurious products.
Tell us about your marketing strategies.
Given today’s lifestyle, an average adult sleeps less than seven hours a night. We felt the need to create awareness about sleep hygiene led to the creation of the Peps campaign: 'livethe #pepslife'. Peps is one of the few brands which has used its brand name creatively. Positioning of our brand is a reflection of changing life style of people. While other brands campaigns talks about sleeping well, our focus has always been on importance of waking up fresh.
This positioning of waking up energized is one that Peps has been following for years now and which was so successful that it led to countless competitors copying, imitating and plagiarizing. The copying has led to us filing 3 dozen lawsuits against our competitors.
Around The World