Riding high on India story: Herman Miller targets 25% growth in FY20

On the Table

Premium Furniture brand Herman Miller is targetting 25% growth in its India operations this fiscal and is also mulling on plans to expand its operations in Bidadi in Bengaluru, a top company official told DH in an interaction recently.

Kartik Shethia, Vice-President, Herman Miller Asia Pacific said, “Our revenues from India are about $50 million. We have seen a 60% year-on-year (y-o-y) growth in the premium office furniture category in the last fiscal and hope to grow at a pace of 25% in FY20.”

According to Shethia, this spurt in growth has been driven by the presence of the Bidadi plant, that has helped bring the consumers closer to the end product. He points out that more localisation on the back of discussions with Indian consumers has also helped the brand establish itself in the country. Shethia also says that it has helped meet the demands of their local consumers, quickly and more efficiently.

Though many sectors of the economy have been feeling the brunt of an economic slowdown, Shethia states that it has not impacted the brand in India. “Most of our clients are top IT firms and in the banking space. Thus, the slowdown has not impacted us much.”

The company is bullish about the co-working sector and its success but admits that demand from companies in this space has not picked up yet. “It is a new industry that is working out its costs at the moment. Since we are in the premium space, we are confident that this space will open up soon,” says Shethia.

While a massive chunk of their business comes from the B2B segment(80%), they are looking at shifting focus to the B2C retail space as well.

Shethia says that the brand is looking to focus on B2C retail in the future, even though B2B remains the primary concern. “In the B2C space, we are working on creating a digital front end and establish a working supply chain.”

The emergence of more global players in the furniture space in India is an encouraging trend, states Shethia. “It ensures that Indian customers can get good designs, better and durable products. It will help lift the market as well.”

The furniture maker has invested $10 million in its factory in Bidadi near Bengaluru and has more than 400 people working in the country.

Bidadi Plant

The Bidadi plant is expected to drive exports for the company products to the Middle East and Africa. “When we set up the plant, it was expected to drive exports.

However, the success in India has meant that we have focussed on the domestic market. We are looking at starting exports from the Bidadi factory soon.” he says.

The company remains very bullish about India. “It remains one of our major markets.” The Bidadi plant now serves more than 70% of the local demand. We are looking at moving into the retail market with partners in tier-II cities. We have an online store and have listed some products on e-commerce majors Amazon and Flipkart.

It recently launched two of its products, Atlas Office Landscape workstation and Cosm chair in India and has set up a facility in Bengaluru supporting India and various other geographies in terms of design, IT, R&D, finance and others.