D2C business know-how! An interview for every startup enthusiast.

Direct-to-consumer (D2C) business is what many people want to do as it is a model where you sell your products through your own medium (mostly digital) directly to the customers without the need of a middleman. Thus, it becomes very important to know the practical know-how and realities of a D2C business from an experienced person before entering into the world of doing business.

With this in view, we asked Pradeep Krishnakumar, co-founder and COO of Zouk to share some insight and lessons about the D2C business. Zouk is an Indian D2C brand that makes and sells premium bags, wallets and accessories. All products are 100% PeTA approved Vegan and Proudly Indian.

So, here is the interview for startup enthusiasts who want to start their own D2C business.

1. What do you think about the opportunities for D2C business with the exponential rise in digital penetration?

The seeds of the D2C business were sown quite a few years back with the startup revolution that happened in India. It all started with selling books, electronic gadgets and mobile via an e-commerce platform; now, it is moving towards all the other categories and products that are usually sold through the offline medium. Also, the current pandemic situation has accelerated the usage of digital platforms, and the speed is unprecedented, as the D2C market will reach 100 billion by 2025 across all categories. So, the future has a lot to offer for the D2C business, and it’s going to get bigger with time.

2. With opportunities come challenges. So, what are some key challenges that an entrepreneur must be prepared for while starting a D2C business?

Starting a D2C business seems quite easy, as it looks asset-light with a low initial investment. But, starting up is just a nascent stage, and everything depends upon scaling up. Most of your first sale happens through your close friends and family members, and it will be very wrong to assume that sales will go linear with time. If you cross the milestone of 100 orders doesn’t necessarily mean that you will get to the first 1000 orders.
You have to not get complacent at any stage to scale up and constantly improve through feedback that you receive from all points of the sales process.

3. What are some tips to hire employees for your business?

The hiring of employees happens when you turn from a passionate to a serious entrepreneur. Hiring employees is one of the critical components of scaling up a business, and you must know the following two points before hiring someone:

a) When someone is keen to join your startup, you must understand that this person and their family completely depends on you. No matter what happens, you have to pay them at the end of the month. An employee becomes dependent on you, and you should not take that responsibility for granted.

b) Before hiring someone, share with them the harsh reality of entrepreneurship and startups. They must know the working culture and situations that might come with it. Also, share your vision and purpose behind the startup. After hearing your side, if a person is excited and wants to work with the same purpose, you can move ahead with hiring.

4. Does the COVID-19 pandemic change the way business will be done? What are some changes that an entrepreneur must be prepared to embrace?

Definitely. As said earlier, it has made more people shift from purchasing offline to online from a D2C platform or an eCommerce marketplace. Also, the pandemic has greatly affected the back end of businesses. Every aspect of the supply chain is changed with the impetus to health standards. Also, the boost to remote work has enabled the hiring of employees across the globe. In our case, most of our staff is working remotely, and we have transformed our office space into a manufacturing facility.

In the end, it’s important to embrace change and move on. There is no point in thinking about the past and the way business was done before the pandemic.

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5. What are some advantages that a D2C business has over a traditional business while interacting with a customer?

In a D2C business, you don’t get to meet a customer, but you get to know about them through data. This helps you to understand your customer better and improve your offerings, which is what gives you an edge over the traditional offline business. But make sure to have a personal touch with each sale with thank you messages and emails, which signifies the value of the customer to your company.

6. Would you like to share anything else that is important to know as an entrepreneur?

With the glorification of raising funds and the limelight to unicorns, many young entrepreneurs start off by thinking that building a unicorn is the only acceptable definition of startup success. It’s important to not carry that pressure. You must remember that business is not about big office spaces or raising funds. An owner of a shop or a grocery store is also an entrepreneur. So don’t look at entrepreneurship through certain narrow parameters.

Have a vision, and focus on customer delight. Trust the process, and if a customer comes back to you, be happy about it. You must aim to become big, but don’t let it pressurize you. Find happiness in your daily work and focus on improving yourself. In the end, know that cash flow is of utmost importance. If your startup is a high-end car, then the cash flow is fuel; without fuel, your high-end car is useless.

Note: Check out the Instagram page of Zouk, to know more about their amazing work.