WOW Skin Science faced a Strategic Loss Reduction in FY24
Introduction
WOW Skin Science faced a Strategic Loss Reduction in FY24. It shows a whopping change in the financial parameters in FY24. It reports 40% fewer losses even if revenues are down. In cost management, the D2C beauty brand indicates a transition from a growth style to a business operations style.
Financial Analysis
The body Cupid Private Limited declared a loss of 130.2 Cr for FY24 as compared to 258.1 Cr in previous FY. But the operating revenue decreased by 10%. This operating revenue of is INR 233.5 Cr in FY24 while it was INR 258.1 Cr in FY23. It looks as if a financial restructuring has taken place. This restructuring has helped the company to increase the operational efficiency at a faster rate.
Cost Management Success
The greatest success highlighted by the company in FY24 was probably the efficient cost management it displayed. The expenses were brought down by 22%, the figure lowering from INR 486 Cr to INR 377 Cr. A major contribution to these savings were from controlling advertisement and promotional costs. It decreased down to INR 107 Cr from around INR 200Cr.
Market Expansion and Growth
WOW Skin Science was launched in the year 2014 by brothers, Karan and Manish Chowdhary. It quickly became the key player in the beauty and personal-care market. Thus, the range of the brand’s products includes skin, hair, bath, and body products, as well as nutrition supplements. Its market coverage now spans over 200 Indian cities and 22 countries. The company is focussed to expand it’s products in South Indian region and United States. New market entrants occurred recently in UAE in 2022 and KSA in 2023 showing its growth’s internationalisation strategy.
Future Trajectory
Co-founder Manish Chowdhary has mapped out a rather aggressive but feasible plan for the company to turn profitable. The startup is expecting to report near break-even in the fourth quarter of their FY 25. The startup expects to get full profit by 2025. It seems like this startup has all the chances to successfully continue the growth phase.
5. Industry Overview and Competition
WOW Skin Science has a diverse portfolio and is competing with big brands like Plum, Mamaearth, Juicy Chemistry etc. The company entered a new strategic market segment in cosmetics through the recent release of the Color Cupid. The Indian beauty and personal care market is expected to make high growth. It can reach reach $28 billion by 2030. There are various factors influencing the same. Some of them are Rising Consumer Awareness and Willingness of people to Spend on Quality
Conclusion
The latest numbers of WOW Skin Science for FY24 reveal that they have faces a strategic loss reduction in FY24. They are also expecting profits in coming year. This can be a tail of reduction in expenses in the company and frugality. However, the clear strategy of the company and some new expected fresh investments can put company in a favourable position in D2C landscape. Moreover, the increased market area and product diversification speaks on it’s own. If the strategy of WOW skin science works, then it is surely going to be a success.
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