Cityfurnish, an online furniture and appliances rental startup based in Delhi NCR, will be exploring more opportunities in the hospitality sector after working with the brands like OYO, Beer Café, NYC Pie, Republic of Chicken, etc. Among the hotels, the company has already signed contracts with Lemon Tree Hotels and Sayaji Hotels in recent months, making inroads into mainstream hotels with its rental services. According to Neerav Jain, Founder of the company, they will look at working with ‘structured players’ in the hospitality sector who look for standardised products at multiple locations. In a major breakthrough, Cityfurnish has signed MoU with Yum brands like KFC and Pizza Hut for furniture. “We are currently working on the prototype for furniture for 120 restaurants,” he said.
Started in September 2016, OYO was the first hospitality brand Cityfurnish signed up with. Today, Cityfurnish has more than 35 B2B clients and over 5,000 retail customers in cities like Delhi NCR, Mumbai, Bengaluru and Pune. The company will be formally launching their services in Hyderabad by end of this month. “We are primarily looking at expanding our services initially to cities where inter-city migration is strong, followed by education hubs, pilgrim centres, etc.,” said Jain.
‘Furniture is a depreciating asset. Today, people do not want to live with the hassle of ownership when it comes to depreciating assets like car, furniture, etc. Earlier, a rental option was not available for people,’ Jain informed. He said that as a rental platform, Cityfurnish gives a wide range of option to customers starting from INR 299 per month for a bed. “We keep upgrading our products and taking our customers along without allowing them to go off the eco-system,” he said.
Talking about the advantage of the rental model for hotels and hospitality businesses, Jain said that financial benefits are much more for hotels if they follow the Opex model when it comes to Furniture rather than the conventional Capex model. Rental doesn’t show up as a liability in company’s books. Therefore, it doesn’t impact the creditworthiness of the company and therefore its propensity to take debts from structured institutional debtors remain intact, he added.
He said that while the company is keen to expand its business in the hospitality market, they are more cautious of selecting partners to avoid the risk of closures and terminations, etc. He said that the company would look at working with more structured brands in the market which want to scale up faster and look for an Opex model for that.