REPORT ON

NYKAA'S BUSINESS

MODEL &

SUSTAINABLE

PRACTISES
Entrepreneurship and Sustainable Business Practices

Team:
Gangotri Das
Sugandha Das
Ritu Ravi

16th Decemeber 2020

 About The Brand

Nykaa is an established beauty and llifestyle retail brand based in India,

started by the entrepreneur Mrs. Falguni Nayar in the year 2012.
Initially, it was operated through online channel and application, but in
2015, it expanded it to omnichannel. It sells cosmetics for both men
and women, and also beauty products.

Busniess Model
Nykaa is a direct-to-consumer eCommerce brand that operates on an
inventory-based business model. The company buys products directly
from manufacturers and stores them in designated warehouses in New
Delhi, Mumbai, and Bangalore. These products are available for
purchase on Nykaa's website or through its three offline retail stores:
Nykaa Luxe, Nykaa On Trend, and Nykaa Kiosks.

Tagline
"Your beauty, our passion"

Mission
To build a world where customers can choose from a carefully chosen,
genuine collection of products and services that delight and uplift the
spirit of people.

Vision
To bring daily inspiration and happiness to everyone, everywhere.
Product Range

Stores Products

Nykaa Cosmetics and naturals Skincare, makeup ,bodycare,etc.

Apparels, footwear, accessories,

Nykaa Fashion home &tech.

Nykaa Luxe Highend skincare and makeup

Nykaa Man Men's skincare, apparels, etc.

Nykaa Pro Products for professional with offer

Nykaa Cross borders International brands

About the entrepreneur

Falguni Nayar, the Founder and

CEO of Nykaa, is recognized as
the richest self-made woman in
India and ranks 10th among the
world's richest self-made
women. Falguni's net worth was
estimated to be approximately
Rs 24,800 crore at the time.
Nayar was a student of IIM
Ahmedabad from where she did
her MBA in Finance. She later
joined Kotak Mahindra Capital
Company, India's top
investment bank where she led
Kotak Securities before
becoming the Managing
Director of Kotak Investment
Banking in December 2007.
She once visited a Sephora store in another country and was awestruck
by the variety of cosmetic products available under one roof. There
were also free samples, makeovers, and a lot of beauty talk going on
around the store. It was every woman's dream come true. This level of
aesthetic diversity, experience, and fair advise was not available to
Indian ladies. Customers had few options when it came to high-end
items, which were mostly available in malls and high-street retail
outlets. Falguni saw an opportunity. She resigned her senior
management position at Kotak Mahindra at the age of 50 to launch
Nykaa.com. Falguni worked in the corporate sector for almost 25 years
before embarking on her entrepreneurial journey when she was
approaching 50. In addition, Falguni is an inspiration to everyone in
Nykaa and beyond since she is a successful entrepreneur and her
enthusiasm for her business, attention to detail, and her involvement in
all areas of the company are some of the qualities that have helped her
become a successful leader. “Retail is all about detail” is one of the most
popular mantras that Falguni Nayar lives by and is often heard
propagating the same. She has also set a great example for the rest of
the globe, proving that "age is just a number" when it comes to business.
Her perspective of her business in once sentence is "We’d rather sell the
proper shade of lipstick at full price than the wrong shade at half price”.
Two factors influenced my decision to leave a rewarding career and
enter the world of entrepreneurship:
1) Her passion for makeup, and
2) her desire to learn more about the online marketing platform that
she saw as having a lot of potential.
 Sustainbility Practices

Economical Sustainbility

Falguni Nayar, a 49-year-old investment banker, created the beauty

and fashion ecommerce portal Nykaa from her father's office. Almost a
decade after her IPO was over 82.5 times oversubscribed, India's richest
self-made woman billionaire claims she is just getting started. It started
as an online firm and expanded into an omnichannel approach. Nykaa,
based in Mumbai, is well-known for its online website, app, and online
stores, offering a varied selection of beauty and cosmetics items,
fashion, and intimate apparel.
Market Value and growth:
As of spetember 2022, Nykaa's market capital is Rs. 62,620 Cr and
founder's is half of it. Its net sale is at Rs. 51.75 Crore in September 2022
which rose up by 4.8%. Nykaa saw growth of 7.9 million customers in
the last nine months of this year, which is an increase from 5.5 million,
just a year ago. For fashion, annual transacting customers were 1.6
million customers, up from 0.4 million a year ago.

Increasing Customer acquisition:

i. Based on products: Nykaa is primarily an e-commerce website
that sells beauty and wellness products from top brands such as Lakmé,
Kaya Skin Clinic, L'Oréal Paris, and others. It has got brands ranging
from home, domestic Indian Ayurvedic brands to Dior and Mac and Jo
Malone. . It currently has 17 physical locations and is growing. It has
over 850 carefully selected brands and 35,000 products.
ii. Based On shopping strategy: The organisation is planning for the
future by recruiting new consumers and retaining existing ones.
Nykaa's beauty and e-commerce divisions emphasised that the firm
always prioritises the client. And believes itself to be an expert in the
indigenous market in this regard. Curation, discovery, inspiration, and
convenience are the driving principles of selling at Nykaa Fashion.
Their major purpose is to compile fresh and different designs, brands,
and seasons for consumers and offer them in a user-friendly way.
.
 iii. Offers: The Group has a reward points program which allows
customers to accumulate points that can be redeemed against future
purchases of products at discounted prices. Writing rewviews for
products fetches the same.

Usage of technology and content marketing:

Nykaa is set to take over local e-commerce platform Little Black Book
(LBB). As per reports, the two companies have been in conversation for
the last few months and the deal is further aimed at improving Nykaa’s
content game and will complement its shopping categories. Nykaa
focuses on being where its customers are, as it always invests in
contents on all influential platform via which it established its
affiliation program.

Employees Relationship:
i. Based on expanding and contingency: The Employee Benefit
expense is in line with their gross profit of 51 percent. Their tech team
and people are their only machinery. Hence,, they don't have any fixed
investments except for stores. Everything else is passed to the teams
who are building the platform of the future. And then investments are
being made in new businesses like NykaaMan store.

Ii. Based on Business ethics: The company does not tolerate any
violation of laws, codes of conduct or internal regulations and have
stringent policies in place to ensure the same. Their anti-corruption
and anti‑bribery policy ensure protection for whistle-blowers and
safeguards them from retaliation in the form of discrimination,
reprisal, harassment, hostility or vengeance of any manner. Employees
and directors can report suspicious events at
whistleblower.employees@nykaa.com to initiate appropriate
investigation. Employee benefits investment has increased
significantly.
Social Sustainbility
An overview of the CSR activities Nykaa have taken are:

Nykaa X GiveIndia Collaboration (May 2021) :

Nykaa contributed to the Give India Foundation during the pandemic
to provide basic medical supplies to hospitals in Maharashtra.
Nykaa had also made use of the power of its digital platform to launch
a fundraiser in collaboration with GiveIndia, where the money raised
through this collaboration were donated to Covid-19 relief efforts.
Employees of Nykaa paid their one day's wages to the PM's COVID
relief fund at the start of the pandemic and along with that, Falguni
Nayar has also personally contributed to increase that amount.

Slum Soccer/Krida Vikas Sanstha :

Nykaa also made one time donation in Slum Soccer organisation
which was created to promote sustainable development among India's
marginalised groups.
Their initiative program 'Edukick' was also designed to help
youngsters from first to fourth grade to understand the fundamental
mathematical concepts, and also to raises awareness of critical
concerns including pandemics, health and hygiene among them, and
over 250 children from Nagpur's Municipal and Zilla Parishad schools
benefited.

Nykaa X P.R.I.D.E :
Nykaa participated in the Joy of Giving Week campaign of the non-profit
Planning Rural-Urban Integrated Development through Education
(P.R.I.D.E. India) and donated to the programme that educates rural
women and girls in the Raigad area of Maharashtra in home salon skills.

MSME :
Nykaa actively engages with the the owners of MSME, along with local
communities and acquire a large portion of its products and services
from them, additionally engaging them in packaging & in
transportation of goods.

Nykaa Academy :
Nykaa also has its own learning platform which aims to provide
customized learning experiences with recent and relevant content to
people gaining new skills and advance their career. This platform provides
thousand's of courses across business, creative and technology topics with
a certification.
Environmental Sustainbility
The goal of Nykaa is to promote waste management while avoiding the
use of virgin plastic and fostering the development of sustainable
ecosystems. To achieve their objectives, they have already taken a
number of actions:
• Using smaller, resized boxes and switching to paper fillers in place of
the plastic fillers that were previously used to fill empty space inside
boxes.
• Over the past six months, replacing some box sizes' plastic product
wrappers with paper retention boards.
• Using more recycled paper overall, which accounts for well over 90%
of the packing material used today.
• Launching a pilot programme where customers can choose to return
empty containers of goods from in house brands.
• Working together with their brand partners to recycle packaging by
returning it
• Gathering junk at their storage facilities for recycling through a third-
party agreement.

• Increasing the amount of biodegradable plastic used in their

operations for packaging needs.
• The use of environmentally friendly products, such as Xhexcus paper,
paper flyers, etc., satisfies more than 70% of their needs for packaging
materials.
• The business has switched from using national to regional fulfilment
for delivery, i.e., by constructing new warehouses to cut down on
overall miles travelled & air shipments. Along with minimising split
shipments, the company has also reduced the number of shipments,
which has decreased the amount of plastic and fuel consumed.
• To successfully manage and recycle plastic waste and eliminate
single-use plastics, the company has a recycling partnership with
"Recykal" that complies with EPR criteria.

The Nykaa 10X10 programme, which was launched in July 2020,

intends to reduce plastic consumption (both in terms of volume and
dollar amount) by 10% year for the following five years. The effort
proposes to work with numerous supplier partners over a longer time
frame of ten years and search for a solution that totally eradicates the
usage of plastic at a consolidated level.
Sustainability Dimensions

Enviornment

Nykaa10x10
Not using virgin plastic
Switching to paper fillers
from plastic
Increasing use of
biodegradable plastic
Minimizing split shipments to
cut down plastic and fuel
consumption

Core IPO-82.5% Oversubscribed

Value MV-62,620 Cr
7.9 M Customer In beauty &1.6 M

in fashion.
NykaaXGiveIndia Wide range of product.
Collaboration Multiple buying location.
Slum Soccer/Krida Vikas Investment in employee as

relationship
Sanstha
Nykaa X P.R.I.D.E Benefits to customer.
Content Marketing strategy via
Engages with MSME technology
Nykaa Academy Approved pattern for giving
cusomer shoppers satisfaction

Social Economic

Core Value : Sustainability in every action and being better

every day are NYKAA's core values

 Our Suggestions
1. Improvement in work culture:
Nykaa should improve it's work culture as their is lack of
transparency. Employees complaints are found over job search
sites(Eg. Glassdoor, ambition box, etc) that they are not given proper
leave time as there is 24X7 work pressure.
Employees were found making making rape jokes, making fun of
mental health, economical status, publicly food shame, and further
insensitive comments were recorded.

2. Improvement in its customer satisfaction and delivery:

Customers are still not satisfied as they complain about missing paid
parcels or products from parcel.
Products packaging not done well.

3. Improvement in paying their content creator:

Content creator complain about not giving them enough aids and
payment, they are paid only by affiliation.

4. Improving in reducing waste by efficient packaging:

The carton boxes used for packaging are too huge compare to the
quantity. This leads to wastage of valuable material. Carton boxes
should come in various sizes to reduce wastage.
PR packages can be minimal because it contains a lot of wasteful and
non-biodegradable material like confetti.

5. Improvement in Task Management:

Legality is not check properly for products and has been targeted by
Food and Drug Administration.
 Learnings
Studying about such a magnanimous brand comes with ample
challenges, yet the team figured out methods to collect the
correct facts from the market.
The suggestion were drawn on the basis of what the company
legally states transparently, what the stakeholders state and
what the customer states.
Furthermore we learned about what the company stand for
and how it is lacking.
The biggest key take away from the study of entrepreneur
herself is that : "Age is just a number." In order to start a
business one needs to be mentally prepared with adequate
experience.
Even though, the company grows owing to its sustainable
methods, yet flaws will be present in the system.
We learned how a brand grows by identifying its scopes by
listening to its customers' need.
 References

1. https://www.nykaa.com/beauty-blog/is-transparency-in-beauty-the-new-norm/
2. https://iide.co/case-studies/swot-analysis-of-nykaa/
3. https://startuptalky.com/nykaa-success-story/
4. 2022 Development brochure of Nykaa
5. CSR Policy of Nykaa-Nykaa Cares
6. Nykaa' Health , Safety and environment policy.
7. Glassdoor
8. Ambition
9. Instagram
10. Linkdin