FY20 saw the company clocked US$14m in net revenue, with 85% year-on-year revenue growth.
The 40-50% expected revenue increase for FY21 will be worthy as the company bounces back to its pre-COVID performance despite two months of lockdown in India.
SUGAR Cosmetics was founded in 2015, providing Indian customers with make-up and beauty products matching their skin tones.
According to the firm’s co-founder and CEO, Vineeta Singh, “Back in 2014, the Indian beauty industry was dominated by multinational brands, very few had a range suited for the Indian complexion.”
“Many users would either prefer to source products from other countries or end up with incorrect shades that wouldn’t pair with Indian skin tones.”
Singh said its products are more pigmented and longer lasting, making it more suited to the Indian skin tone.
For instance, its matte face foundation stick has 22 different shades to suit all Indian skin tones and undertones.
SUGAR Cosmetics is a pioneer in India with its matte products such as the transfer-poof lipstick and smudgeproof eyeliner.
While lipsticks continue to be its best-seller, other items like lip primers, serum-based foundations, brow definers, eyeliners, moisturising sticks and illuminating moisturisers also saw a spike in sales during the pandemic, according to Singh.
SUGAR’s products are shipped worldwide, and the firm has manufacturing sites located in Germany, Italy, India, USA and South Korea.
In March, India entered a lockdown which saw SUGAR Cosmetics’ warehouse, retail operations and logistics shut, and new launches from its international manufacturing sites stalled.
Once lockdown restrictions in India were eased around June, the firm saw a month on month increase in sales, coupled with higher levels of digital customer engagement.
“Just last month (November 2020), we achieve 50% more revenue than our highest pre-Covid,” Singh said.
“Our team was supportive enough to double down, work harder, take salary cuts, rent waivers, and reshuffle jobs which were the need of the hour.”
Singh cites its strong e-commerce strategy in consumer engagement and brand loyalty. The company recently crossed the one million follower mark on Instagram. In 2019, it had 300,000 followers.
She attributes this to understanding what its followers want, and churning out interesting content for users “that not only creates a fun space but also educates followers about beauty and makeup.”
The cruelty-free and millennial focused brand has always positioned itself as a ‘creator-than-celebrity-led voice’ in a cluttered market, “where brands spend more time talking about discounts than the power or beauty and cosmetics.”
The company developed a mobile app end 2019 which has since garnered 800,000 app installs in just one year.
SUGAR Cosmetics also has a social media presence on Facebook YouTube, Twitter, and LinkedIn.
In its export markets, US and Russia account for 10% of the company's revenue. In the US, SUGAR is retailing through ecommerce platforms like Amazon and IPSY. As for Russia, sales channels are primarily through L’Etoile, a perfume and make-up chain.
While it works on its online presence, the firm is also scaling up its physical presence with more than 2,500 retail outlets across 130 cities across India in 2020.
Singh said: “Knowing that more than 500 million of the Indian population still prefer to shop in brick-and-mortar outlets, SUGAR plans on opening more stores across Tier 1 and Tier 2 cities, enhancing their retail marketing and visual merchandising experience.”
Even during the pandemic, SUGAR Cosmetics launched five retail outlets keeping hygiene and safety as a top priority for their retail customers.
In October 2020, the firm received US$2 million in a debt round by Stride Ventures. The fund will be used for working capital, inventory requirements and fuel growth as it looks to perform to its pre-COVID peak.
SUGAR Cosmetics is hoping to close its Series C funding soon.