In response to escalating inflation, Pakistani consumers are shifting their preferences towards more affordable brands, spanning categories like cooking oil, hand wash, and soaps. Mohammad Ahsan Kidwai, co-founder and chief commercial officer (CCO) at Krave Mart, observed this trend, noting a waning interest in supposedly healthier brands, particularly in the cooking oil segment. This shift reflects the significant changes in consumer behavior driven by the economic challenges facing the country.
Krave Mart recently hosted the ‘Krave Mart Partner Summit Q12024,’ where they announced a merchandise partnership with Quetta Gladiators for the upcoming Pakistan Super League, the nation’s premier sports event. Despite the market challenges, the company has managed to maintain positive unit economics and doubled sales. However, Kidwai cautioned that external factors such as fluctuating exchange rates and fuel prices could impact future profitability.
Amidst rising inflation, the average basket size for Krave Mart has seen a substantial increase, rising from Rs350 to Rs2,100. This surge underscores the necessity for consumers to adapt their spending habits to accommodate higher costs. To cater to this evolving landscape, Krave Mart has introduced eight private label brands, which currently contribute 10% of total sales. These private labels offer higher margins compared to other brands, aligning with the shifting preferences of cost-conscious consumers.
Looking ahead, Krave Mart aims to capitalize on opportunities for growth. Co-founder and CEO Kassim Shroff outlined the company’s vision, aiming to double the average basket size and increase Gross Merchandise Volume (GMV) tenfold. Despite the market challenges, Shroff expressed confidence in the sustainability of Krave Mart’s business model, emphasizing their commitment to financial discipline. With a current market share of 30%-40%, Krave Mart is poised to further expand its presence in the evolving consumer landscape, leveraging its expertise and market insights.
