OOGarden.com, leading online retailer in France of garden and home products, recently announced closing a 2 million round of funding with SOFIMAC Partners, bringing them to a total of 4.1 million [FR] in funding raised this year (earlier this year they raised 2,1 million from Aquasource). These level of funds is nothing to sneeze at, particularly in a sector that many are saying has reached its peak. However, OOGarden’s solid growth, sound operational model, and ambitious expansion plans, demonstrate that ecommerce can still offer a great opportunity if executed well.
OOGarden’s founding and growth is a particularly interesting case as they prove that founding an online business outside of Ile-de-France, can be a winning strategy. OOGarden’s sole founder, Sylvain Legoux, set out to launch a business that was, above all, operationally efficient and could offer the best products at the lowest price possible. Before launching, Legoux studied the market extensive and determined that launching in France’s smaller urban areas would help him better manage costs and create a network of distribution sites, helping to streamline operations and customers service. In addition, although not the size of Ile-de-France, these smaller markets and surrounding areas, were more than sizeable enough to offer an highly attractive market opportunity. As a result, they launched initially in Lyon and ultimately expanded across France to Nantes, Lille, and Toulouse. Having fixed depots also meant that they could to execute a multi-channel approach from early on. So, although OOGarden’s website is an important entry point for consumers, having fixed depots gives them the ability to attract new customers and, ultimately, direct them back to the site and vice versa. These sites also provide a means for improving customer experience as OOGarden leverages them to showcase new products, provide shoppers with personalised advice, offer on-site pick-up of purchases, and deliver post-sales service.
Their strategy has obviously paid off as they reached 20 million in sales last year and expect to reach 30 million by end 2012. The investment they’ve secured will primarily be used to expand internationally, which they estimate will grow their business to 100 million/yr over the next five years. As for where they plan to expand, Legoux has his sights set first on entering Benelux in 2012, followed by Germany (#1 gardening market in Europe) and Spain in 2013. Their network of depots across the various corners of France will serve as an important element of ensuring that, from a logistics perspective, they can properly serve these markets during the first phases of their expansion.
For Legoux, expanding across Europe in a very short period will be a challenge, but is definitely not the limit of his ambitions. He sees that other markets around the globe also present a great opportunity in the long-term. However, for the short and medium-term, they’re laser focused on making sure that OOGarden emerges as the clear European leader in the garden & home sector.