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Voonik introduced beauty products and daily essentials shortly after Nykaa began selling lingerie, sleepwear and accessories about eight months ago. LimeRoad introduced men's wear around the same time -a category that the company says now contributes 25% to its topline. The strategy is to interest customers in a few more things beyond their core products. In other words, at least Voonik and Nykaa are not expecting much by way of revenue contribution from the non-core categories -a strategy analysts as well as investors are not comfortable with. "We will operate beauty as a zero margin category. Voonik will charge just the cost price plus whatever is needed to fulfill the item," said Sujayath Ali, CEO of Voonik. "In my business plan, I have not put any contribution from beauty as a category towards revenues or profit and loss. The only contribution will be due to increased cross-sell opportunities where revenues in other categories will go up." Nykaa has partnered with brands including Clovia , Zivame and Pretty Secrets for its lingerie category. While Nykaa operates this category at the same gross margin range of 20-25% as its beauty products, the company does not expect it to be a strong revenue churner anytime soon. "The rationale to (introduce) this (category) was not for growth since we are growing at 350% annually.
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