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    74 vacation homes added in 6 months — SaffronStays thrives as supply matches demand

    74 vacation homes added in 6 months — SaffronStays thrives as supply matches demand

    74 vacation homes added in 6 months — SaffronStays thrives as supply matches demand
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    By Shloka Badkar   IST (Published)

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    The hospitality startup was initially designed as an Airbnb-like business. But it quickly pivoted to a model which involved running, managing and marketing vacation homes. From a single homestay, SaffronStays now has over 200 properties in its fold. The demand was always there, now supply is catching up, Devendra Parulekar, the Founder of SaffronStays told CNBC-TV18.

    SaffronStays which started off with one homestay — the Parsi Manor in Matheran — in 2016, has now grown into a business with over 200 properties on board and a 100 more in the pipeline.
    The company now adds 10-15 homes every month and in the last six months, it has launched 74 homes. "These numbers are three to four times more than what we used to launch pre-COVID. And in this business, supply drives growth," said Devendra Parulekar, the Founder of SaffronStays.
    Parulekar believes that in his business, demand was never a constraint for growth, but supply was. As the demand for private villas and private homestays has improved, the supply has improved as well. "Now, post-COVID, a lot of people are investing in second homes and vacation homes and villas, which of course, will increase the supply," he said.
    The COVID-19 pandemic, Parulekar says, has made SaffronStays "exceptionally resilient," and this shows in its numbers. The company's revenue increased from Rs 14.5 crore in the 2019-20 fiscal year to Rs 30 crore in FY22.
    For the current fiscal year, the company is expecting to report Rs 50-crore revenue. "Our aspiration is to be a Rs 100 crore company in the next two to three years. That will happen only because of the fact that the supply is growing. The demand anyway exists," he said.
    Of the 200-plus homes and the 100 other in the pipeline, around 50 percent of them are based in Maharashtra. "But the growth is coming in from North India, Goa and Maharashtra, These are the three priority markets for us," Parulekar said.
    The company was started by Parulekar's wife Tejas in 2014 and was launched in 2015, on an Airbnb-like business model. "But we quickly pivoted to a model where we started running, managing and marketing vacation homes," he said.
    There's a taker for every property
    From a sustainable stay at Glasshouse Celeste in Uttarakhand to a Hobbit village in New Zealand-inspired AsanjA villa in Maharashtra, SaffronStays has quite a few unique properties on board.
    asanja maharashtra, asanja saffronstays, saffronstays, AsanjA in Maharashtra, an earth-sheltering/underground home, is inspired by the Hobbit village in New Zealand. (Image courtesy: SaffronStays)
    Parulekar believes that there is a taker for every property. "Somebody has built the property, which means they built it as per their taste. There will always be a community, type of people or a person or personality that will be attracted to that type of home. Every home attracts a unique audience. Some are Instagram-friendly, some love being in the wilderness with no connectivity, some like luxurious homes, some are farmhouses, nature-oriented," Parulekar said.
    The company's average room rate is Rs 8,400, which has increased by 18 percent over the last four years, he added.
    The properties at SaffronStays fall under three segments:
    • Super premium: Rs 13,000 to Rs 15,000 per room/per night
    • Gold segment: Rs 9,000 to Rs 10,000 per room/night
    • Entry-level segment: Rs 6,000 to Rs 7,000 per room/per night.
    • The villas cost depends on how many rooms it has. For example, if a super-premium villa has two bedrooms, it will cost around Rs 30,000, said Parulekar.
      'We are a tech-heavy company'
      "We are out-an-out a technology company. We happen to be in the hospitality business," said Parulekar.
      The company spends 25 percent of its margin on technology. "We spend on tech. It is a very very heavy tech-investment company. A large part of our talent is also tech talent," he said.
      Of the 150-odd employees on its payroll, around 50 of them are from the tech field. "Today, we sign around 20 homes and launch around 15 homes a month. It requires operational staff to be present to oversee the homes. There are also various other teams such as for reservations and marketing. So growth is inevitable," he said.
      However, he added that the company does not want to increase its team needlessly. "Instead of growing the team size proportionately, we would like to rely more and more on technology to serve the customer needs, whether it is bookings or during and after their stay, etc," he said.
      The company recruits a mix of people from different industries, such as hospitality industry as well as engineers. "What does an engineer do in a hospitality startup? A large part of our marketing team is also ex-engineers. Engineers, particularly from certain institutes, are almost like stem cells. They can work in any conditions. They are essentially problem-solvers. So our recruitment HR philosophy is very different from traditional hospital companies," he said.
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