A vision for e-commerce success
Inside Lenskart’s reinvention from D2C upstart to fully integrated eyewear powerhouse.
More than 75 years after India’s independence, some 100 million of its citizens who need eyeglasses don’t have access to them. Studies show that 3 out of 4 Indians older than 50 who need corrective glasses can’t afford them.
The WHO estimates that untreated eye conditions cost the global economy more than $200 billion annually, with the majority of that toll falling on poor nations.
In India, which has 1% of the world’s vehicles but 13% of traffic fatalities globally, poor uncorrected eyesight has been linked to some 60% of accidents.
A 2018 study conducted in the state of Assam showed that tea pickers who received glasses when they needed them saw their productivity increase by 22% on average.
This eyewear deficit spurred Peyush Bansal to found Lenskart in 2010. Several nonprofit organizations are also working to make eyewear more accessible and affordable across India.
A pair of Gandhi’s iconic gold-plated round glasses sold at auction last year for $340,000.
“We always wanted to serve large numbers of people so we needed to be about large volumes,” Bansal says. “That meant unpeeling the layers and going deeper and deeper to really understand how to make a great pair of glasses.”
Internet company or manufacturer?
Initially, Lenskart had relied on the eyewear supply chain to fulfill orders they received either through their website or through the small storefronts the company started opening around India. That’s what most others in the industry do. One exception is the Franco-Italian industry giant EssilorLuxottica, which operates LensCrafters, Pearle Vision, and Sunglass Hut stores, and manufactures frames for designers including Chanel, Armani, and Versace while also producing house brands like Ray-Ban and Oakley. The 180,000-employee giant generated approximately $23 billion in sales in 2020, just short of 15 percent of the global eyewear market.
But the outsourcing model quickly showed cracks. Lenskart had a no-questions-asked return policy, but its suppliers rarely took responsibility for shoddy work. As the number of returns grew, the company began thinking about making both frames and lenses. “Relying on other players wasn’t the way to deliver a great product to people,” Khurana explains.
To Bansal, the ample room for improvement on price seemed evident. “Nobody knew why the price was so high, except that the manufacturer knew if you could sell progressive lenses for $500, even in India, then they could get away with charging $250,” he says. “That was a lot of the logic of bringing it in house—to really democratize these new age technologies, which are sitting out there only for the privileged.”
The next step in Lenskart's integration came in 2017, when the company began making its own lenses at a small factory in northern India, not far from their headquarters in Delhi. That would have multiple benefits for the company, says Ashwani Agarwal, the company’s chief supply chain officer. “Because of the geographic location and labor availability and the lowering of all the other associated expenses when items are coming from overseas and going through an Indian port, we can reduce both our costs as well as our time to market,” Agarwal says.
Two years later, Lenskart moved into making plastic frames. This time, the company partnered with an established maker in China. Using subsidies provided by the Chinese government, Lenskart and its partner were able to secure and open a factory in a remote village.
As it turned out, frames proved even more challenging than progressive lenses because of the many parts and processes they required, from screws to soldering and finishing. “There’s at least 20 unit operations in making a frame,” says Puneet Bahl, the Lenskart vice president who oversees the company’s supply chain.
The benefits of bringing manufacturing in-house
A list of other dividends from Lenskart’s integration have become equally important. Manufacturing has helped build a moat around Lenskart’s business that a potential competitor would be hard-pressed to challenge. Meanwhile, forecasting has become more accurate. That translates into more customers happy they are receiving an order within two days of placing it, either online or at a store. “Relying less on third parties means we can be more agile and much faster to market,” Agarwal says. Supply chain worries haven’t been completely eliminated but they’ve been greatly reduced. “We still depend on suppliers for the raw materials, but controlling the semi-finish products means much greater control in our hands,” he says.