Fashion retailer Nykaa has temporarily suspended operations amid the lockdown and has also informed vendors that there will be a delay in making outstanding payments to them.
Nykaa told vendors and suppliers that its cash flow and income is impacted, while expenses remain constant. The lockdown has already impacted business across industry, and this will have significant impact on the business cycle including cash conversion cycle, Nykaa said.
“In light of this, we find it prudent to update you that there will be a delay in making payments of outstanding invoices to all vendors and partners. We are trying our level best to address this and will keep you posted on the matter,” it told vendors in a letter. A copy of the letter was shared by the All India Online Vendors Associations (AIOVA) with TNM.
As part of the government directive on the lockdown, Nykaa has temporarily shut down all its retail stores, corporate offices and warehouses pan India.
However, it is still taking orders for essential items from its website. It is also only displaying essential products on its homepage such as handwashes, personal hygiene products, sanitary napkins, oral care products, etc.
"Please note we are only accepting prepaid orders for now on daily essentials. We have started deliveries to select pin codes in Mumbai, Pune, New Delhi and Bangalore. However, there might be some delays due to local constraints. We are doing our best to restart deliveries to other cities," a note on the website reads.
This comes even as Nykaa announced that it raised Rs 100 crore from Steadview Capital, an existing investor.
According to reports, this funding values the fashion retailer at $1.2 billion dollars, up from the previous valuation of $750 million when it raised Rs 100 crore from TPG growth.
Falguni Nayar, founder and CEO of Nykaa while announcing the fundraising said in a statement, “In the midst of this unprecedented global crisis we are working to ensure all our stakeholders are well served and that Nykaa emerges as a leading retail player in the industry.”