NEW YORK (Reuters) - Online retailer Gilt Groupe Inc does not plan to go public this year and may not consider it in 2011 either, but will focus on growing domestically, Chief Executive Susan Lyne said.
The members-only retailer, which sells luxury clothing, accessories and home goods at an average discount of about 65 percent, also does not have any immediate capital needs, and is not likely to be a takeover target, Lyne said at the Reuters Global Luxury Summit in New York.
“Being a private company is extremely useful for us right now,” said Lyne, a former media executive who also served as head of Martha Stewart Living Omnimedia MSO.N before she joined Gilt.
Gilt has been growing at a breakneck pace since the recession has turned shoppers off to full-price purchases, while a fledgling recovery has renewed their appetite for nice-to-have items.
The company has seen sales surge from $25 million in 2008 to $170 million in 2009 and projects $400 million to $500 million this year.
As a private entity, Gilt has more flexibility to invest as it chooses, making it easier to run the company, Lyne said.
The online retailer, which sells to women mostly, but is also branching out into travel, said it is not looking at expanding into international markets immediately.
“That does not mean we won’t look at it hard and fast in another six months. There’s a lot of opportunity here right now, and we just launched a lot of businesses here. We want to keep the focus as much as we can on making sure those businesses really work,” Lyne said.
Right now, the company’s profits come from the margins it makes on the products sold, but Lyne said there could be other potential revenue streams in the future.
“You could do a concierge program, you could do a special high-end membership in Gilt that did include a fee, but those are a long way off,” she said.
However, Lyne said she would be “reticent” about doing anything — such as posting advertisements on the website — that might hurt the attributes that make people like Gilt, such as its ease of use and sparkling visual presentation.
(Editing by Bernard Orr)
Reporting by Nivedita Bhattacharjee, editing by Michele Gershberg