The fast moving consumer goods (FMCG) segment is the fourth largest sector in the Indian economy. There are three main segments in the sector – food and beverages which accounts for 19 per cent of the sector, healthcare which accounts for 31 per cent and household and personal care which accounts for the remaining 50 per cent.
The market size of FMCG in India is estimated to grow from US$ 30 billion in 2011 to US$ 74 billion in 2018.
FMCG Companies are looking to invest in energy efficient plants to benefit the society and lower costs in the long term.
Growing awareness, easier access, and changing lifestyles have been the key growth drivers for the sector.
What are FMCG goods?
FMCG goods are popularly known as consumer packaged goods. Items in this category include all consumables (other than groceries/pulses) people buy at regular intervals. The most common in the list are toilet soaps, detergents, shampoos, toothpaste, shaving products, shoe polish, packaged foodstuff, and household accessories and extends to certain electronic goods. These items are meant for daily of frequent consumption and have a high return.
Rural – set to rise
Rural areas expected to be the major driver for FMCG, as growth continues to be high in these regions. Rural areas saw a 16 per cent, as against 12 per cent rise in urban areas. Most companies rushed to capitalise on this, as they quickly went about increasing direct distribution and providing better infrastructure. Companies are also working towards creating specific products specially targeted for the rural market.
The Government of India has also been supporting the rural population with higher minimum support prices (MSPs), loan waivers, and disbursements through the National Rural Employment Guarantee Act (NREGA) programme. These measures have helped in reducing poverty in rural India and given a boost to rural purchasing power.
Hence rural demand is set to rise with rising incomes and greater awareness of brands.
With rise in disposable incomes, mid- and high-income consumers in urban areas have shifted their purchasing trend from essential to premium products. In response, firms have started enhancing their premium products portfolio. Indian and multinational FMCG players are leveraging India as a strategic sourcing hub for cost-competitive product development and manufacturing to cater to international markets.
According to the study conducted by AC Nielsen, 62 of the top 100 brands are owned by MNCs, and the balance by Indian companies. Fifteen companies own these 62 brands, and 27 of these are owned by Hindustan UniLever.
The top ten India FMCG brands are:
1.Hindustan Unilever Ltd.
2. ITC (Indian Tobacco Company)
3. Nestlé India
4. GCMMF (AMUL)
5. Dabur India
6. Asian Paints (India)
7. Cadbury India
8. Britannia Industries
9. Procter & Gamble Hygiene and Health Care
10. Marico Industries
What the millenniums expect
According to a study by TMW and Marketing Sciences that surveyed 2,000 people across different age groups ranging, young consumers are the most ‘rational’ and likely to spend more time weighing up potential purchases. The survey also suggests that younger people are using recommendations from their peers about products and services in order to make rational purchase decisions. According to the study, shoppers aged 18 to 24 are 174 per cent more likely to use recommendations on social media than shoppers aged 25 and over.
Another key factor today is – speed. Today’s consumer wants packaged goods that work better, faster, and smarter. The “ need for speed” trend highlights the importance of speed as a potentially decisive purchase factor for packaged goods products in a world where distinctions between products are shrinking.
Younger consumers express the greatest need for speed, not a huge surprise for the smartphone generation. Datamonitor’s 2013 Consumer Survey found that younger consumers those in the 15-24 year old age group were twice as likely to say that “results are achieved quickly” has a “very high amount of influence” on their health and beauty product choices than consumers in the oldest age group, those aged 65 or older. Speed matters, and 2014 will almost certainly see the introduction of new game-changing timesavers.
FMCG brands would need to focus on R&D and innovation as a means of growth. Companies that continue to do well would be the ones that have a culture that promotes using customer insights to create either the next generation of products or in some cases, new product categories.
One area that we see global and local FMCG brands investing more in is health and wellness. Health and wellness is a mega trend shaping consumer preferences and shopping habits and FMCG brands are listening. Leading global and Indian food and beverage brands have embraced this trend and are focused on creating new emerging brands in health and wellness.
According to the PwC-FICCI report Winds of change, 2013: the wellness consumer, nutrition foods, beverages and supplements comprise a INR 145 billion to 150 billion market in India, is growing at a CAGR of 10 to 12%.
Most Popular Job Searches for FMCG?
- State head (Sales)
- Regional Head (Sales)
- Area Sales Manager
- Territory Sales Manager
- Sales Manager/Sales Officer
- Store Manager/Store In charge
Starting Salary (for Fresher) – 150000-18000/Anum for Sales Officer/Manager
for an experienced candidate can get up to 16LPA
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