FMCG is also called the consumer packaged goods sector. The scope of FMCG industry in India is growing especially in rural areas. There are 638000 villages in India. 70% of the population live in the rural area. Hence it is vivid that the rural India is the best market ever for the FMCG industry. The key segments of FMCG sector are:

Household care

• Fabric Wash
• Household cleaners

Personal care

• Oral care
• Hair care
• Skin care
• Personal care
• Perfumes
• Toiletries
• Deodorants
• Feminine hygiene

Food & Beverages

• Soft drinks
• Snack food
• Chocolates
• Ice cream
• Tea & Coffee
• Processed fruits and vegetables
• Juices
• Branded sugar
• Bottled water
• Branded flour
• Branded rice
• Staples/cereals
• Dairy products

Some of the fast moving consumer goods in India are:

• Wipro
• Tata
• Kellogg’s
• Nestle
• Cadbury
• Pepsi
• Britannia
• MTR
• Henkel
• Heinz
• Kraft
• Dabur
• Cavin kare
• ITC
• Nirma
• Godrej group
• Grove limited
• Hindustan Unilever limited
• Parle Agro
• Amul India
• Johnson & Johnson
• Proctor and Gamble

Top 10 FMCGs (based on market capitalization)

1. ITC    (Market capital:  280654 CR)
2. Hindustan Unilever    (MC:  159272 CR)
3. Nestle India   (MC:   57251 CR)
4. Dabur India   (MC:  37259 CR)s
5. Godrej consumer products (MC:  4752 CR)
6. Proctor and Gamble India  (MC:  22.76 B)
7. Marico (MC:  193.17 B)
8. Emami  (MC:   152.84 B)
9.  Colgate-Palmolive Combined (MC: 57.39 B)
10. Glaxosmithkline Consumer  Healthcare  (MC: 101.06 B)

SWOT Analysis

Strengths

• Low operational costs
• Well known Brands
• Presence of established distribution
• Better  understanding of consumer needs and roots in the local culture

Weaknesses

• Low export levels
• Counterfeit products
• Lower scope of investing in technology and achieving economies in scale, especially in small sectors
• High advertising costs

Opportunities

• Export potential
• High consumer goods spending
• Untapped rural market
• Rising income levels and changing lifestyles
• Large domestic market
• Opportunity in food industry

Threats

• Slowdown in rural demand
• Tax and regulatory structure
• Removal of import restrictions resulting in replacing of domestic brand

Indian FMCG market segment

• Baby Care – 2%
• Fabric Care – 12%
• Food Products – 43%
• Hair Care – 8%
• Household – 4%
• OTC Products – 4%
• Others – 5%
• Personal Care – 22%

The post Changing Trends in FMCG Industry in India – Written by Vishnupriya appeared first on Vskills Blog.

Fast moving consumer goods (FMCGs)  are the products that are consumed in short span of time and are consumed daily. Examples are packed food items, soft drinks, soaps, toiletries etc.  The FMCG industry can be broadly divided into 3 segments :

• Household care : fabric wash and household cleaners
• Personal Care : oral care, health care, skin care, cosmetics, hygiene and paper products
• Food and Beverages: bakery, chocolates, snacks, tea/coffee, diary products etc

The FMCG industry is the fourth sector is the fourth largest constituent of Indian economy and has a market size of about 130,000 crore. In the early ninties, FMCG marketers figured out two things:

• the rural markets are price-sensitive
• the rural markets are really important since the urban markets are getting saturated.

This led to a number of companies in following strategies for launching package sizes and prices to suit the purchasing sizes of the Indian consumer markets. This led to the introduction of small sachets in all segments from oil,shampoo to beverages. Sachets led to the concept of trial consumption.

FMCG growth is a function of

• create brand and product awareness
• increasing consumer demand
• growth of modern trade
• launching new products
• availability of online channel to shop
• rise incomes led to purchases
• desire to experiments with brands
• evolving consumer lifestyles

Main characteristics of FMCG are:

From the consumers’ perspective :

• frequent purchase
• low involvement and price

From the marketers’ angle:

• high volume
• low contribution margins
• high stock turnover
• extensive distribution networks

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