8/6/2019 FMCG_writeup

http://slidepdf.com/reader/full/fmcgwriteup 1/4

 

The Rs. 85,000 crore FMCG market in India is making rapid strides irrespective of the

downward economic trend. Increased income and standard of living has been the spearhead inFMCG sector. Consumer mindset has now changed to ³Value for Money´ from ³Money from

Value´. Relaxed FDI conditions in India have inducted many global players in Indianmarket.Companies like HUL,Dabur & ITC have outperformed their counter peers in the Indian

market due to their consistent class performance and new quality of innovations.

Fast moving consumer goods (FMCG) sector in India is one of the largest sectors in the economy

with estimated total market size of around Rs 110,000 crore in 2010. The FMCG market in Indiais expected to reach Rs 1,80,000 crore by 2015.

8/6/2019 FMCG_writeup

http://slidepdf.com/reader/full/fmcgwriteup 2/4

Market Share of FMCG Products 

Indian FMCG market is strongly supported by a chain of strong MNC¶s. This sector requireshigh expenditure on branding. Most companies in the sector create customer value through

 product differentiation, package innovation, differential pricing and highlighting the functional

aspect of their products.

Nano marketing is one of the greatest achievements made by the FMCG industry which has

aided the companies to manufacture products in smaller package sizes, at lower price and reachnew users from the lower income group as well as to expand market share for value added

 products in urban area. The trend was introduced by Hindustan Lever, a subsidiary of Unilever inmid 1990s when it started packing products in small sachets. Today, nearly all the products like

oil, shampoo, detergents etc are available in sachet form in the market.

New Market for FMCG

India has a high population of approx 350 million from middle class strata. This mass has a

 potential to create huge demand. With economy expected to grow at 8 % ± 10 % rate per annum

8/6/2019 FMCG_writeup

http://slidepdf.com/reader/full/fmcgwriteup 3/4

the standard of living and the disposable income of the individuals will increase. Changing

lifestyle will put more importance on personal care products .The demands will eventually be

directed to the FMCG sector for various FMCG products.

The rural class which was unexplored until recently is a great scope. With communication and

awareness penetrating the rural arena there is a huge expectation for change in the lifestyle andthe necessity of the products in the rural areas. This would bring more market for the FMCG

industry

Checkpoints in FMCG Industry

Tapping customer necessity with ease accompanied with the use of technology is the key to

FMCG industry. However this sector is boggled due to high production cost. The industry faces

a lot of pressure due to any rise in Inflation level. Inflation rate in India as on May, 2011 was

8.72 %.Higher inflation rate can certainly erode the disposable income even in a growing

economy.FMCG market has always been against any hike in excise duty levied in consumer goods and services. In Union budget 2011, the base rate on excise duty was increased from 4%

to 5 %. An increase in excise duty not only affects the production and distribution cost but also

tampers the demand in FMCG sector.

8/6/2019 FMCG_writeup

http://slidepdf.com/reader/full/fmcgwriteup 4/4

FMCG in International arena

The international economy has led to a rapid pace in demand for FMCG products. The major¶stop line FMCG products of global market are growing day by day. The consumer goods like

soap, shampoo, skin cream, face wash, Make Up items, Lipstick, nail paint and cosmetics are

like to bring up a huge market for FMCG

Bottled water major Bisleri International on June 8, 2011 said it is looking at entering Middle

East countries as part of its strategy to expand its overseas presence. As part of the plan, thecompany said it will consider setting up more manufacturing facilities outside India.

Vast range of consumable goods offered by the FMCG industry involves a huge amount of 

money, while the contest among FMCG manufacturers is turning out to be a lot fiercer than ever  before. We are witnessing people investing a lot of money into the FMCG industry, especially in

United States, where the FMCG industry is by far the largest sector, and is estimated to doublefor every upcoming year. In New Zealand to add with, the FMCG industry has reported to

account for 6% of Gross Domestic Product, what we call as GDP.

Less inclination and time to cook at home implies eating out more often, a trend that is most

  prevalent in the USA, where meals eaten outside account for almost half of the food budget,nearly double the proportion spent in 1970.Car culture and distances traveled has also spawned

the hugely undesirable practice of eating and drinking in cars. In the USA, the car is fast becomean integral part of places to eat and drink. According to a University of Michigan research paper,

almost 10% of all meals in America are now eaten in a car, but figures as high as 20% have also been quoted. Eating or drinking in a moving vehicle is not very smart, but it is a phenomenon

that is occurring with growing frequency. What will also likely grow is the use of the stationary

car as a place to eat. Such growing demand presents packaging opportunities for well designed,easy-to-open and dispose of packaging appropriate for the stationary vehicle environment. 

Innovative packaging designs that allow a one-handed meal that fits easily into a car cup holder 

to be consumed without creating a mess provides immense ease the customer.These trends are all part of an overall picture of increasingly hectic lifestyles that has created a demand for new food

and beverage products packaged in a way that offers user convenience. To meet these challenges,many lightweight, single-serve containers that are easily consumed on-the-go are being

developed. Soup is a favorite with packaging designed for on-the-go portability with an easy-open, microwaveable, package that provides a quick meal; a self-heating smart packaging for 

soup is commercial in the USA. Other examples include grab µn go squeezable yogurt in a tube,

and fruit to go in single-serve easy peel clear plastic bowls.

On the whole the FMCG industry is gearing up for a rapid boom. With quick adaptation to

changing lifestyle the demand market will certainly widen and create new avenues in

future.