Wednesday, March 29, 2023

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FMCG sales grow despite high costs

MUMBAI: The year 2022 saw the fast-moving consumer goods (FMCG) industry clocking a 7.3% growth in terms of sales value. The expansion came despite unprecedented inflation and global commodity headwinds following the Russia-Ukraine war. The number highlights how businesses found a way to deal with challenges and close the calendar year in positive terrain.
Beverages had a stellar growth of nearly 23%, according to Bizom, a platform that automates retail execution at 7.5 million kirana stores. Home care, however, shrank by 8.5% and, as discretionary spends were curtailed due to the third Covid wave in the early part of the year%. Revenge-shopping during the festive season helped confectionery to report a 1.6% growth in 2022, according to Bizom‘s data.
Bizom’s chief (growth & insights) Akshay D’Souza said, “Inflation did bite and it led consumers to focus more on priority products and lesser on discretionary ones this year. Most consumer product companies were happy looking at price-led growth in the early part of the year. But it soon became clear that consumers were looking for value options that became the focus towards the later part of the year.”
Dabur India’s CEO Mohit Malhotra said the inflationary environment and resultant price hikes saw consumers tightening their purse-strings and even downtrading to smaller packs. “The impact of inflationary pressures was more pronounced in the rural markets even as e-commerce and modern trade drove growth in urban markets. We hope to see a revival in rural demand in 2023,” said Malhotra.
In a report, Abneesh Roy of Nuvama Group, said, “Belying its old-line image, India’s FMCG sector has shown remarkable agility in keeping up with the times by resorting to online sales across segments.”

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