fmcg sector main 97-03

8/6/2019 Fmcg Sector Main 97-03

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FAST MOVING CONSUMER

GOODS


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Bella Waghralkar - 17

Clyde Fernandes - 25

Shivani Mitkar - 31

Sweta Mayekar - 43

Jayesh Zingade - 49


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Fast Moving Consumer Goods (FMCG) goods are

popularly named as consumer packaged goods.

Non-durable goods

Sold quickly at relatively low cost at large quantities.

Touches every aspects of human life.

Sub segments viz: personal care, oral care, and

household products.


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Detergents

Soaps

Beverages

ShampoosConfectionaries

Creams


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Per Capita Consumption(US$)

0

2

4

6

8

10

12

India China Thailand South Africa

Laundry Shampoo Skincare Deodrants

Per capita consumption in US$


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Name ofFMCG

Market sizein $ Million

Market Sharein %

MarketShare in %

Indian

Comp

anies

MNCs Indian

Comp

anies

MNC

s

1992 2004 1992 2004

Breakfast,

Cereals

2 25 100 0 52 48

Wafers,Potato chips

6 35 100 0 37 63

Washing

Machines

40 570 98 2 51 49

TV 630 3030 97 3 49 51


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India is important market for FMCG products.

The Indian FMCG sector is the 4th largest in theeconomy.

Total market size of around US$18 billion as of2007.

During 1950s to 1980s there was a lowinvestment as the purchasing power was low.

The govt. had put a lot of emphasis on thedevelopment of small scale sector.

The existing companies like HUL were purely focused

on the urban area.


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15

10

11

168

40

Savings Others Clothings

Entertainment Personal Care Grocery


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Wanted for - necessity, comfort, luxury.

Significant part of the consumer's budget.

Spends little time on the purchase decision.

Limited inventory of these products.

Brand switching is often induced by heavy

advertisement and recommendation.


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STRENGTHS:

Low operational costs

Presence of established distribution networks in bothurban and rural areas

Presence ofwell-known brands in FMCG sector.

WEAKNESS:

Lower scope of investing in technology and achieving

economies of scale, especially in small sectors Low exports levels

"Me-too" products, which illegally mimic the labels of theestablished brands. These products narrow the scope ofFMCG products in rural and semi-urban market.


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OPPORTUNITIES:

Untapped rural market.

Rising income levels, i.e. increase in purchasing power ofconsumers.

Large domestic market- a population of over one billion

.

Export potential.

High spending on consumer goods.

Changing Profile and Mind Set of Consumer.

THREATS:

Removal of import restrictions resulting in replacing ofdomestic brands.

Slowdown in rural demand.

Tax and regulatory structure .


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Availability ofraw materials

Presence across value chain

Labor cost comparison


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CONSUMERS:

More choices available.

Purchasing power

increases , especially inrural areas.

Demand shift from basicproducts to morepremium lifestyle

products.

Willing to pay premiumprices for some lifestylechoice.

FMCGPlayers Increase growth via price

hike

Keep pulse on new

customer insights andproduct developments tocater to changing needs

Focus on growth engines:health and personal careproduct categories

Penetrate rural areas

Invest into creativepromotions.


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HINDUSTAN UNILEVER LIMITED

AMUL

DABUR INDIA LIMITED


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No 1 company in India

Sales turnover of Rs 13,718 croresProduces 35 different brands with

15,000 employees


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4th largest company in India

Sales turnover of Rs 2745.74 crores

It has 15 different brands with 20,000

employees


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6th largest company in India

Sales turnover of 2,396 croresIt has 32 different brands with 6,500

employees


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21/24

0

5

10

15

20

25

30

35

HUL AMUL DABUR

35

15

32

20

11

17

BRANDS CATEGORY


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Government spending is huge in this sector.

A major portion of the monthly budget of each household

is reserved for FMCG products.

Customer spends a lot on this sector.

The volume ofmoney circulated in the economy against

FMCG products is very high, as the number of products

the consumer use is very high.

Increase in overall GDP which leads to increase in real

income.

Easy flow of capital in the economy.

Competition in the FMCG sector is very high resulting in

high pressure on margins.


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fmcg sector main 97-03

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