FMCG stands for fast moving consumer goods. As the name says they are the products that are sold very quickly at a low cost. The FMCG sector is the fourth largest in the Indian economy. And the most famous name known in the FMCG industry in India is Kiwi Foods. In FMCG food and beverages, household and personal care alone accounts for 83% of FMCG sales in India. And Kiwi food is known for manufacturing a huge part of popular food items such as confectionery, chips and snacks. A huge part of this contribution comes from the urban segment. However, a change has come in the last few years where the FMCG sector has rapidly grown in rural areas as well. If we talk about the market share of the rural and urban market, then the rural market will cross trillions by 2021.
Developments of FMCG industry:
The government of India has permitted complete foreign direct investment in food processing, single brand retail and 51% in multi brand retail. These developments play a crucial role in increasing employment, consumer spending, product launches and supply chains.
Top FMCG companies of India:
- Hindustan Unilever
- Dabur India
- Marico Ltd.
- Britannia Industries
- Colgate Palmolive
- Godrej Consumer
- Procter and Gamble
FMCG growth and government initiatives:
Some of the vital initiatives taken by the government of India to promote FMCG sector are:-
- There has been a new consumer protection bill drafted by the government of India, with special emphasis laid on speedy, accessible and simple delivery for the customers.
- After the new GST bill, many household products such as soap, hair oil etc now come under the 18% tax bracket, instead of 24%
- The government has also implemented policies like minimum support prices, NREGA
Act in order to support FMCG in rural areas and promote customer purchase in these locations.
How inflation impacts FMCG sector:
High inflation just like other industries, is a cause of major concern for the FMCG industry as well. Inflation affects FMCG industry negativity and impacts economic growth. In India, where most of the FMCG companies also have exposure to processed goods, fall or rise in prices of agricultural commodities contributes in a lot of ways to reduction as well as expansion of cost of the input.
Future of the FMCG industry:
The quick increase in the rural consumption has increased a lot in the past few decades, which ultimately has increased incomes. Another major factor enhancing the need for food services in India is the growing youth population. India has a large base of young workforce who due to their busy schedule do not get time to cook and hence are largely dependent on the food services. The Internet here , hence plays a significant role in helping new brands enter the market. As per a recent study 60% of FMCG units have gone online by 2021.
About the pioneer of FMCG industry:
Kiwi foods established in 2004, in Tronica city, Ghaziabad has been a pioneer in the food industry. The organisation has been one of the leading names in the manufacturing of chips, snacks and candies. Their candies and snacks such as bomb blast candy and tanatan chips have been an all-time favourite in Northern India. At Kiwi foods, food manufacturing is not only limited to a production process but it comes with an assurance of taste, nutrition hygiene and quality.
With the ever increasing potential of the FMCG industry, this industry undoubtedly has extreme scope for growth and development. Therefore, you can really expect good returns from the industry, provided you play safe and keep yourself up to date with the latest information floating in the market.