FMCG

Summary:

  • Fast moving consumer goods (FMCG) is the 4th largest sector in the Indian economy, majorly comprising of household and personal care segments which account for half of the sector. It also includes food and beverages (19%), and healthcare (31%) segments..

  • Rural markets account 45% of the revenue share for the sector while urban market account for the remaining 55%

  • Indian FMCG market is expected to grow at a CAGR of 14.9% to USD 220 billion by 2025 from USD 110 billion as of 2020.

  • Major development in the Indian FMCG sector include the emergence of D2C startups like Mamaearth that breached the INR 100 crore revenue mark in just 4 years in comparison to major players like ITC that took nearly two decades.

  • FMCG companies are also looking to invest in energy efficient plants to benefit the society and lower cost in the long term.


Step 1

R&D

(Innovation of existing products and development of new products)

Step 2

Procurement

(Sourcing Raw material, quality test and release, storage)

Step 3

Manufacturing

(Production, Packaging, quality testing, storage)

Step 4

Distribution

(Centers & warehouses, channels - distributor, retailer, e-commerce)

Step 5

Sales/ Marketing (Branding, Advertising, Promotion, Complaints & feedback)

Cost Drivers

•Raw material and processing cost

•Distribution cost

•Promotion

Revenue Drivers

•Pricing

•Promotion

•Distribution

Growth Drivers

•100% FDI in food processing, single brand retail & 51% in multi-brand retail allowed by the govt

•Introduction of new and innovative products

•Growth of E-commerce

•Rising Per-capita income

Key Customers

•Household

Key Players

•HUL

•ITC Ltd.

•Nestle India Ltd.

•Britannia Industries Ltd.

•Godrej


Channels

•Dealers

•Retailers