Price pinch: Buyers shift to small FMCG packs – Times of India
However, it may be early to term this as a trend. There was ‘overstocking’ from the previous month of March this year, a year-end time for businesses, when more stocks are ‘dumped’, said Akshay D’Souza, chief of growth and insights at Bizom, which is a platform that automates retail execution at 7.5 million kirana stores.
“In April this year, retailers picked up mostly the fast-moving low price packs as they already have the previous month’s stock. This can blur the picture a bit on whether or not there is downtrading for real. We will know if this is a trend in the next few months,” said D’Souza. He said what’s also to be factored in is the base effect in April 2022, due to the second Covid wave in 2021.
According to the latest data, in packaged foods, consumers shifted to low-priced packs (2.5% growth) from mid-priced (-0.5%) and high-priced (-2%) packs.
Parle Products senior category head Mayank Shah attributed the migration of consumers to smaller packs in April to two factors. First is inflation, and the second is that rural consumers have less cash in hand, given that this is a period just before the harvest. “This is a lean month in general for both urban and rural markets. Growth will improve May-end onwards,” said Shah.
In beverages, the mid-sized packs witnessed a decline (-11.7%), while low-priced packs (7.4% growth) picked up pace. High-priced packs also grew, at 4.3%, albeit at a slower pace than smaller packs.
While beverages could have been impacted by excess rainfall in several parts of the country, in branded commodities, too, smaller packs grew at 2.4%, clearly at the cost of mid-priced packs (-2.6%), while there was hardly any change in high-value packs’ offtake.
However, home care and personal care saw a different trend with mid-sized packs growing at a faster rate than lower-priced packs. Home care’s mid-priced segment saw a growth rate of 5.1%, while in personal care it was 3.3%. In both these categories, low-price packs contracted by a little over 4%.
During the March quarter, consumers up-traded to high-value packs in beverages, personal care and branded commodities as compared to the year-ago period.
function loadGtagEvents(isGoogleCampaignActive) { if (!isGoogleCampaignActive) { return; } var id = document.getElementById('toi-plus-google-campaign'); if (id) { return; } (function(f, b, e, v, n, t, s) { t = b.createElement(e); t.async = !0; t.defer = !0; t.src = v; t.id = 'toi-plus-google-campaign'; s = b.getElementsByTagName(e)[0]; s.parentNode.insertBefore(t, s); })(f, b, e, 'https://www.googletagmanager.com/gtag/js?id=AW-877820074', n, t, s); };
window.TimesApps = window.TimesApps || {}; var TimesApps = window.TimesApps; TimesApps.toiPlusEvents = function(config) { var isConfigAvailable = "toiplus_site_settings" in f && "isFBCampaignActive" in f.toiplus_site_settings && "isGoogleCampaignActive" in f.toiplus_site_settings; var isPrimeUser = window.isPrime; if (isConfigAvailable && !isPrimeUser) { loadGtagEvents(f.toiplus_site_settings.isGoogleCampaignActive); loadFBEvents(f.toiplus_site_settings.isFBCampaignActive); } else { var JarvisUrl="https://jarvis.indiatimes.com/v1/feeds/toi_plus/site_settings/643526e21443833f0c454615?db_env=published"; window.getFromClient(JarvisUrl, function(config){ if (config) { loadGtagEvents(config?.isGoogleCampaignActive); loadFBEvents(config?.isFBCampaignActive); } }) } }; })( window, document, 'script', );
For all the latest business News Click Here