Emerging trends in the FMCG Sector -Opportunities for distributors

FMCG sector has been one of the sectors which has been able to counter the pandemic wave. The FMCG sector is growing at 14.7 percent, the FMCG sector has been projected to grow to a market size of almost US$ 220 billion by 2025.

This opens up a lot of opportunities both for the companies and manufacturers and the supply chain which includes distributors, wholesalers and retail outlets.

The household goods and personal care products amounting to up to 50 percent of FMCG sales in the country and the FMCG sector has proven to be India’s fourth-largest income-generating sector.

Key factors which are expected to drive the growth are:

The evolution in the lifestyle of Indians across the semi-urban and rural segments. Increase disposable income in the hands of ordinary people, especially from rural areas, will benefit the sector
While the urban segment of India contributes to almost 55 percent of FMCG sales, there has been a faster and broader growth for the FMCG sector in rural India.
Almost 50 percent of the money spent in rural India has been spent on an FMCG product.
Smaller Brands are Evolving to Reach a Wider Audience which need to penetrate newer markets
No longer is the FMCG sector a space occupied only by the big companies and brands that have always been around.
Increase in homegrown brands that promise to deliver chemical-free, all-natural FMCG products.
Consumer base shifted their loyalty from big brand names to smaller newer brands and products.
The ease of selling their products digitally or via social media made the private labels brands capture a substantial market size in a relatively short time.

.The focus on agriculture, MSMEs, education, healthcare, infrastructure, and tax rebate under Union Budget

Foreign-directed investments, the FMCG sector saw a robust FDI inflow of US$ 18.19 billion in the past year alone.

All the above factors indicate a rapid surge in the requirement of supply chain partners hence this is the right time for getting into the distribution business specially in the FMCG which will see a lot of demand in the coming months and years. This is due to the fact the more and more companies MNC, smaller manufacturers will try to expand their distribution to newer markets, newer channels and try out newer modes to supply their customers in the cost-effective manner. Thus, opening a large number of opportunities for newer supply chain partners in the form of Carrier and forwarding agents, distributors.

The next few years will be full of opportunities and the ones who decide to utilise the same will come out as winner.

So are you ready to take the plunge …?