Fast Moving Consumer Goods/ Durables are popularly known as packaged goods and include all products purchased by consumers at regular intervals. The growing income of people, ease of access to a variety of goods, changing lifestyles and the growing influence of e-commerce websites are the main factors driving growth in the industry.
The Industry is the fourth largest in India. It is expected to grow at a compound annual growth rate (CAGR) of 14.7% in urban areas and at a higher CAGR of 17.7% in rural areas with the Industry poised to hit the 110 Billion USD mark by 2020 and the rural FMCG market to hit 100 Billion USD mark by 2025 .
FMCG’s are supplied mainly through two routes, one comprising of kirana stores and is the largest contributor to sales. However, Modern Trade is slowly catching up to the traditional methods of sale on account of them providing a comfortable and modern purchasing experience and competitive bargain details.Products like packaged foods, liquid/paper soaps, cereals etc. are distributed primarily via modern trade channels and this route is expected to grow further with the relaxed regulations regarding foreign direct investment in multi-brand retail.
The pro reform government having a full majority at the centre has led to a spectacular improvement in market sentiments. The revival of demand and the expansion and improvement of distribution networks make it the perfect time for investors to enter the sector.