Coronavirus impact: FMCG volume growth 4.9% in Sept quarter

Fast-moving consumer goods market expanded significantly by volume in the September quarter. FMCG market expanded 4.9 per cent by volume in the September quarter buoyed by increase in sales in the hygiene category and in-home snacks. This expansion is the impact of coronavirus pandemic in the market.

According to a study by consumer research firm Kantar Worldpanel, without the COVID-19 impact the market would have grown much slower at 0.8 per cent instead of 5.3 per cent in the urban areas. K Ramakrishnan, MD, South Asia, Worldpanel Division at Kantar said that COVID seems to have rescued the industry from a possibly underwhelming performance. Growth, he says, seems to have been three times of projected trends in the second quarter and appears to be more in the third quarter.

In the initial months of the lockdown in April and May, the market grew at 3.9 per cent, hit by supply and distribution disruptions. In the next two months, the FMCG sector saw a growth of 4.8 per cent due to delayed breakout in the rural areas. Demand further improved to 5 per cent after the opening-up period of August and September as offices reopened partially.

According to the report, high growth was not only concentrated in the early pandemic months that saw a surge in panic buying but also in the months that followed.

The Kantar report said that brands with bigger reach managed to increase their volume but smaller companies lost volume. Kantar looks at consumption of branded as well as unorganised products.

Also read: Rural India hooked to packaged food; delivers 11x growth over metros