Opportunity in crisis: FMCG firms use pandemic to focus on volume, margin

Towns and rural areas have led the revival in FMCG segment since June, with the trend expected to last at least for the next two quarters.

Topics
FMCG companies | Coronavirus | FMCG sector

Viveat Susan Pinto  |  Mumbai 

The coronavirus pandemic has helped fast-moving consumer goods (FMCG) companies to focus on volume and profit growth: a practice considered difficult because of the nature of the industry. Margin expansion takes a hit when companies chase volume growth, as the product mix is skewed towards mass-market items that are not considered to be margin-accretive.

Premium products are margin-accretive but they are restricted to a smaller base of people, influencing volume growth. The pandemic, however, has seen consumers seek value and trust, giving a leg-up to organised FMCG players. ...

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First Published: Tue, November 10 2020. 19:51 IST
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