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What Is FMCG

Understanding the FMCG Industry


Fast moving consumer goods (FMCG) is the Indian economy’s fourth largest growing sector. Products coming under FMCG are very extensive- they are usually the products that are sold at low prices and consumed quickly. Unlike durable goods, they are also sold in high volumes and are used rapidly. Dairy products, toiletries, confectionary, bread, fruits and vegetables etc are examples of FMCG products. Food and beverages account for 19% of the sector. Healthcare accounts for 31% and household and personal care account for 50% of the share. Factors like lifestyle changes, urbanisation, change in product consumption due to increase in middle class income led to a positive impact on FMCG industries in India. 30 new ‘wave cities’ have emerged in India for example Jaipur and Surat which causes increased consumption in these cities. Growing usage of smartphones and fast spreading internet connectivity all over the country also expands the e-commerce sector.

Working of a FMCG Product


The key to the FMCG industry is their products. Quality goods and services of a company help them thrive. In Indian scenario the biggest FMCG companies are Tata Consumer, Nestle, Britannica, Hindustan Unilever, ITC, Godrej etc. Nearly all Indian households consume their products. Since these products have a small profit margin, they are sold in mass quantities. A FMCG company will sell a certain amount of products with a margin of 5-10% profit margin but it does so 40 times. This ultimately leads to large profits. Gaining profits from a product lies mainly in how a company executes it’s strategies and makes consumers buy its product.

Strategies Used by Companies Include-

  • Multi branding- One company produces a range of products in the same genre to create a string place in the market.
  • Brand Extension– An already established brand starts a new line of products with the added advantage of previous product sales.
  • Evolution- Making changes in the products to meet contemporary needs.
  • Continuous advertising– Constant advertisement of a product on all types of Media.
FMCG product store


Stages of a FMCG Product


I- The first stage is the introduction of the product. The company launches the product in the market and tries to increase its demand. This is usually done with free product samples. This helps both the producer and consumer- they can check out how the product is performing, what issues it might have etc.

II- This is the growth stage where the product is in the market and its sale is increasing.

III- During this stage i.e., the maturation stage sales are at their peak and product costs start to decline. Other competitive companies launch their own products with similar features in this stage.

IV- In the last Declining stage, the product is stopped. The sales drop and consumers also shift to other products and gaining profits becomes really difficult.

The FMCG industry has changed dramatically over the years and still has a lot of promise. FMCG sector will surely develop even more as it continues to grow and improve. There is plenty of room for profit, and as we get better at battling the epidemic, the earnings of the firms will rise. Myanmar Golden Heart is a corporation that offers the greatest distribution services to its customers. 

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