Before moving on to the details of the FMCG sector, lets know what FMCG means. The full form of FMCG is Fast Moving Consumer Goods. Manufactured goods which have a quick turnover and comparatively low cost are termed as Fast Moving Consumer Goods (FMCG). They are those products which are normally consumed by the consumers at a regular interval. For instance, consumer products such as soap, toiletries, oral care products, shaving products, cosmetics and detergents, printing and stationery, household products, dairy products, drinks are examples of FMCG products. Also non-durables such as glassware, batteries, paper products, bulbs, plastic goods, etc. can be grouped under the category of the said products. This industry is also known as the CPG (Consumer Packaged Goods) industry.
The size of the Indian FMCG industry is expected to be worth Rs.1300 billion. This shows that the country’s FMCG sector has a competitive edge over many other countries.
The Indian FMCG market is vastly uneven and a sizeable part of the market consists of unorganized players who sell unbranded and unpackaged products. The situation here is completely reverse of the ones in the developed countries which are predominantly dominated by a few large players. In India, the FMCG kirana stores comprise of around 9 million out of the approx. 12-13 million retail stores in India.
Over the last decade, the sector has shown an average annual growth of about 11% per annum. There is a huge unexploited market potential which can be observed from the penetration level and the low per capita consumption in many product categories as compared to world average standards. Rapidly increasing Indian population, the middle class and the rural segments, in particular, presents the huge unexploited opening to FMCG players. The said industry provides a broad range of consumables and for that reason the amount of money circulated against FMCG products is also very high. Specifically in India, because of the booming competition among FMCG manufacturers and the growth in the same, the investment in FMCG industry is also increasing. The investors find the FMCG industry to be a very promising one.
The FMCG sector always plays safe. This is because, even in the times of recession, the demand for the household commodities and consumables doesn’t fall and remains constant. As a result of this, profits and Balance sheets of FMCG Companies remain unaffected. There is no danger for both, the players and the investors in the FMCG sector. The competition from emerging companies, low operational costs, rising standard of living of the consumers, constant demand, strong distribution system, etc. are encouraging the said industry to grow more.
The Top ten FMCG companies in India are as listed below:
1. Hindustan Unilever Ltd.
2. ITC (Indian Tobacco Company)
3. Nestle India
4. GCMMF (AMUL)
5. Dabur India
6. ASIAN Paints (India)
7. Cadbury India
8. Britannia Industries
9. Procter & Gamble Hygiene and Health Care
10. Marico Industries
The diverse agro-climatic conditions are the most favourable for the food processing industries in India. The improving infrastructure in the country is giving it a great advantage to tap into the huge unexploited rural market in India. From all this, it can be well understood that the Indian FMCG sector is quite stable and a promising one to assure growth in the economy of the country.