India’s retail and FMCG landscape continues to evolve against a backdrop of price sensitivity, shifting demand, and regional disruptions. At the heart of FMCG sales, the Rs 5 and Rs 10 price points remain non-negotiable anchors for companies, sustaining affordability and high-volume demand. Ahead of the September 22 GST rate revision, retailers are bagging heavy discounts of up to 20% as firms clear inventories to adjust to the new tax regime.
Yet, challenges persist. Escalating unrest in Nepal has forced players like Britannia and Dabur to halt or scale down operations, while at home, retail inflation edged up to 2.1% in August, nudged by higher food and personal care prices, though still comfortably below the RBI’s 4% target. Meanwhile, quick commerce is surging in India but proving loss-making in China, raising regulatory alarms there. On a brighter note, Reliance Retail’s Tira and L’Oréal Paris are merging beauty with fashion, bringing Paris Fashion Week flair to Indian consumers.
Click on the headings below for insights on how these trends are shaping India’s retail landscape…
1. No small change: Why Rs 5 and Rs 10 rule India's FMCG sector
Indian FMCG companies fiercely protect the Rs 5 and Rs 10 price points, viewing them as crucial for reaching the vast consumer base at the bottom of the pyramid. These price points are psychological anchors, ensuring affordability and driving high-volume sales. Companies prioritize maintaining these prices, even adjusting grammage to avoid disrupting consumer habits and established supply chains.
2. FMCG retailers bag big discounts ahead of GST rate shift on September 22
Consumer Major fast-moving consumer goods (FMCG) companies are offering retailers quantity purchase schemes, providing a 4-20 per cent discount on a range of products, ahead of the implementation of new goods and services tax (GST) rates from September 22. These discounts are valid until September 21, as firms seek to manage stock and adjust to the revised tax structure.
3. Unrest in Nepal forces Indian FMCG giants to halt or delay ops
Indian FMCG companies such as Britannia Industries have suspended operations in Nepal due to escalating civic unrest and violent protests. Britannia has halted manufacturing at its Simara plant, while Dabur has directed employees to work from home.
4. Retail inflation inches up to 2.1% in August
Retail inflation inched up in Aug, led by some hardening in prices of meat and fish, oils and fats, personal care & effects and eggs, but remained in the comfort zone which may prompt RBI to maintain a pause on interest rates for now. Data released by the National Statistics Office (NSO) on Friday showed retail inflation, as measured by the consumer price index (CPI), rose an annual 2.1% in Aug, up from 1.6% in July but below the 3.7% in Aug last year.
In India, Quick Commerce is reshaping grocery retail by driving new demand, changing buying habits, and creating business and job opportunities. But in China, despite rapid growth, it has become a strain, major players like Alibaba, Meituan, and JD.com are locked in a costly “instant retail” battle for one-hour delivery, eroding profits and raising government concerns over deflationary pressures.
Leading luxury beauty brand L’Oréal Paris has teamed up with Tira, Reliance Retail’s pioneering beauty platform, for Paris Fashion Week. As part of this exclusive collaboration, the two companies has unveiled 'Runway to Paris', an initiative with the main aim is to highlight future of Indian fashion and beauty.
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