Question

can someone help me to pharaphrase this

The fast-moving consumer goods sector is the 4th largest sector that contributes to India’s GDP. It has grown from U.S. Dollars (USD) 31.6 billion in 2011 to USD 49 billion in 2016 (IBEF, 2017). Its principal constituents are household care, personal care and food and beverages. Growing awareness, easier access, and changing lifestyles are the key growth drivers for the consumer market. The market is expected to maintain a high growth rate as the middle class, semi urban and rural populations are rapidly adopting branded FMCG products.

Distribution is very critical to the success of FMCG companies in India. The variables in distribution management are so dynamic that companies have to constantly experiment and devise better market classifications and route planning methods.

Even after the latest researches undertaken in studying the distribution models of FMCGs in India, there have been frequent changes, innovations in the marketplace when it comes to practice. On seeing limited acceptability of organized trade in smaller geographies, FMCG companies are going rural with innovative approaches. Successful initiatives like HUL’s Project Shakti and ITC’s e-Choupal indicate that rural India is at the focus of FMCG companies. Their attempts at tweaking distribution methods are influenced largely by an urge to drive volumes from rural markets and values from their urban counterparts.

However, in this spree to go rural, FMCG companies tend to overlook the erstwhile satellite towns which are in the growth phase. Peripheral areas of smaller cities are often left neglected and underserved as geographical markets. This results in a gap in fulfilling the FMCG demand of the consumers residing in these areas. These are the consumers who thanks to the increased television reach, better electricity coverage and an access to fast and easy internet services over hand-held devices have an updated exposure to the latest and best among FMCG products.

Answer 1

Fast Moving Consumer Goods (FMCG) are the products which are sold quickly with relatively less shelf lives and are sold at less margin. The FMCG companies aim to generate profits through a high volume of sales by aiming at increasing their market share.

Some products that come under FMCG are household care, personal care and food and beverages etc. Some FMCG companies are ITC, HUL etc.

In India, FMCG is a rapidly growing sector which is also the fourth largest contributor to the GDP. It has grown from U.S. Dollars (USD) 31.6 billion in 2011 to USD 49 billion in 2016 (IBEF, 2017).

The key drivers of growth in the FMCG sector are

• Growing Awareness about the products, brands etc in the consumers
• The increase of accessibility of the products to the customers
• Changing Lifestyles of the consumers.

The FMCG market is expected to grow as the as the middle class, semi-urban and rural populations are adopting to buy branded FMCG products due to the above reasons.

To be successful in this market with high growth rate the FMCG companies should be able to have very effective and efficient distribution systems to make the products available to every nook and corner of the country at very competitive prices. With changing market environments the companies need to constantly experiment and devise better market classifications ( Through STPD) and route planning methods ( Optimal Routes).

In villages the FMCG Companies are facing a problem of the unacceptability of their branded products as more importance is given to the local unbranded merchandise. To counter this the FMCG Companies are going for innovative approaches for rural India. Some of such innovative approaches are HUL’s Project Shakti and ITC’s e-Choupal. They indicate that the village markets are FMCG companies focus.

Due to focussing more on the village markets and by designing and modifying their distribution systems to make more and more products available to each and every village, the FMCG companies are missing to gain the advantage of the market growth in the satellite towns which are growing. The consumers have better electricity coverage, television reach and internet facilities. So there is infrastructure which is readily available for the FMCG Companies to market their products. The consumers in these satellite towns are facing problems of their demands not fulfilled by the FMCG Companies. This indicates that the markets there are less competitive for FMCG Companies and targeting them would be beneficial to them.