FMCG volume growth in revival mode?

 

In 2014, FMCG volume growth may get a leg up from a low base effect but its effect on sales growth may get dented by the opposing pull of a high base effect on price-led growth. 

In 2013, the fast-moving consumer goods (FMCG) industry’s sales growth by volume rose by just 1%. Sales growth by value, however, gained 9% because of higher prices.

But falling volume growth points to the fact that price-led growth cannot be sustained for long.

The December quarter saw a glimmer of hope, according to the Nielsen Co.’s data.

Volume growth has reversed a slide that had begun in the December 2012 quarter although it is early to call it a recovery. Further help may be at hand from the base effect.

In 2014, volume growth may get a leg up from a low base effect but its effect on sales growth may get dented by the opposing pull of a high base effect on price-led growth.

 

 AKANKSHA SHNAU

PGDM 1st year.