FMCG companies In a post corona world-

FMCG sector has become the key player of market ,as demand for household has increased 10
time over the last few days, especially in the period 21-day lockdown in India.

The FMCG sector has performed very well in the stock market

Companies like Nestle, HUL, ITC, P&G, GODREJ Consumer, DABUR ,AMUL and others are
set to gain sudden gush of demand.

A Nielsen report shows that there has been heavy stockpiling of not only essential food
items but also indulgence items like biscuits, chocolates, salty snacks and cookies.

Challenges-

1-Production and supply challenges due to reduction in staff which causing the delay
in delivery.

2-Change in consumer behaviour

Change in consumer behaviour-

1- Due to this pandemic we can see increase in consumer interest in health and
hygiene products, leading to purchase of safety items such as hand sanitizers and
face masks.
2- As the disease spread, consumers started stockpiling their pantry with shelf-
stable food and broader assortment of health and safety products. Store visits went
up and the basket size expanded.

3- The quarantine stage, followed by restrictive living, led to a rise in online

shopping, fewer store visits, purchase of essential goods.

4- consumers starts paying very close attention to how brands are handling hygiene
protocols and, more importantly, how they are executing them through each and
every touch point.

5- Consumers are not buying packaged food they are buying only fresh food.

How company should tackle with this pandemic-

1--Focus on improving the visibility of own e-commerce website

2-Field staff and company workers-

The consumer good companies rely heavily on on-field, factory and distribution
centre staff. To ensure the safety of these employees, companies should
encourage the rotation based shifts and minimal workforce in a bid to limit
physical contact with one another.

"All of our sourcing units and distribution centres will apply specialist
tiered protocols to protect our workers while supporting business
continuity. All field sales employees should connect with customers
virtually wherever possible and minimize the use of public transport if a
customer visit is necessary," said Unilever in a statement.

1- Increase: Digital (official media, short video, social news and info sites）

2-Maintain: OTT, Online video (news and drama)

3- strengthen the e commerce and delivery services

Focus on3R’s

1- Re- evaluate digital marketing effort

2- Regroup marketing efforts
3- Restructure digital assets

Effect on the ice cream industry-

for ice cream makers, the four months of the summer season account for over 40
per cent of the annual sales. This year, since February, the demand has been dull,
first due to the extended cold weather conditions and then the corona virus
outbreak.

Milk availability - milk procurement has increased, but consumption has gone slow
as bulk buyers such as hotels and restaurants remain closed.

This has diverted a larger part of liquid milk to skimmed milk powder (SMP), which is
one of the key ingredients for ice cream players.

reduced off-take and increased stocks of SMP may bring down the prices. But with
no demand during the peak season, the ice cream players are less likely to have a
cost advantage.

liquid milk procurement has increased, but consumption has dipped as bulk buyers
such as hotels and restaurants remain closed.

This has diverted a larger part of liquid milk to skimmed milk powder (SMP), which is
one of the key ingredients for ice cream players. A reduced off-take and increased
stocks of SMP may bring down the prices. But with no demand during the peak
season, the ice cream players are less likely to have a cost advantage.

Impact on dairy industry-

 DAIRY industry has suffered 25-35%dip down in demand , ice cream industry
sells has fall of 50-60% .
 15%Demand is slowing down as it was coming out from restaurants and small
tea stalls as they have been closed.
 Marriages also not happening, which is decreasing the buying of bulk milk .
 Dip in procurement price.
 Dairy industry using the surplus milk making the SMP (skimmed milk powder)
and white butter .
 Paneer, ghee sales is increasing ,because consumer is consuming it more

Company is also finding new way to reach there customer -

1-Direct distribution of milk and other product- Cream line and Lactalis have there
own vans in the residential localities.

2- They are also thinking to give the product to direct sell who unemployed

E.g- small tea stall owner

3- Direct distribution is doing great other then the e commerce

Amul readjusts-

“The sales are drastically down. The ice cream sector will definitely get impacted
because of the slump in demand during this peak season. For Amul, it may not be a
big problem as we may shift to other products, but those players dealing
exclusively in ice creams will surely face the challenging times,” said RS Sodhi

Changes which we can see around

 The Covid-19 pandemic has changed the way we work, shop and communicate
with people
 As more people start working from home, they are sticking to basics, stepping
outside only to buy essentials and are constantly worried about the risks of
getting infected in crowded places like malls and supermarkets
 E-commerce and online grocery-

The e-commerce and online grocery delivery service have also become a key
sector in the wake of the novel corona virus pandemic. As people have been
locked down in their homes due to the government’s order, delivery of essential
goods has been allowed by the government.

Some of the companies whose businesses are expected to boom during the
period are Big Basket and Grofers who have witnessed a mountain of orders after
have now started delivering all essential goods.

Many online grocery delivery services are now being joined by major e-
commerce companies Flip kart and Amazon, who are delivering only essential
goods in the wake of the Covid-19 pandemic.

It won’t be surprising if all these companies see an exponential rise in their

profits during the period of lockdown

 Content surge-

There has been a sharp spike in online content consumption and internet usage
during the first week of the lockdown, said the Business Today report quoting a
consumer survey. Some of the bigger players like Netflix, Amazon Prime and
Disney Hot star are also expected to see a rise in profits during the period

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