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What is FMCG Products? • Fast Moving Consumer Goods (FMCG) or Consumer Packaged Goods (CPG) refers to the products that are sold quickly at low price rates. FMCG is an acronym for Fast Moving Consumer Goods that we buy from local supermarkets on daily basis. To be more precise. The absolute profit made on this kind of product is relatively small but as it is sold in large quantities so the holders and the businessmen concern to it get a notable profit on it. . • The things have high turnover at relatively low-cost. As the products are sold quickly so the products have gained the phrase "fast moving consumer goods".

Marginal profit but sold in large quantities 7. Extensive distribution networks 8. High turnover at relatively low-cost 3.• The main features of FMCG products from market's angle: 1. High volumes 6. Having fast move in the marketplace 5. Sold quickly 4. High stock turnover . Generally replaced and used for a short span 2.

dish/utensil cleaners.• We may categorize FMCG products as follows: 1. air fresheners. Personal Care I) Oral Care (Toothbrush. insecticides and mosquito repellents. Paste etc) II) Hair Care (Shampoo. Washing Up. Hair oil etc) III) Skin Care (Suns cream. feminine hygiene. toilet cleaners. body lotion etc) IV) Personal Wash (soaps etc) • 2. Household care (Household care fabric wash including laundry soaps and synthetic detergents Cleaning. metal polish and furniture polish. Bags & Foils etc) . paper products etc) • 3. Cosmetics and toiletries (perfumes. floor cleaners. deodorants.

your every desirous product just at a pound. . dairy products. In this pound-land you could get to purchase-. baked goods. pre-packaged foods. toiletries. stocks up huge latest FMCG products to be sold only at a pound. Besides. soft drinks and cleaning products are also among this categories have high turnover rates. Alcohol. fruits and vegetables are included in this genre. meat. Just at Pound in UK. • 5.• 4.

dairy products and baked goods – are highly perishable. fruits and vegetables. either as a result of high consumer demand or because the product deteriorates rapidly. pre-packaged foods. which are generally replaced over a period of several years. • FMCGs have a short shelf life. . Other goods such as alcohol. toiletries. soft drinks and cleaning products have high turnover rates.Scope • The term FMCG refers to those retail goods that are generally replaced or fully used up over a short period of days. weeks. or months. This contrasts with durable goods or major appliances such as kitchen appliances. and within one year. Some FMCGs – such as meat.

• From the consumers' perspective: – Frequent purchase – Low involvement (little or no effort to choose the item – products with strong brand loyalty are exceptions to this rule) – Low price • From the marketers' angle: – – – – High volumes Low contribution margins Extensive distribution networks High stock turnover .

PORTER’S FIVE FORCE MODEL .

the abnormal profit rate will tend towards zero (perfect competition). This results in many new entrants.Threat of new competition • Profitable markets that yield high returns will attract new firms. • The existence of barriers to entry (patents. Unless the entry of new firms can be blocked by incumbents.) The most attractive segment is one in which entry barriers are high and exit barriers are low. • Economies of product differences . which eventually will decrease profitability for all firms in the industry. rights. Few new firms can enter and non-performing firms can exit easily. etc.

• • • • • • • Brand equity Switching costs or sunk costs Capital requirements Access to distribution Customer loyalty to established brands Absolute cost Industry profitability. the more profitable the industry the more attractive it will be to new competitors. .

For example. • Buyer propensity to substitute • Relative price performance of substitute . Pepsi is not considered a substitute for Coke but water.Threat of substitute products or services • The existence of products outside of the realm of the common product boundaries increases the propensity of customers to switch to alternatives. tea. and coffee are.

as online product can easily replace material product.• Buyer switching costs • Perceived level of product differentiation • Number of substitute products available in the market • Ease of substitution. Information-based products are more prone to substitution. • Substandard product • Quality depreciation .

which also affects the customer's sensitivity to price changes. particularly in industries with high fixed costs . • Buyer concentration to firm concentration ratio • Degree of dependency upon existing channels of distribution • Bargaining leverage.Bargaining power of customers (buyers) • The bargaining power of customers is also described as the market of outputs: the ability of customers to put the firm under pressure.

• Buyer volume • Buyer switching costs relative to firm switching costs • Buyer information availability • Availability of existing substitute products • Buyer price sensitivity • Differential advantage (uniqueness) of industry products • RFM Analysis .

and services (such as expertise) to the firm can be a source of power over the firm. when there are few substitutes. labor. charge excessively high prices for unique resources. e. components.g. or. • Supplier switching costs relative to firm switching costs • Degree of differentiation of inputs . Suppliers may refuse to work with the firm. Suppliers of raw materials..Bargaining power of suppliers • The bargaining power of suppliers is also described as the market of inputs.

g.ability to forward vertically integrate and cut out the BUYER .• • • • Impact of inputs on cost or differentiation Presence of substitute inputs Strength of distribution channel Supplier concentration to firm concentration ratio • Employee solidarity (e. labor unions) • Supplier competition .

the intensity of competitive rivalry is the major determinant of the competitiveness of the industry.Intensity of competitive rivalry • For most industries. • Sustainable competitive advantage through innovation • Competition between online and offline companies • Level of advertising expense • Powerful competitive strategy .