A

PROJECT REPORT

ON

“Industry Analysis & Desk Research: FMCG Industry”

In Partial Fulfillment of the Subject

IADR (215)

Submitted By

Amit Sharma (C- 47)

Guided By

Mr. Uttam Sapate

Submitted To

Marathwada Mitra Mandal’s

Institute of Management Education and Research Training (IMERT)

(2019-20)

1
 DECLARATION

We all , the undersigned, hereby declare that the Project Report entitled “Industry Analysis &
Desk Research: FMCG Industry” in partial fulfillment of the subject IADR (215) under the
guidance of Prof. Uttam Sapate is my original work and the conclusion drawn there in are based
on the material collected by myself.

Place:

Date: Sharma Amit

C: 47

2
 INDEX

CHAPTER CHAPTER TITLE PAGE NO.

NO.

1. Introduction 5

2. Company Profile 8

3. Industry Profile 10

4. Research methodology 12

5. Data Analysis And Interpretation 14

6. Findings and Conclusions 20

3
 List of Graphs & Images

GRAPH NO. NAME OF GRAPH PAGE NO.

2.1 Revenue share of India 8

2.2 Annual Growth Rate 9

3.1 Sales Revenue 10
3.2 Industry Leader 11
5.1 Porter five Force model 14
5.2 Pest Analysis 15
5.3 Swot Analysis 16
Company Analysis 17

5.4 HUL 17
5.6 ITC 18
5.7 Dabur 19

4
 CHAPTER 1
INTRODUCTION
Fast Moving Consumer Goods (FMCG)

We regularly talk about things like butter, potato chips, toothpastes, razors,
household care products, packaged food and beverages, etc. But do we know under which
category these things come? They are called FMCGs. FMCG is an acronym for Fast Moving
Consumer Goods, which refer to things that we buy from local supermarkets on daily basis, the
things that have high turnover and are relatively cheaper. FMCG’s constitute a large part of
consumers’ budget in all countries. The retail sector for FMCG’s in India is in the process of a
drastic transformation. The transformation of the retail market is likely to have a long-lasting
impact on wholesale trade and the distribution of FMCG’s as well. Traditional wholesalers are
the most likely losers, because large retailers tend to buy directly from suppliers. The Indian
FMCG sector is the fourth largest sector in the economy, with a total market size in excess of
US$ 13.1 billion. It has a strong MNC presence and is characterized by a well established
distribution network, intense competition between the organized and unorganized segments and
low operational cost. Availability of key raw materials, cheaper labor costs and presence across
the entire value chain gives India a competitive advantage.
FMCG are products that have a quick shelf turnover, at relatively low cost and don't
require a lot of thought, time and financial investment to purchase. The margin of profit on every
individual FMCG product is less. However the huge number of goods sold is what makes the
difference. Hence profit in FMCG goods always translates to number of goods sold.
Fast Moving Consumer Goods is a classification that refers to a wide range of frequently
purchased consumer products including: toiletries, soaps, cosmetics, teeth cleaning products,
shaving products, detergents, and other non-durables such as glassware, bulbs, batteries, paper
products and plastic goods, such as buckets. ‘Fast Moving’ is in opposition to consumer durables
such as kitchen appliances that are generally replaced less than once a year. The category may
include pharmaceuticals, consumer electronics and packaged food products and drinks, although

5
these are often categorized separately. The term Consumer Packaged Goods (CPG) is used
interchangeably with Fast Moving Consumer Goods (FMCG).
Three of the largest and best known examples of Fast Moving Consumer Goods
companies are Nestlé, Unilever and Procter & Gamble. Examples of FMCGs are soft drinks,
tissue paper, and chocolate bars. Examples of FMCG brands are Coca-Cola, Kleenex, Pepsi and
Believe.
The FMCG sector represents consumer goods required for daily or frequent use. The main
segments of this sector are personal care (oral care, hair care, soaps, cosmetics, and toiletries),
household care (fabric wash and household cleaners), branded and packaged food, beverages
(health beverages, soft drinks, staples, cereals, dairy products, chocolates, bakery products) and
tobacco.
The Indian FMCG sector is an important contributor to the country's GDP. It is the fourth
largest sector in the economy and is responsible for 5% of the total factory employment in India.
The industry also creates employment for 3 m people in downstream activities, much of which is
disbursed in small towns and rural India. This industry has witnessed strong growth in the past
decade. This has been due to liberalization, urbanization, increase in the disposable incomes and
altered lifestyle. Furthermore, the boom has also been fuelled by the reduction in excise duties,
de-reservation from the small-scale sector and the concerted efforts of personal care companies
to attract the burgeoning affluent segment in the middle-class through product and packaging
innovations.
Unlike the perception that the FMCG sector is a producer of luxury items targeted at the
elite, in reality, the sector meets the every day needs of the masses. The lower-middle income
group accounts for over 60% of the sector's sales. Rural markets account for 56% of the total
domestic FMCG demand. Many of the global FMCG majors have been present in the country for
many decades. But in the last ten years, many of the smaller rung Indian FMCG companies have
gained in scale. As a result, the unorganized and regional players have witnessed erosion in
market share.

6
History of FMCG in India

In India, companies like ITC, HLL, Colgate, Cadbury and Nestle have been a dominant
force in the FMCG sector well supported by relatively less competition and high entry barriers
(import duty was high). These companies were, therefore, able to charge a premium for their
products. In this context, the margins were also on the higher side. With the gradual opening up
of the economy over the last decade, FMCG companies have been forced to fight for a market
share. In the process, margins have been compromised, more so in the last six years (FMCG
sector witnessed decline in demand).

7
 CHAPTER 2
COMPANY PROFILE

Products and Categories: -

Personal Care, Oral Care, Hair Care, Skin Care, Personal Wash (soaps); - Cosmetics and
toiletries, deodorants, perfumes, feminine hygiene, paper product; Household care fabric wash
including laundry soaps and synthetic detergents, household cleaners, such as dish/utensil
cleaners, floor cleaners, toilet cleaners, air fresheners, insecticides and mosquito repellents, metal
polish and furniture polish - Food and health beverages, branded flour, branded sugarcane,
bakery products such as bread, biscuits, etc., milk and dairy products, beverages such as tea,
coffee, juices, bottled water etc, snack food, chocolates, etc.

a. Value of Turn over

 The FMCG sector in India generated revenues worth US$ 49 billion in 2018.
 By 2020, the revenues of the sector are forecasted to reach US$ 104 billion.
 Accounting for a revenue share of around 60 per cent, rural segment is the largest
contributor to the overall revenue generated by the FMCG sector in India and recorded a
market size of around US$ 29.4 billion in 2017-17.
 Semi-urban and urban segments are growing at a rapid pace and accounted for a revenue
share of 40 per cent in the overall revenues recorded by FMCG sector in India.

2.1

8
b. Average annual Growth Rate and Forecasted Annual Growth Rate

2.2

 In the long run, with the system becoming more transparent and easily compliable,
demonetization is expected to benefit organized players in the FMCG industry.
 The growth in sales of major FMCG companies like Dabur, HUL, Marico, in the June-
September 2017 quarter, is signaling the revival of consumer demand in India.
 Direct selling sector in India is expected to reach Rs 159.3 billion (US$ 2.5 billion) by
2021, if provided with a conducive environment through reforms and regulation.

9
 CHAPTER 3
INDUSTRY PROFILE

 Major Competitor

1. Top 5 FMCG Companies in India

1. Hindustan Unilever Ltd.

2. ITC (Indian Tobacco Company)
3. Marico
4. GCMMF (FMCG)
5. Dabur India

2. Sales Revenue
3.1

10
3. Industry Leader

3.2

11
 Chapter 4
Research methodology
A. Type of Research: - Descriptive research

Descriptive research is also called Statistical Research. The main goal of this type of research is to
describe the data and characteristics about what is being studied. The idea behind this type of
research is to study frequencies, averages, ratio and other statistical calculations. Although this
research is highly accurate, it does not gather the causes behind a situation.

The regular interaction with the Customers and the Line Managers revealed about the various
strategies involved in performing business activities and gathering data using various techniques
and software applications

Descriptive research includes Surveys and fact-finding enquiries of different kinds. The main
characteristic of this method is that the researcher has no control over the variables; he can only
report what has happened or what is happening.

B. Data Collection
There are two types of data:

 PRIMARY DATA:

The data that is collected first hand by someone specifically for the purpose of facilitating the
study is known as primary data. So in this research the Primary data is not collected.

 SECONDARY DATA:

For the company information I am using secondary data like brochures, web site of the company,
Annual report of the company, etc.

The Method used by me is Survey Method as the research done is Descriptive Research.

12
C. Scope of Research
Following are the key effective area of research of scope in FMCG industrysuch as
 To define the core mechanism of FMCG
 To Know the daily working process and to channelize this in our knowledge system
 To define the limitation of work
 To understand the daily transaction limit
 To know over seas transfer process
 To understand the variability in the operational process
 To assue the need of customer safety and security protocol to FMCG.

D. Limitation of Research
The main limitation of this research are as
 Not subject to primary research such as Individual data collection
 Based on earlier research ( Empirical Research )
 Time constraint.
 The area conducted for research study was very limited.

 The information provided by the bank on website was very limited as bank executives

refused to disclose marketing strategies directly.

E. Data analysis tool

 Potter Five Model

 Pest Analysis

 Swot Analysis

 Company Analysis

13
 Chapter 5
Data Analysis & Interpretation
Porter’s Five Force Frame Work Analysis

5.1
Interpretation:
 According to model bargaining power of suppliers give positive impact to FMCG
Industry
 This industry have negative impact because Availability of same and similar product
alternatives
 The factors which customer focuses while purchasing FMCG products are
 Price Availability Brand name
 Quantity Quality Packing
 Advertisement Reference
14
PEST Analysis

5.2

Interpretation:
 According to economical factor, FMCG is the 4 largest sectors in India.
 The profit is increase because major young generation cooperates with
FMCG, that’s why it’s come under Social Factor.
 Foreign players also help to increase technological development.
 FMCG helps to agriculture sector and distribution ruler area so it’s come
under political factor.

15
Swot Analysis

5.3

16
 Company Analysis of FMCG Industry

5.4

17
5.5

18
5.6
19
 CHAPTER 6

FINDINGS AND CONCLUSIONS

Findings:

1. It is found in the Desk Research that females are the main decision maker for the FMCG
products. As per the Economic Time, 65% of female and 35% of male makes purchase
decision.

2. Based on the occupation of the customer, it is found in the ibef.org site that 65% are the
housewives and 35% are from various occupations such as a businessman, employee,
farmers, etc for the FMCG products.

3. The main purchasing factors for the FMCG products are Quality and Brand image. The
data reveals that 42% influences on Quality and 32% influenced for the Brand.

4. According to TOI, 88% of the people in India are using product since from a long time.
The majority of the person is using FMCG products from more than 3 years.

5. It is found in the Research that customer are influencing through Word of Mouth

Conclusions:

From the desk Research conducted it is observed that FMCG products have a good
market share. From the study conducted the following conclusions can be drawn. The factors
considered by the customer before purchasing FMCG products are freshness, taste, durability
and easy availability.

Finally I conclude that, majority of the customers are satisfied with the FMCG products
because of its good quality, reputation, easy availabilities. Some customers are not satisfied with
the FMCG products because of high price, lack of availability, spoilage and low shelf life etc.
therefore, if slight modification in the marketing programme such as dealers and outlets,
promotion programmers, product lines etc., definitely company can be as a monopoly and strong
market leader.

20