Saugata Gupta, the managing director and CEO of Marico Ltd, believes that India’s fast-moving consumer goods (FMCG) industry is facing increased competition from both small and large players. On one hand, direct-to-consumer (D2C) brands are gaining traction with niche offerings, while on the other hand, regional players have returned to the market after facing supply chain disruptions during the pandemic. As a result, the competition is becoming more complex and challenging.
According to data from NielsenIQ, smaller FMCG firms reported a 9.7% jump in year-on-year volumes in the December quarter, more than double the 4.4% growth posted by larger industry giants. This trend is forcing established companies to adapt and acquire emerging brands to strengthen their portfolios.
Marico, in particular, has made strategic acquisitions, including a majority stake in Apcos Naturals, Plix, and Beardo, to expand its portfolio and position itself for growth. The company is also focusing on improving its distribution channels, including launching its “Setu” initiative to increase direct reach in urban and rural markets.
Gupta believes that the key to success in this complex market is to be able to anticipate risks and opportunities, and execute with agility and resilience. He also notes that consumption has not yet fully recovered, and companies must innovate to compete for consumer spending across various categories, including travel, dining, and other discretionary expenses.
The rise of digital-first consumer brands has further intensified the competition, with many of these startups shifting their focus towards strategic exits rather than scaling independently. Marico and other established players are likely to continue adapting to this changing landscape, which will likely see a wave of consolidation in the FMCG industry.