Mitesh Shah, 38 is the Managing Director for Nirvanaa Chocolates, a Belgium chocolate brand that offers ‘ultimate luxury chocolates’ at affordable prices. In this role, Mitesh defines and manages the vision as well as the strategy of the company. Due primarily to Mitesh’s vision and efforts, Nirvanaa Chocolates has boosted and is growing at a fast rate of 100% per month despite of the lockdown and the pandemic rising at its peak.
A country like India in its developing phase reaction is even higher. Many sectors have gone through severe changes like loss of jobs in the tourism sector due to travel restrictions, and decreased demand for travel has affected the aviation industry. Like most of the sector, Fast Moving Consumer Goods (FMCG) has also faced a sudden change and adversely affected. Fast Moving Consumer Goods (FMCG) is a dynamic sector in the Indian economy with high consumer demand; due to its consumer demand, it is often purchased and consumed rapidly. The growth of the industry is increasing day by day with varied forms. The urban sector is the largest contributor, but in the recent phase, the rural sector contribution is increasing rapidly. In this pandemic recession, it has undergone a drastic stage. The main reasons are lack of labour, operations limiting to production, increased knowledge in health and hygiene, boost the demand for sanitizer, hand wash, tissue, etc., and improved demand for organic goods results in a shift in consumer preference.
Consumers are shopping differently, with more evolved journeys and expectations. They now demand more product personalization, which means that shipping completed products will no longer cut it. Instead, companies have to transport raw materials that can then be put together locally, dependent on individual customer needs. That requires a complete change in not just supply chain management, but also inventory management.
E-commerce companies focusing on grocery sales also recorded an initial spike in sales due to people being confined to their homes, but many later had to halt operations due to logistics issues. E-commerce is expected to benefit over the long run, with a greater number of consumers developing an online grocery shopping habit.
Non-grocery specialists, especially apparel and footwear specialist retailers, which went into complete shutdown, will witness a larger impact on their revenues. It will take a few more months after the lockdown for retailing operations to normalise, while a period of precautionary measures would lead to a shift in consumers’ shopping channel preferences.
Most companies order products as much as six months in advance. Usually, most of those products would go straight onto shelves into retail stores. Now, however, with many stores limiting in-person shopping and a huge number of people buying online, that chain is broken. Add to this the various costly disruptions and bottlenecks in the supply chain, and you have a system in need of restructuring. Coronavirus pandemic shows an unprecedented change globally. It shows that FMCG is affected uncommonly with many factors like Labours moved to their natives, logistics issues, and changes in the consumer basket.
It is difficult for anyone to make marketing decisions in person during the COVID-19 pandemic, since close contact with other people poses a health risk. In this situation, technology makes it faster and more efficient to improve entrepreneurial marketing decisions.
Speedier digitalization of the value chain. Another expected outcome of the pandemic is increased digitalization of the value chain through automation and the more widespread use of AI—not only for cost efficiency and productivity, but also to make supply more resilient and transparent through real-time tracking. The result could be a greater need to integrate technology.
he importance of supply chain management integration model cannot be overemphasized because of its importance to the success of business in all parts of the world and that for organizations to remain competitive, their SCM must be integrated in such a way that information, supplier and funds flow from the supplier’s provider to the consumer point of sale, seamlessly.
This comes on the back of the worst economic slowdown in a decade that the government was trying to revive prior to the COVID-19 outbreak. Euromonitor International predicts that Indian real GDP could dip into negative territory in 2022 depending on the severity of the COVID-19 crisis.
Indian consumers are paying more for essential products including edible oils, staples, personal and home care products. The rising prices of essential goods have hit lower- and middle-income households hard as higher healthcare costs during the pandemic have already hit savings.
The pandemic has put the spotlight on health and safety, prompting businesses in the food industry to invest in innovation. Evolving consumer preferences are expected to encourage businesses to see the long-term benefits of keeping products fresh with a shorter shelf life.“The demand for traditional Indian foods that rank high on taste, freshness, health and convenience will continue to grow. We are also seeing a growing demand for immunity-boosting foods, such as curd and coconut water, as well as products that are eco-friendly.
In the immediate to medium term, I see a lot of changes in consumer behaviour, due to which FMCG companies will be forced to adapt their strategy for customer acquisition and retention. The composition of the consumption basket has changed due to the COVID Pandemic and some of these changes will be more permanent than others. An increased focus on health and hygiene will become the norm. Demand in the discretionary categories is likely to come back slowly but not immediately.
We can conclude by saying-
We are witnessing a paradigm shift in consumer behaviour, businesses and business models, wherein there will be a decline of certain businesses, and slowdown in others. A pandemic of this nature has opened our eyes to how vulnerable human life can really be – these are those rare times when every human being is on a quest for survival. Those who come out of this victorious, businesses and people alike, will be the ones who would have adapted to the new normal faster than others. The impact of Covid-19 on the Fast Moving Consumer Goods sector can be felt – organisations which can adapt quickly to the changing demand patterns and show agility in thought and execution will be the ones who gain market advantage.