Demand for Fast Moving Consumer Goods (FMCG) has decreased. Retailers and distributors are facing difficulty in selling products. There is weakness in demand, due to which their stores and warehouses are filled with goods. According to Dhairyasheel Patil, President of All India Consumer Projects Distributors Federation, sales have been poor in this year’s festive season.
He said that even after Diwali the sales have been very low. Especially the sales of biscuits and chocolates have decreased significantly.
Despite no increase in prices, sales decreased
Sales of gift packs have also been low during the festive season. Its stock is also full in stores. Patil said that even gift packs have not been sold this year and we have not been able to clear the stock yet.
In the non-food segment, the condition of beauty and cosmetics products is the worst. After this comes soap and detergent. The thing to note is that even after bringing back the price hike of most of the companies, sales have decreased.
Managing increasing inventory is also costly. According to Patil, the cost of handling excess stock is huge and this is increasing the problems. According to AICPDF, which represents four lakh distributors and stockists across the country, the average inventory holding days have increased from 7-15 to 25-30.
Delay in getting payment to traders
Apart from this, the average credit period for retailers for units with fast moving stock is now 25–26 days. Usually, retailers make payments to distributors within about 7 to 8 days. Due to delayed payments, retailers are asking their suppliers not to send new products.
Consumer goods companies are also worried about the situation. But poor demand is not the only problem. Due to modern and e-commerce platforms, normal business has also been affected.
