Small packs amid big bills: Indians reshape shopping habits as inflation hits budget
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“Due to price hikes, consumers are going for smaller packs, which negatively impacts volume,” the analysts noted.
Faced with relentless inflation, fast-moving consumer goods (FMCG) companies have been compelled to raise prices, especially during the December quarter. Hindustan Unilever (HUL) and Godrej Consumer Products (GCPL) implemented price increases of about 10% in their soap segments, while snack manufacturers like Bikaji and Tata Consumer raised the prices of snacks and tea, respectively.
«We are in the process of taking one or two more price hikes, and I think that should be enough,» Saugata Gupta, Managing Director and CEO of Marico, told ToI.
However, these price adjustments come with their own challenges. Higher prices are causing consumers to shift from larger packs to smaller ones, dampening the quarterly volume growth of companies. An analyst pointed out, «If consumers move from buying, say, a 1 kg pack of tea and multi-pack soaps to a 500-gram tea pack and one or two soaps, it will definitely impact quarterly volume growth of companies.»
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