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Indians are buying more packs of grocery products, but their consumption per gram has fallen

Indian households are buying more packs of grocery products than pre-pandemic levels, but their consumption per gram has fallen about 14% as pack sizes have shrunk drastically, research firm Kantar said in its FMCG Pulse report.

Compared to the pre-pandemic period, India is shopping more frequently and buying more packs, and average monthly sales of fast-moving consumer goods (FMCG) packs in the country stood at 19.2 billion, or 62 packs per household, from April to August 2022, significantly higher than monthly sales of 15 billion packs, or 51 packs per household, before the Covid-19 outbreak.

But the increase is on account of shrinking pack sizes. While the packs bought pre-pandemic weighed on average 438 grams, the size has shrunk to just 309 grams now amid soaring inflation, the report said.

Nearly all consumer goods companies reduced the weight of multiple packs while keeping price points intact as prices of commodities such as palm oil, wheat, sugar, and coffee hit record highs. The increase in the number of packs bought is most significant in food products.

Before the pandemic, about 23 packs of food products were purchased by a household every month on average; however, between May and August 2022, this jumped to 31 packs, Kantar said. Categories like chocolates, soft drinks, biscuits, salty snacks, and noodles continue their growth, while health and hygiene products saw a steep decline this year, the report said.

“This means that the pandemic codes are slowly expiring and indulgence has peaked,” it said. For example, in August 2022, 18% fewer volumes of health and hygiene products were purchased than in September 2020. The fall in volumes was 8% from September 2021.

“None of the hygiene categories made significant long-term gains because of the pandemic, as these categories only influenced consumer behaviour for a season but could not have a major impact on their general behavior,” Kantar said.

Chyawanprash, which created waves because of its immunity positioning in the early days of the pandemic, fell a steep 75% while honey declined 56% during the same period. Large companies including ITC, Dabur, and Marico have either discontinued or pulled off shelves products like sanitizers, disinfectants, and sprays with the Covid-19 pandemic receding and consumer demand dipping sharply.

Most of these companies have launched multiple products amid a sharp spike in demand after the pandemic outbreak.

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