Small Packs, Big Costs: FMCG Firms Face Tough Choices

Rising input costs and food inflation are pushing FMCG companies to rethink their low-priced packs of Rs 5 and Rs 10. With commodity prices like palm oil, coffee, and cocoa up 50-60% this year, brands such as Parle Products aim to keep these price points “sacrosanct” by reducing product size rather than leaving the segment. Parle’s Rs 20 packs, which currently make up 12-14% of food sales, are expected to hit 25% in the next few years. The Rs 10 segment is forecasted to reach 25% of volume share, with Nestlé and Godrej Consumer Products also adjusting their prices to manage shrinking margins and rising urban costs.

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