The Indian industry has a delayed recovery in comparison to other countries, but the FMCG sector has touched pre-Covid-19 level sales in June primarily helped by a rebound in rural consumption and sales from traditional channels, said data analytics firm Nielsen on Friday.
According to Nielsen, both urban and rural sales are growing but the recovery/sales from the undeveloped semi-urban/rural quarters are much faster and traditional trade channels as neighbourhood and Kirana stores have scored over modern trade outlets as retail outlets and hypermarkets.
Compared with other global markets such as China, Malaysia, Indonesia and Thailand, the industry in India has witnessed a delayed growth recovery due to extended lockdowns, said Nielsen President – South Asia Prasun Basu.
Though it has taken three months, we are kind of coming back to the levels, which we had left behind at the end of last year and the beginning of this year Q1 period. If that was 100 in the index, then today we are at 98, which is almost recovered. Good news is that it is a clear recovery but a slowish recovery, said Basu.
The FMCG industry had a sharp decline in April .It started recovering in May (25 per cent decline) and in June, it returned almost to pre-Covid-19 level, said the Nielsen report.
Nielsen is comparing the average sales data of December, January and February and from June. It has dropped March for the baseline comparison as according to Basu, it was the month when there was panic buying in the segment with lots of pantry uploading.
According to Nielsen Global Connect West Market Leader – South Asia Sameer Shukla, the growth recovery is led by rural and traditional channels.
Rural is the major contributor toward that recovery. It's not that urban has not recovered as it had a higher dip in April and May and then gain. In rural, the dip was not that significant, he said.
Over baselines of 100 of December, January and February sales, rural has now recovered to 109, while the urban trade is 92, while the traditional trade has come to 101 as against 78 of the modern trade, which includes big format retailers.