Ratio Analysis Fmcg
Fast-moving consumer goods (FMCG) or consumer packaged goods (CPG) are products that are sold quickly and at relatively low cost. The term FMCGs refers to those retail goods that are generally replaced or fully used up over a short period of days, weeks, or months, and within one year. This contrasts with durable goods or major appliances such as kitchen appliances, which are generally replaced over a period of several years.
FMCG have a short shelf life, either as a result of high consumer demand or because the product deteriorates rapidly. Some FMCGs – such as meat, fruits and vegetables, dairy products and baked goods – are highly perishable. Other goods such as alcohol, toiletries, pre-packaged foods, soft drinks and cleaning products have high turnover rates. An excellent example is a newspaper- every day 's newspaper carries different content, making one useless just one day later, necessitating a new purchase every day.
The following are the main characteristics of FMCGs:[1]
• From the consumers ' perspective:
• Frequent purchase
• Low involvement (little or no effort to choose the item – products with strong Brand loyalty are exceptions to this rule)
• Low price
• From the marketers ' angle:
• High volumes
• Low contribution margins
• Extensive distribution networks
• High stock turnover Examples include non-durable goods such as soft drinks, toilees, and grocery items.[1][2] Though the absolute profit made on FMCG products is relatively small, they generally sell in large quantities, so the cumulative profit on such products can be substantial.
Fast-moving consumer electronics are a type of FMCG and are typically low priced generic or easily substitutable consumer electronics, including lower end mobile phones, MP3 players, game players, and digital cameras, which have a short usage life, typically a year or less, and as such are disposable.
FMCG sector in India
The fast-moving consumer goods (FMCG) sector in India is the fourth largest
FMCG have a short shelf life, either as a result of high consumer demand or because the product deteriorates rapidly. Some FMCGs – such as meat, fruits and vegetables, dairy products and baked goods – are highly perishable. Other goods such as alcohol, toiletries, pre-packaged foods, soft drinks and cleaning products have high turnover rates. An excellent example is a newspaper- every day 's newspaper carries different content, making one useless just one day later, necessitating a new purchase every day.
The following are the main characteristics of FMCGs:[1]
• From the consumers ' perspective:
• Frequent purchase
• Low involvement (little or no effort to choose the item – products with strong Brand loyalty are exceptions to this rule)
• Low price
• From the marketers ' angle:
• High volumes
• Low contribution margins
• Extensive distribution networks
• High stock turnover Examples include non-durable goods such as soft drinks, toilees, and grocery items.[1][2] Though the absolute profit made on FMCG products is relatively small, they generally sell in large quantities, so the cumulative profit on such products can be substantial.
Fast-moving consumer electronics are a type of FMCG and are typically low priced generic or easily substitutable consumer electronics, including lower end mobile phones, MP3 players, game players, and digital cameras, which have a short usage life, typically a year or less, and as such are disposable.
FMCG sector in India
The fast-moving consumer goods (FMCG) sector in India is the fourth largest