Distributors want uniform packaging, claiming that smaller, lower-priced packages cause confusion

 Distributors want uniform packaging, claiming that smaller, lower-priced packages cause confusion

An industry body has suggested standardizing pack sizes into four major categories while claiming that smaller, lower unit-priced packages introduced by several consumer goods manufacturers to increase their addressable market have added additional strain to existing infrastructure and resources within the distribution network.

An industry body has suggested standardizing pack sizes into four major categories while claiming that smaller, lower unit-priced packages introduced by several consumer goods manufacturers to increase their addressable market have added additional strain to existing infrastructure and resources within the distribution network.

The government should standardize pack sizes and group products into four different categories—entry pack, small pack, medium pack, and large pack—to address the problem, according to the All India Consumer Products Distributors Federation (AICPDF).

Recently, some businesses unveiled a variety of new SKUs (Stock Keeping Units) with lower unit costs in an effort to appeal to the rural market. This has led to "price confusion" among consumers and "inventory management challenges," according to a statement from AICPDF.

According to AICPDF President Dhairyashil Patil, "The difference in per-gram pricing across a number of SKUs within the same price category has become a significant issue, as it frequently leads to consumer confusion."

Effective inventory management has become more difficult as a result of the companies' quick introduction of new SKUs.

Given the restricted storage space, this is particularly difficult, according to AICPDF, who also said that shops are reluctant to store more SKUs due to the complexity increase and potential for consumer confusion.

The group has requested standardizing pack sizes to the Ministry of Public Distribution through a delegation.

"By categorizing commodities into these standardised packaging sizes, it is expected to simplify the administration of inventory, reduce difficulty for retailers, and eliminate customer disorientation arising from multiple serial number units within the same price range under a single brand," the statement read.

A balance between market expansion and guaranteeing the efficient running of the distribution network is sought with this move toward standardization.

He continued, "AICPDF invites businesses to support these initiatives and join forces to create a more structured and consumer-friendly market.

AICPDF is the FMCG company with the largest inventory of dealerships, distributors, and retailers. In the entire nation, the association is a representative of about 4 lakh members.

The Indian FMCG industry experienced volume degrowth and poor customer sentiment following the outbreak. After six consecutive quarters of negative consumption growth, rural India's sales witnessed degrowth during the January–March 2023 quarter, according to data analytics company Nielsen IQ (NIQ).