Consumer goods distributors seek standardisation of product pack sizes 

The All India Consumer Products Distributors Federation (AICPDF) has voiced concerns over the proliferation of smaller, lower-priced product packages by consumer goods manufacturers, citing their strain on existing distribution infrastructure. To address this, the AICPDF has proposed that the government standardise product pack sizes into four distinct categories: entry pack, small pack, medium pack, and large pack.

Price confusion concerns

In response to companies introducing various stock-keeping units (SKUs) with lower unit prices, particularly targeting rural markets, the AICPDF has expressed concerns about "price confusion" among consumers and the resulting inventory management challenges. Dhairyashil Patil, President of AICPDF, highlighted the issues arising from varying per-gramme pricing within the same price bracket, causing consumer confusion.

The rapid introduction of new SKUs by companies has made inventory management more complex, especially with limited storage space. Retailers have been hesitant to carry additional SKUs due to the increased complexity and potential consumer confusion. A delegation from AICPDF has proposed pack size standardisation to the Ministry of Public Distribution.

The aim of standardising pack sizes is to simplify inventory management, reduce complexity for retailers, and eliminate confusion among consumers stemming from multiple SKUs within the same price range under a single brand. This standardisation effort seeks to strike a balance between market expansion and the efficient operation of the distribution network.

Organised and consumer-friendly market

AICPDF has urged companies to support these standardisation efforts to create a more organised and consumer-friendly market. The association represents approximately 4 lakh members across the country and plays a pivotal role in the distribution of Fast-Moving Consumer Goods (FMCG).

After experiencing volume degrowth and low consumer sentiment in the wake of the pandemic, the Indian FMCG industry faced challenges. However, according to data analytics firm Nielsen IQ (NIQ), rural India witnessed positive consumption growth during the January–March 2023 quarter after six consecutive quarters of degrowth. In response to changing consumer sentiments, many FMCG companies introduced smaller, lower-priced packages, starting at Rs 5, to counter the consumption slowdown.

(With PTI Inputs)