Consumers shopping for groceries and various other items related to daily use will get 10-15% more discount this festive season as compared to the last two quarters.
A large number of firms are planning to provide amazing pricing offers and promotional schemes after quiet December quarters in the last two years. Firstly, demonetisation in November 2016 and then goods and services tax (GST) rollout in July 2017, both the things have a great effect on consumption.
Hemant Malik, who is the ITC divisional chief executive in foods, said, “We will create special offers across price points for the festive season across our brands of juices, biscuits, chocolates, and confectionery. Consumers find value in such special options.”
He further added, “We are optimistic about the offtake of these products during the festive season and expect demand to be better than last year.”
Wholeseller Metro Cash & Carry will provide discounts which Kirana stores can forward it to the customers.
Arvind Mediratta, Chief Executive of the company said, “The upcoming festive quarter will be the first after two years when there will be no after-effect of either demonetisation or GST. We expect sales to be very strong.”
The business-to-business wholesaler, which follows an October-September financial year, is also launching an ‘own business day’ in October in order to gain more customers, including large firms such as Procter & Gamble, Dabur, Colgate Palmolive, and Nivea selling products at low prices to neighborhood retail stores.
Mayank Shah, category head at biscuits and snacks maker at Parle Products, said, “We are creating multiple pricing and packs for trade and consumers, including for organised trade and kirana stores for the festive quarter.” He added, “We are, however, ensuring that we don’t disrupt existing equations with any of our trade channels.”
A wide number of launches have been planned for the December quarter, a time when festivals such as Durga Puja, Dhanteras, Diwali, Christmas and wedding season is in line, retail industry executives said.
According to the Market researcher, Nielson, the fast-pacing consumer goods (FMCG) will grow 12-13% this year as it will have good economic and policy environment and also the trade conflicts which occurred in last two years due to demonetisation and GST are now being solved. “The trade dynamism triggered by demonetisation and GST rollout has almost settled down,” said executive director of Nielsen India, Sameer Shukla. “Retail offtake is buoyant with double-digit growth on the back of tailwinds — GST rate cuts, strengthening macroeconomics, and robust monsoon projections.”
Sunil Duggal, chief executive of Dabur said, “This festive season is certainly looking better than last year, and our consumer offers and pricing will be in sync with the outlook.”
The latest report of Nielsen claimed that the modern trade channels which contribute nearly 10% of the whole FMCG market, have shown rapid growth. There is also growth in the rural market as well. In June quarter this year, FMCG sells increased up to 10% when compared with last year.
Nielsen also mentioned that the more focus on the large-format stores by retailers, local and national level has supported distributed channels to grow since June 2017.
Modern trade contributes 10% to the overall FMCG retailing market compared to 9% in 2017, riding on consumer preferences for convenience, the report stated.
Foodpanda to seize 2 lakh sq ft working space in Delhi
Foodpanda, one of the biggest food-delivery startup in India is going to sign-up two lakh sq ft of co-working space in Delhi. Foodpanda opts for flexible space in order to reduce realty costs and technology, however also getting a personalized workspace which focuses on the growth of the firm.
Sundeep Singh, chief evangelist and CEO of work, said, “In the first phase, Foodpanda has taken 2,000 seats in GoWork’s 108 Udyog Vihar, Gurugram campus under the ‘built to suit’ enterprise format, with an option to expand it to 4,000 seats”.
Foodpanda is planning to expand its market share in the food delivery segment. Hence, it will utilize the space as a call centre, rider care and for chat divisions. Foodpanda also said that it has crossed the 3 lakh delivery mark last month due to its discounts and incentives schemes which the firm rolled out. Foodpanda is one of the most popular and trusted brands in the food-tech delivery platform, and having it onboard as a client offers a strong boost to the brand’s value proposition.
GoWork’s first facility is spread around 4.5 lakh square feet and space for around 7,000 people. The second unit is spread across 3.5 lakh feet and has a capacity of 5,000 seats. The firm has lately added 13 cities in its network and plans to hire about 125,000 delivery riders in the upcoming two months to offer steady delivery experience.
Foodpanda and GoWork’s contract was being settled out by Co-Founder of Dhara Realtech, Manish Beniwal. Foodpanda has not given any comment about the whole story. Various startups have already shifted to co-working spaces because of low-cost and flexibility. As per resources, around a million Sq. ft. is being captured by the co-working firms across different markets in India. With the continuous increase in the office rents, the total space covered by the co-working firms in tier-1 and tier-2 cities can reach 6-10 million sq. foot by 2020.
Zomato leads in food delivery space with 21 million monthly order run rate
India’s food delivery space is continuously growing. Day by Day, competition between the two most popular food delivery startups, Zomato and Swiggy is increasing. Both are fighting to gain more market share.
Zomato, popular restaurant search, and delivery startup claimed that it has reached 21 million monthly order run rate in India in September 2018. The firm indicates that highest deliver order volume during the month reached 7,00,000 orders each day of the week.
With this record, Zomato claims to become the market leader in the food delivery space in India.
Deepinder Goyal, who is the co-founder and CEO of Zomato said, “At the beginning of 2018, we were at 3.5 million orders a month. With 21 million orders per month, as far as we know, we are now the market leader in the food ordering space in India.”
Previously in a blog post in August 2017, Zomato mentioned that it has reached about 3 million users per month. Out of 21 million orders per month, Zomato said that 2 million orders are coming from phone every month.
Please note this, order rate is not the absolute order volume of the firm. Order run rate supports the project’s future order volume of the month and is anticipated depending on one week’s volume.
For all users who don’t know, Swiggy makes around 20 million deliveries per month. It is important to consider that Swiggy hasn’t provided any details about monthly volume since last few months.
“We were present in 15 cities in India, at the onset of this year; our food delivery business is now active in 38 cities in India. And at the pace we are going, it’s only a matter of time before we launch our food delivery business in 100 cities,” said Goyal in the blog post.
According to the absolute volumes, Zomato may be following Swiggy, its growth in the online ordering business is increasing simultaneously with the vertical becoming the largest for Zomato, now generating 65% of its overall revenues as compared to 35% it formed as of January 2018, Goyal said.
Around 86% of the orders are now fulfilled by Zomato’ own logistics with the help of 74,000 delivery agents. Earlier in January, the firm consists of only 5,000 delivery boys.
“Our annualized GMV presently stands at $1 billion compared to $210 million in January,” says Goyal in the blogpost.
Lately, Zomato has released its loyalty programme available for customers for free, similar to how swingy launched its Swiggy super on a mass scale. The firm is also thinking to launch its own digital payment solutions and mobile wallet.
Online Food Industry is facing a tough competition between Zomato, Swiggy, Foodpanda, and UberEats. Apart from providing heavy discounts to the customers, they pay between Rs 100 to Rs 120 for a single delivery.
From this, all of them are fighting hard to win the food delivery space. But, they are not much concerned as they have raised sufficient capital. Earlier, Swiggy and Zomato raised $500 million conjointly. Now, both the firms are planning to raise a large capital.
Walmart Foundation to invest Rs 180 crore to improve farmers’ livelihood
As part of its move to support sustainable livelihood for farmers in India, the Walmart Foundation Thursday declared an investment of Rs 180 crore over the upcoming five years in the country.
Judith McKenna, Walmart International CEO said, “We’re pleased to help create more opportunities for smallholder farmers in India through Walmart’s strengthened commitment to local sourcing and the Walmart Foundation’s $25 million investment to support local farmer producer organisations.”
Apart from this, Walmart India is attempting to grow its direct sourcing from farmers to 25% of produce sold in its “Cash & Carry” in the same interval of time, to provide more income to them and remove the role of the middleman. Also, it wants to speed up the market access improvements and reduce the transportation costs for producers, the firm said in one statement.
On the basis of commitment to smallholder farmers in the country, she said farmers are the pillar of the Indian economy, with over 50% of the total workforce employed in the sector.
Their main purpose is to support the efforts of the NDA government at the centre to enhance food security in the country and raise the overall economy and to fulfill the ambitious goal to double farmers’ income by 2022.
The new funds will be utilized to help farmer organization to gain knowledge of appropriate farming practices, share business best practices, add value to main agricultural commodities and provide more access to finance and markets.
The Walmart Foundation will work closely with the non-government organizations to assist farmer producer groups and build best practices and demonstration sites that are shared across India.
Their main purpose is to mainly authorize multiple farmer organizations and connect them into the nationwide farmer-support network.
As per McKenna, providing farmers with opportunities to learn and increase their access to markets have great benefits for commodities and consumers.
Farmers’ incomes can increase and they can originate new business opportunities for local entrepreneurs and help improve access to high-quality produce in their villages and beyond. All of this adds up to a stronger supply chain, stronger local businesses and better lives for smallholder farmers and their families,” Walmart CEO said.
Walmart sources 95% of the goods sold in its Best Price Cash & Carry stores in India from local companies and provides technical support and training programmes to enhance farming efficiency.
In order to expand its reach in the country, Walmart last month completed the acquisition stake of 77% in e-commerce giant Flipkart for
Walmart consists of stores in 28 Countries, providing employment to 2.3 million people and doing business with huge numbers of suppliers, which in turn employ millions of people.
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