Due to rising cost, FMCG companies took a big decision, reduced the packet size by 10%

The cost of FMCG companies has increased by 20 to 30 percent due to the cost of raw materials. Companies have tried to pass on the cost burden by increasing small packets and MRP.

Size of packets reduced by 10 percent.

War in Russia and Ukraine (Russia Ukraine WarThe effect of ) is now visible in the country. Prices of petrol-diesel, CNG, LPG, milk, everyday items have started increasing. Crude oil from Ukraine crisis (Crude Oil) effect of rising prices FMCG companies ,FMCG Companies) is also there. The rise in crude prices has increased the cost burden on FMCG companies. Due to rising cost, FMCG companies have changed their strategy. Companies have reduced the package sizes of many products. This will help companies to increase sales.

The country’s largest FMCG company Hindustan Unilever (HUL) has been increasing the prices continuously for the last six months. The company increased the price of surf soap by 2 to 17 percent. In the last six months, the prices of products have increased by 25 to 30 percent. Maggi made in 2 minutes became more expensive by 2 rupees. The new price increased from Rs.12 to Rs.14. Parle Products is expecting a 10-15 per cent hike in prices.

Consumers have reduced their spending due to inflationary pressures. They are buying smaller packs. That’s why companies have changed their strategy and have reduced the packet size of the products.

Commodity prices rise

Due to the Russo-Ukraine war, the prices of all three commodities, crude oil, palm oil and wheat, increased wildly. These three commodities are the biggest raw material for FMCG companies. Crude prices increased by 124 percent in the last one year. Packaging accounts for about 10 to 15 percent of the cost of FMCG companies. Raw material for the packaging industry is expensive on the lines of crude oil. That is, the faster the crude oil, the more expensive the packaging material. Apart from this, after the cost of bulk diesel and coal, the cost of energy for companies has also increased.

Packets size reduced by 10%

The cost of FMCG companies has increased by 20 to 30 percent due to the cost of raw materials. Companies have tried to pass on the cost burden by increasing small packets and MRP. Packets of price sensitive products were reduced and MRP increased.

The packets of these companies became smaller

The companies that have reduced the packet sizes of their products include Parle, Britannia, Haldiram, HUL. Parle’s Biscuits, Britannia’s Milk Rusk packet is shortened. On the other hand, Haldiram’s Namkeen and HUL’s Lifebuoy) soap has also become smaller.

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