Sales of fast-moving consumer goods flat line in first three quarters
Although sales of fast-moving consumer goods declined in the first six months of 2020, a recovery is taking shape.
Sales of fast-moving consumer goods (FMCG) in China remained flat in the first nine months of 2020 after three straight years of annual growth exceeding 5 percent, although early signs of a recovery have begun to take shape in recent months.
Average prices decreased by 2.1 percent — the first decline in five years — a major contributing factor to the market's sluggish performance, as shoppers seek mass-market products and take advantage of discounts wherever possible.
"Due to the pandemic, there's been a massive change in consumer sentiment, leading to more caution and bargain hunting,” said Bruno Lannes, a partner in Bain’s China Consumer Products practice and co-author of the latest China Shopper Report from Bain & Company and Kantar Worldpanel.
Accordingly, retailers have been forced to offer deep discounts after suffering significant losses during the first quarter's lockdown period.
In terms of quarterly figures, sales are trending higher with an increase of 3.5 percent in the second quarter and 4.1 percent in the third quarter — on the heels of a 6.7 percent decrease in the first quarter.
The study, which excludes fresh food and cooked meals, determined sales volume growth remained consistent with last year's 2 percent rate.
Online sales contributed 26.7 percent to all FMCG sales in the first three quarters of 2020 — up from 21.9 percent last year — as more shoppers turned to delivery service for daily necessities.
Packaged food and beverages also sustained price declines, but the volume of purchases surged, with packaged foods growing 7.2 percent as a result of people stockpiling staples such as instant noodles and frozen food.
Home-care sales grew by a healthy 9 percent, while carbonated soft drinks grew even faster with an increase of 16 percent.
