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Tuesday, October 20, 2020

Consumers’ focus shifts to packaged & high-value food items in lockdown 2.0

Future Group, Metro and Lots Wholesale saw a spike in demand for packaged food products like biscuits and noodles, resulting in an increase in the average purchase value per customer. There was a considerable shift in the buying patterns of the consumers in the second phase of the lockdown from basic necessities to items like snacks, packaged meat, processed food and frozen desserts, confirmed retailers.

Arvind Mediratta, MD & CEO of Metro Cash & Carry India said that the second phase witnessed a growing demand for processed food, packaged meat and frozen desserts. People are working from home. Hence, snack items, biscuits and hot beverages are also in demand amongst customers. People also sought products such as kitchen appliances, electrical goods, stationery and storage containers at Metro.

Kamaldeep Singh, President Food & FMCG Future Group also agreed that in the first phase people were buying basic necessary items such as atta, pulses and sugar, but in the second phase they focussed more on food items like biscuits, noodles and pasta.

Panic buying stopped once people saw that restrictions are easing and they could get their everyday essentials, Mediratta added. 

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Metro is witnessing enquiries from customers for IT products such as computers, mouse, keyboard, chargers and other accessories as most people are working from home.

According to Singh, the definition of basic necessity has changed in a couple of weeks from basic foods to snacking. People are not willing to travel long distances, hence footfall of large format stores is down but sales of convenience stores like EasyDay have picked up considerably.

Tanit Chearavanont, MD, Lots Wholesale Solutions also said that the second phase is majorly coming from both the “food and non-food FMCG categories” as compared to commodities which had seen a spike in the initial phase of lockdown. Also, with the summer season kicking in there is a growing demand in insecticides as well.

Lalit Agarwal, Chairman & MD, V-Mart Retail said that even though they are not operating many stores but have observed a shift in the consumer buying pattern in the second phase of lockdown. Earlier, they had noticed panic buying by the customer, purchasing whatever they can do but now people are assured about availability. That trust has come and now people are purchasing as per their requirement.

Several retailers have seen an increase in sales of their private labels, which filled the gaps as supply lines from other manufacturers were disrupted. Consumers in the lockdown period are brand agnostics. They are not very brand conscious, they simply want products, said Singh.

Mediratta too agreed that due to the disruption in the supply chain, there were several FMCG companies that were not able to deliver their goods as their production was interrupted, leading to a shortage of branded goods such as instant noodles. But, customers were not bothered even if favorite brands were not available and were happy to transition to a private label brand. This gave a lot of boost to private labels whose stocks were available locally and so their supply remained steady without hindrances.

SourceET Retail
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