FMCG Pest Analysis

Decent Essays
PEST Analysis
FMCG is considered to be fastest growing segment in India. The introduction of sachet packages has increased penetration of products in the market has lower income people started using the products and middle income people started growing rapidly in India. The people want to up trade and improve there standard of living.
Political: India was initially a closed economy there was numerous restriction and laws imposed on foreign companies in order to carry out business there, the reason because British also came as traders and then occupied whole India, making them slaves for more than a century. Also there was also an opposition to FDIs, they shut down the wal Mart, as the time pass the government realized that they have slowed
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All FMCG products are more hygienic and healthy than lose products offered on streets and this definitely means low mortality ratio in future as more and more people will start consuming these packaged goods. Apart from this, it is the 4th biggest sector in India which contributes about 2.5% to GDP and creates employment for thousands of young graduates each year. This sector is dominated by MNCs and these companies invest millions of dollars each year to improve the living conditions of poor in India. In developing countries like India not all poverty eradication, education and other development projects can be taken by government, so any initiative by these firms is a huge…show more content…
• Favourable government policy: the Indian government has passed the policies aimed to attaining international competitiveness by lifting the quantitative restrictions, reducing excise duties, export units can be set up by a government approval and use of foreign brand names.
• Foreign Direct Investment: Automatic investment is approved up to 100% foreign equity/100%for NRI and overseas the corporate bodies investments is allowed for most of the food processing sector expected malted food and beverages and reserved for small scale industries.

 Weakness:
• There is lower scope for investing in technology and achieving economies of scale, especially in small scale and low exports.
• Me to products which illegally mimic the labels of established brands. These products narrow the scope of FMCG products in rural and semi- urban markets.

 Opportunities:
• There is untapped market, changing life style of the people and rising in purchasing power of consumers.
• There is large domestic market with the population of age 25 and high consumer spending on
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