FMCG is one the biggest market of the country today and Kiwi Food is one of the leading manufacturer in the same. This organization is pioneer in producing chips, snacks and candies and Kiwi Food is a big player in Snacks manufacturers in india. Established in 2004, it has gained several milestones. This market and has both direct and indirect coverage. In India, approximately there are 1 cr, 20 lakh FMCG retailers in India. Out of this 25 % are serviced directly and 75 % have indirect coverage. Indirect coverage, the process followed is company goes to distributors and distributors goes to these retail outlets. In indirect coverage the same pathway also includes wholesalers, where distributors give the products to wholesalers and then wholesalers gives it to distributors. These retailers who purchase from wholesalers can be at times marginal small retailers located in village, where the company does not service directly. These wholesalers are also approached by the direct retailers, in case the stock ends finishes in the middle of the week/month. However, mostly the wholesalers are directly approached by the 75% indirect retailers.
These 75% outlets contribute approx. to 40%-60% of the total sales. Most of the FMCG sales gets covered from these indirect retailers only. Hence, this is huge business for any FMCG company. From this data, the main conclusion that can be drawn is that if we are able to launch ourselves in the wholesale market, with the right kinds of product we can open up a lot number of possibilities. We can increase our customer reach to more and more customers via both direct and indirect coverage.
Another most critical data worth analyzing is there are 3.3 lakh wholesalers in India selling FMCG products. Out of this proportion there are 50% pure retailers and 50 % semi retailers. These pure wholesalers sell only to the small retailers only. The remaining 50 % are semi retailers which means they deal in both wholesalers and retailers. In case of these semi retailers, further there are two segments one part is wholesaler to the retailers and second part is retailers to the final consumers. Now, the first part where the product is retailed, that part contributes to 9% of FMCG sales. The same amount of contribution towards FMCG market is made by the modern trade. Now, based on the same data one can easily identify and sell the right assortments to semi retailers.
Mostly, the wholesalers usually accommodate only the fast moving items, however, to the semi retailers and semi wholesalers the entire assortment can be sold.