Small FMCG packs a challenge; need for standard packaging: Distributors

Indiscriminate launches of small-packs of fast moving consumer goods to push consumer demand has become a big challenge for distributors who are finding no space to store such products, leading them to write to the Ministry of Public Distribution that there should be only four pack sizes. The new smaller packs are “leading to retailer reluctance, placing extra burden on retailers as they have to keep on adding new packs, leading to inventory management challenges, and impacting distribution efficiency,” said Dhairyashil Patil, national president of the All India Consumer Products Distributors Federation (AICPDF), which represents more than four lakh distributors and stockists. Nestle, HUL, Britannia, Dabur and ITC are among the companies that have been launching a lot more low-priced packs across noodles, toothpaste, soaps and biscuits, to cater to inflation-hit consumers and fight off increased competition from regional brands.

Retailers are showing reluctance to keep an added number of stock keeping units (SKUs) due to increased complexity and potential confusion among consumers. In addition, the difference in per-gram pricing among the numerous packs within the same price bracket has become a significant issue, as it often leads to consumer confusion, the distributors’ entity said.

“Launching different packs for different markets is in response to consumer demand. We have to give consumers what they wants, whether it’s kiranas, modern trade or quick commerce,” said the chief of a large FMCG company, requesting not to be identified.


The distributors have written to Ministry of Public Distribution, proposing standardising packaging into four categories - entry, small, medium and large.

“By categorising products into these standardised packaging sizes, it is expected to simplify inventory management, reduce complexity for retailers, and eliminate consumer confusion arising from multiple SKUs within the same price range under a single brand. This move seeks to strike a balance between market expansion and ensuring the smooth operation of the distribution network. AICPDF encourages companies to support these efforts and work collectively towards a more organized and consumer-friendly market environment,” the federation said.