The fast-moving consumer goods

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    The fast-moving consumer goods (FMCG), also known as CPG, is expected to nearly double in value over the next ten years, from around $ 8,000 in 2014 to $ 14,000 billion in 2025.

    That is equivalent to forecasting there will be about 81 corporations like Kellogg in the next decade. The fiercest competition, especially in the BRICS such as Brazil, Russia, India, China. How do companies in this industry manage?
    Acewtrading.com
    Three unbelievable truths

    McKinsey's experts studied the markets of more than 2,600 of the world's largest cities and turned out to be the wrong thing to do.

    First of all, the US and Western European markets are not all out of growth. Most CPGs believe that this is just a scrambling market for distribution to maintain market share. But not so. Not just growth, but markets in many cities in the US and Western Europe are growing fast not inferior to emerging markets. Ignoring these markets, the CPG companies missed out on many opportunities at home. According to research, commodities such as anti-aging cream, beverages, mineral water, ... will double the growth of current expenditure.

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    Secondly, new brands that do not have a solid financial basis are wrong to assume that it is too late to enter the Chinese or Indian market due to harsh competition. In fact, if they choose the major cities to be present, their ability to dominate the market will be extended. For those industries with low minimum requirements, markets that need to join in these markets (in some key cities) may also generate revenue equivalent to the coverage. Nationwide in other emerging markets - even higher. For example, the fruit juice industry in Shanghai will grow threefold and the market size is greater than that of Malaysia.

    In addition, many cities in China and India are modernizing their distribution and retail infrastructure, making access to these markets more complex in rural areas.

    Thirdly, the truth is quite contrary to what they have long believed, that consumers in emerging markets will not buy high-end products. In fact, in large cities in developing countries, the per capita income is as high as or even higher than that of similar cities in North America or Europe. The structure of local needs in these cities is similar and is increasingly similar to the demand in the cities of developed countries. For example, products such as high-end cosmetics, baby food, pet food, etc. Companies that can meet these consumer needs will soon be positioned as consumers. Market leadership, even creating momentum for other needs. A good example of this is that P & G entered China with a baby diaper when the market was only used to cloth diapers, becoming immediately the first choice brand and quickly becoming the dominant brand. Navigating this segment in China.
    See more; ace world trading

    Building strategies for micro markets

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    As a result of the report, researchers have suggested a different approach to developing country markets (especially the BRICS) - to gain market share equivalent to or larger than the national markets. other. One example is the study of middle-sized cities with a population of 20,000 to 50,000 people in Brazil, but with an average annual growth rate of about 7.5% and bring about the same level of expenditure. about half of the total Brazilian population. As a sunscreen or baking industry, it is possible to achieve twice the dental growth rate or up to 50%, respectively. Meanwhile, in India, growth markets will come from urban areas - concentrated in the 70 most populous cities - accounting for about one-seventh of the country's population, contributing up to over 1 / 4 for the total value of the beverage industry from 2014-2025.

    In order to penetrate these markets, experts suggest the following issues that the CPG Group offers:

    Hot spot analysis: Which cities are the top 100 cities that we should build presence to reach growth ambitions?
    Select the industry: Which major and secondary industries have the greatest growth potential in those cities?
    Market monitoring: What specific market conditions do you expect?
    Resource Allocation: Which geographical areas should be allocated more resources to ensure our future growth?

    For cities in developed countries where markets are more crowded and have lower growth potential, the following questions are important:

    Preliminary data analysis: Which cities or micro markets have the best growth opportunities for our products?
    Check for presence "How strong are we when we are present in areas where growth has occurred?
    Market positioning: In high growth areas, our market share is below par
     
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    The fast-moving consumer goods

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