Key Points
FMCG companies that had made retail packs of daily essentials lighter without changing their prices to offset steep inflation last year have started putting grammage back into the packs amid cooling inflation of key ingredients and reduction in packaging costs...
Industry executives said the gains from declining input costs are being passed on to consumers by directly putting back grammage in packs, specially for categories in popular price points of 10, 20 and 25, where frequent price changes are inconvenient...
"We have put back grammage on some of our snacking brand packs as inflation cooled off for many of the commodities we use," said Ahmed ElSheikh, president of foods and beverages major PepsiCo that makes Kurkure and Lays snacks..
So, the optimum way to pass on benefits is by increasing weight of packs and putting back grammage," said Mayank Shah, senior category head at biscuits maker Parle Products that competes aggressively with Britannia and ITC. ..
Abneesh Roy, executive director at Nuvama Institutional Equities, said besides lower cost of key ingredients such as edible oils, companies are also benefitting from a reduction in fuel and packaging costs..
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