Revitalizing Retail: FMCG’s New Growth Strategies for Kirana Stores in 2023

The FMCG (Fast-Moving Consumer Goods) sector in India and globally has been adapting to changes and showing growth trends, especially in 2023. Here’s a detailed overview incorporating data and insights from various sources:

Global FMCG Industry Growth

  • Global Growth: In 2022, the global FMCG industry posted a nominal growth of 6.3%. Pet care and snacking emerged as the fastest-growing segments, with frozen, dairy, and paper products also outpacing overall FMCG growth​​.
  • Growth Strategies: FMCG manufacturers and retailers can drive growth amidst cautious consumer sentiments by harnessing retail measurement data, analyzing consumer behavior, optimizing supply chain performance, and implementing targeted marketing and pricing strategies​​.

FMCG Industry in India: 2023 Trends and Data

  • Overall Trends: The first quarter of 2023 saw positive consumption growth in both rural markets and non-food categories for the first time in six quarters, driven by declining overall inflation rates​​.
  • Value Growth: India’s FMCG industry observed a double-digit value growth of 10.2% in Q1 2023, a 2.6% increase from the previous quarter. This growth is attributed to a revival in rural markets and traditional trade channels​​.
  • Regional Growth: Rural India’s consumption growth revival is being led by the southern (2.8%) and eastern (3%) zones, while urban India continues to drive value growth with a 5.3% increase in Q1 2023 across food and non-food categories​​.
  • Trade Channel Growth: Organized retail in modern trade channels saw high double-digit growth (14.6%), while traditional trade experienced a turnaround (1.9%), primarily driven by grocers​​.
  • Food and Non-Food Trends: Food witnessed a high consumption growth of 4.3% in Q1 2023. Staples led growth in food, while home care categories led non-food consumption growth after six consecutive quarters of decline​​.
  • Manufacturer’s Growth: Small manufacturers drove value and consumption growth within food (7.2% volume growth for small vs. 3.2% for large manufacturers). In non-food, large manufacturers drove growth (0.6% volume growth for large vs. -1.8% for small manufacturers)​​.
  • 2023 Forecast: Despite global uncertainties, India’s FMCG market is forecasted to grow by 7%-9% for the full year 2023, with potential headwinds like inflationary pressure on consumers and a high unemployment rate, and tailwinds from government initiatives and a forecasted 6.4% GDP growth​​.

FMCG Companies’ Strategies for Kiranas Amid Retail Slowdown

  • Reinvestment in Kiranas: FMCG companies are reinvesting in kirana stores, which continue to be crucial for FMCG sales, accounting for a significant portion of the sector’s revenue in India​​.
  • Adoption of Technology: Kirana stores are increasingly adopting digital technology to improve operations and connectivity with consumers. This digital shift is part of FMCG companies’ strategies to remain competitive and drive sustainable growth​​.
  • Balanced Growth Approach: Companies are focusing on a balanced growth strategy, addressing both traditional and new channels. Marico’s managing director, Saugata Gupta, emphasized the need for reinvestment in core business and the importance of ecommerce and new industry channels​​.


The FMCG sector, both globally and in India, is showing resilience and growth amid changing market dynamics. The focus on reinvesting in traditional trade channels, particularly kirana stores, coupled with leveraging digital technology and sustainable practices, positions the sector for continued growth and adaptability in the face of evolving consumer behaviors and economic conditions.



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