The FMCG industry is the fourth-largest industry in the Indian economy. The FMCG market in India is expected to become USD 220 billion by 2025 from USD 110 billion in 2020. The FMCG market in India is primarily driven by household and personal care which account for 50% of the revenue of the industry. Rising income levels, changing lifestyles, growing awareness, fashion trends, easier access to the products are some of the factors contributing to the growth of the market.

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Growing Urban Markets

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The urban areas contribute to over 60% of the FMCG market in India. Urban India has largely contributed to the growth of the FMCG market in the country over the past decade. Particularly in the urban areas, there has been a shift in the purchase pattern of people over the past few years towards premium products from essential goods. This in turn led to the rapid growth of FMCG sales in urban India. With more and more people moving to cities and towns from rural areas, the demand for FMCG products is only going to increase in the urban areas in the future. 

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Untapped Rural Markets

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While urban areas account for the major portion of the FMCG market, the market in rural areas is growing at a rapid pace. The growth rate of the FMCG market in rural areas is more than that of the growth rate of urban areas in India. Rural India with more than 65% of the population contributes to around 45% of the FMCG market. This signifies the relatively untapped market in the rural areas of India.