It’s tough time for yummy chocolates, biscuits and noodles

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It seems like it is not celebrating time for Indian consumers….all are becoming cautious while spending their earnings giving a blow to our biggies in chocolate, biscuits, soft drinks and noodles  market.

The latest buzz among the biggies is that their accounting statements are showing decline in sales as inflation have started pressurizing their loyal consumers to cut down their budgets for non-essential foods.

However, the new development has put the food companies in dilemma as whether to push sales by introducing offers or increase the price to improve the profit margin (well, that could put down their profit margin further).  According to market watchers, it is time that brands either come with some innovation in the products or launch offers to pick up the sales.

The already suffering food companies under the 10-25% price hike of key inputs like wheat, sugar and milk have not increased the price of their products out of the fear that such a move could harm the sentiments of the consumers who are struggling under inflation.

Currently, what the food companies do is that they join hands with the top retailers to avail the products to the consumers at discounts and offers…..but how long they can survive with the strategy is something that is questionable.

According to the latest study released by Nielsen, the sales of essential foods like wheat, milk, tea, coffee have grown exponentially when compared to last year while, packaged food companies like Nestle and Britannia (don’t include Amul, since it’s in the hearts of Indians) has reported a decline in sales. This clearly shows the decline in spending of the consumers on chocolate products and packed foods.

However there will be some exception in the sales among packed food category. Juice….it is expected that the sales for juices will go up….again the reason is weak monsoon and growing health consciousness!!…..Consumers will be deviating a portion of their spending budget for non-essential foods to buy juice….after all it’s too hot outside yaar!!!

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