FMCG and FMCD may seem difficult to differentiate, at first. If you’ve worked in the retail industry before, then you’ll likely be familiar with terms like FMCG or FMCD. To the average person, however, these terms may sound a little confusing. In this article IOEC outlines the differences between FMCG and FMCD.
FMCG stands for fast moving consumer goods. FMCD, on the other hand, stands for fast moving consumer durables. What's the difference between the two?
FMCGs are goods that are purchased frequently and have a short shelf life. FMCG products are usually consumed almost immediately by the consumer and, therefore, need to be replenished from time to time. FMCGs are usually sold in large quantities. FMCGS generally have a low profit margin. FMCGS, however, are often noted for their high sales volume.
Some examples of FMCGs include:
FMCD products, on the other hand, have a much longer life expectancy than FMCG products. FMCD products do not exhaust or expire in one use and can be used repeatedly. The FMCD product sales volume is also considerably lower than FMCG products.
Some examples of FMCDs include:
There are some challenges and potential risks when it comes to the FMCG industry. As mentioned previously, these goods perish quickly, which on its own is a major challenge for retailers, especially when a product is not moving fast enough. Furthermore, it is incredibly difficult to keep up with the competition and ever changing FMCG consumer demand.
FMCG Packaging is also a major challenge. The primary package is not only critical for protecting the product and extending the shelf life, but it also provides critical information to entice consumers to buy the product.
Some other challenges also include pricing, branding and logistics.
The FMCG industry is extremely large, and competitive. Some of the world's largest companies operate within the FMCG industry, including powerhouse companies like Nestlé, Coca-Cola, Unilever and PepsiCo. That is why it is critical for companies to focus on their marketing efforts to create awareness for their brand and entice consumers to buy their products.
Consumer trends are shifting drastically. This is largely as a result of the COVID-19 pandemic. The COVID-19 pandemic has led more consumers to be more aware of their overall health and wellness. There’s a much larger demand now for natural and organic products than there was pre-pandemic. Furthermore, consumers are also seeking to support purpose driven brands who are responsive to environmental concerns. It’s becoming more apparent that consumers are favouring brands that align with their personal goals. Thus, eco-friendly, cruelty-free and vegan products are becoming increasingly popular.
The COVID-19 pandemic also fast tracked the retail industry's shift into the e-commerce world. Consumers were introduced, and further attracted to, online grocery shopping from the comfort of their homes and now they never want to look back. Online shopping continues to thrive and grow, globally, as the COVID-19 pandemic has begun to wane.
At IOEC, we supply fast moving consumer goods, commodities and building materials to over 50 countries around the world. We are proud to represent over 400 of South Africa’s finest FMCG food and beverage brands in many international markets. Contact us today to see how we can help grow and distribute your FMCG product.
