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AICPDF raises alarm: FMCG firms using quick commerce for near-expiry products

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Ashutosh Dubey
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FMCG, D2C, Inflation, Brands, Food & Beverages
GCPL, Dabur, Marico: FMCG Majors face margin pressure as palm oil, advertising and input costs rise

The All India Consumer Products Distributors Federation (AICPDF) is worried that FMCG companies are using quick commerce and e-commerce platforms to sell products that are near their expiry dates or aren’t selling well.

AICPDF alleges FMCG firms dumping low-demand products

According to The Hindu Business Line, the group has shared its worries with the Ministry of Consumer Affairs, highlighting three main issues with quick commerce: dumping products on platforms, informing consumers, and negative impacts on retailers.

Continue Exploring: Bata registers 53% profit growth, reaches INR 52 cr in Q2 FY25

“Quick commerce and e-commerce platforms have turned into convenient channels for FMCG companies to offload products nearing expiry or with low consumer demand. 

Consumers are lured by attractive discounts and may unknowingly purchase near-expiry products or non-movable stocks that can pose health risks, especially with food and consumable goods. The influx of discounted, near-expiry products on e-commerce and quick commerce platforms creates an uneven playing field, severely impacting traditional retailers. Small and medium-sized retailers cannot compete with the deep price cuts, which affects their financial stability and threatens their survival,” the organisation stated.

FSSAI raid at Zomato warehouse raises concerns

The consumer group has asked the Consumer Affairs Ministry to create regulations, support traditional retailers, and make quick commerce more transparent.

Continue Exploring: Delhi consumes 3.9 Cr bottles of liquor worth INR 4.48 billion during Diwali

“Implement strict regulations to monitor and control the sale of near-expiry and non-movable stocks on quick commerce and e-commerce platforms, ensuring that consumers are adequately informed. Second, enforce mandatory and clear labelling for products that are close to expiration and develop policies that prevent unfair competitive practices and support traditional retailers, protecting them from the repercussions of large-scale dumping by FMCG companies,” added AICPDF.

This comes amid the Food Safety and Standards Authority of India (FSSAI) team finding 90 packets of button mushrooms with wrong packaging dates in a raid at Zomato‘s Hyperpure warehouse in Hyderabad recently.

Previously in this month, the Commissioner of Food Safety, Telangana, posted on X that its task force team inspected Zomato Hyperpure in Hyderabad on October 29. They found 18 kg of button mushrooms with a packing date of October 30, 2024, which violated food safety rules.

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Bata registers 53% profit growth, reaches INR 52 cr in Q2 FY25

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Ashutosh Dubey
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Bata Outlet
Bata registers 53% profit growth, reaches INR 52 Cr in Q2 FY25

Bata India Ltd. announced on Monday, November 4, a 53% increase in consolidated net profit, reaching INR 51.97 crore for the second quarter ending September 2024. This growth was due to better operations and selling premium products. 

Bata’s revenue from operation sees 2.2% jump

According to India Retailing, Bata India had a net profit of INR 33.99 crore for July-September FY24, as stated in a regulatory filing. Revenue from operations increased by 2.2% to INR 837.14 crore during the quarter. “The EBITDA profit stability showcased the company’s resilience in managing operational efficiencies,” said the company in its earnings statement.

Continue Exploring: Delhi consumes 3.9 Cr bottles of liquor worth INR 4.48 billion during Diwali

Notably, total expenses for the September quarter were INR 784.55 crore, a 5% increase from last year. Total income, including other income, rose by 2.36% to INR 854.32 crore.

“The results for the quarter reflect continued momentum in the transformation journey, driven by strategic investments in product innovation, elevated customer experience, technology integration and brand premiumisation, positioning Bata strongly for future growth,” it said.

Meanwhile, MD and CEO Gunjan Shah released a statement regarding the result, saying, ”Despite continuing market headwinds and subdued consumption, we saw some recovery in our growth trajectory through the quarter backed by focused execution of strategic initiatives.”

Bata to operate 1955 stores by end of quarter

“We are seeing strong validation of our premiumisation strategy across channels, with premium products showing robust growth and increased contribution to our revenue mix. Our Brand stories connected well with the targeted audience,” he added.

Continue Exploring: Zomato CEO Deepinder Goyal clarifies vendor’s mistake on ‘future packing date’

Additionally, Bata India continued to expand its retail network, reaching 1,955 stores nationwide by the end of the quarter, including both COCO and franchise stores. It opened 4 Exclusive Brand Outlets (EBOs) for Power, 136 EBOs for Hush Puppies, and 14 kiosks for Floatz.

“Our expansion through franchise stores in Tier 3-5 markets, combined with our robust digital presence, is helping us tap into new growth opportunities with strengthened omni-channel approach. Our conscious efforts on Franchise model expansion are showing good results,” stated Shah.

He said that Bata will keep balancing between handling short-term challenges and investing in long-term growth opportunities.

“We are optimistic about consumption recovery in the coming quarters, backed by festive season momentum and our strong market positioning,” he further added.

On Monday, Bata India Ltd.’s shares closed at INR 1,336.90 each on the BSE, a drop of 1.47%.

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Delhi consumes 3.9 Cr bottles of liquor worth INR 4.48 billion during Diwali

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Ashutosh Dubey
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Liquor shop
Delhi consumes 3.9 Cr bottles of liquor worth INR 4.48 billion during Diwali

Diwali celebrations in Delhi have led to a huge increase in liquor sales. In the two weeks before Diwali, 3.9 crore liquor bottles were sold, bringing in INR 448 crore in revenue. These sales happened through 680 government-run shops.

Liquor sales figures exclude 900 hotels, clubs, and restaurants

According to Economic Times, this year’s liquor sales have significantly increased compared to the past two years. In 2022, 1.9 crore bottles were sold for INR 324 crore, and in 2023, sales went up to 2.7 crore bottles worth INR 433 crore.

Continue Exploring: Zomato CEO Deepinder Goyal clarifies vendor’s mistake on ‘future packing date’

These figures don’t include liquor sold at over 900 hotels, clubs, and restaurants, which means the total market impact is even bigger. Experts say that liquor sales usually slow down for about three weeks before Dussehra because many people avoid alcohol for religious reasons, ET reported.

Delhi Sells 35 Lakh Liquor Bottles on October 29

However, demand picks up a lot after Dussehra and reaches its peak just before Diwali. On October 29, sales hit around 35 lakh bottles, the highest of the season. It dropped slightly to about 34 lakh on October 30, the day before Diwali.

Continue Exploring: Magicpin cuts platform fee to INR 5 as Zomato, Swiggy raise charges

Further, the sales include different types of alcohol like whisky, rum, vodka, gin, beer, and wine. Officials say that people buy liquor not just for themselves, but also for gifts or to stock up for the festive season. This increase in sales has helped the excise department, which had problems with liquor shortages due to issues with the Excise Supply Chain Management System (ESCIMS) portal. A new portal launched in October by the National Informatics Centre has made it easier for shops, hotels, and bars to restock.

Meanwhile, due to the spike in liquor sales during the festive season, the government’s revenue from excise duty and value-added tax has increased compared to last year.

Notably, from April 1 to October 31 this fiscal year, the government collected INR 3,047 crore from liquor excise duties, nearly 7% more than the INR 2,849 crore collected in the same period last year. The Delhi government expects to earn INR 6,400 crore in excise revenue for the 2024-25 budget.

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Zomato CEO Deepinder Goyal clarifies vendor’s mistake on ‘future packing date’

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Ashutosh Dubey
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Zomato CEO Deepinder Goyal, Button Mushroom
Zomato CEO Deepinder Goyal clarifies vendor’s mistake on ‘future packing date’

A few days after reports claimed that a food safety raid at Zomato‘s Hyperpure warehouse in Hyderabad found 90 packets of button mushrooms with a “future packing date,” the company’s co-founder and CEO, Deepinder Goyal, explained it was a mistake by the vendor.

FSSAI discovers 90 mushroom packets with incorrect dates

Deepinder took to X to acknowledge that the Food Safety and Standards Authority of India (FSSAI) team found 90 packets of button mushrooms with wrong packaging dates. However, he emphasised that Zomato’s warehouse team had already flagged and rejected these items during quality control checks.

Continue Exploring: Magicpin cuts platform fee to INR 5 as Zomato, Swiggy raise charges

Goyal explained that the wrong packing date was a typing error by the vendor. He added that the vendor has been removed from Zomato’s database. Goyal emphasised Zomato’s commitment to food safety, saying, “We are committed to upholding industry food safety standards and are focused on not compromising on product quality at any stage of the supply chain. The recent food safety inspection at our Hyderabad warehouse resulted in the Hyperpure warehouse achieving an A+ rating, the highest benchmark in their ranking.”

Housflies, handlers without hygiene gear in Zomato’s Hyperpure

Previously in this month, the Commissioner of Food Safety, Telangana, posted on X that its task force team inspected Zomato Hyperpure in Hyderabad on October 29. They found 18 kg of button mushrooms with a packing date of October 30, 2024, which violated food safety rules.

Continue Exploring: Amazon partners with HPCL to promote Low Carbon Fuels

Additionally, the post noted that house flies were found on the premises because there were no insect-proof screens, and some food handlers were not wearing proper hygiene gear, like hair caps and aprons. It’s important to mention that the warehouse is a Food Business Operator (FBO) and supplies food to hotels and restaurants.

Even though Zomato has valid licences and medical certificates for food handlers, these reports raise concerns about their food safety standards. This incident comes after a report in June about safety violations at another Zomato-owned facility, Blinkit, in Devar Yamjal, Medchal Malkajgiri district.

Furthermore, the Telangana food safety department said they seized edible items worth INR 82,000 from the premises that either didn’t meet food safety standards or had expired licence. These hygiene issues come amid increased focus on food safety in India, as complaints tend to rise during festive seasons like Diwali.

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Magicpin cuts platform fee to INR 5 as Zomato, Swiggy raise charges

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Ashutosh Dubey
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Magicpin logo ONDC
Magicpin cuts platform fee to INR 5 as Zomato, Swiggy raise charges

Magicpin, a hyperlocal delivery service, has cut its platform fee to INR 5 per delivery, making it half the cost of what Zomato and Swiggy charge. This change comes as major players in the food tech sector are increasing their platform fees.

Magicpin announces fee reduction for the year

Anshoo Sharma, Magicpin co-founder and CEO took to X and wrote, “This Diwali, we went against the current trend, and took some hard platform pricing decisions. Result: More than half a million festive food orders, love and support received during the long festive weekend! This is 2X of what we did last year.”

Continue Exploring: Dabur India to acquire major stake in Sesa Care for INR 12.59 Cr 

He added that this change aims to support delivery partners while keeping customers satisfied. Magicpin has cut its platform fees to INR 5 for the rest of the year, which is half of what competitors Zomato and Swiggy charge. This comes after both competitors raised their fees to INR 10 per order last month due to the festive season.

Meanwhile, the delivery platform’s price cut is part of its strategy to strengthen its role in the food delivery market. The company recently launched Velocity, a logistics service that works with partners like Shadowfax, Dunzo, Rapido, Porter, Ola, and Zypp. Through Velocity, Magicpin serves big brands like KFC, Burger King, and Rebel Foods.

Magicpin handles 90% of orders on ONDC

Furthermore, Magicpin announced it will keep the INR 5 platform fee for the rest of 2024, down from INR 7. This decision follows magicpin’s growth on open network for digital commerce (ONDC), where it handles 90% of food orders from major apps like Paytm, Tata Neu, and Ola. The company recently said it processes 150,000 daily orders for food and logistics, a 1500 times increase in the last 16 months.

Continue Exploring: Dabur India suffers 17.65% profit drop amidst high inflation, weak urban demand

Established by Sharma and Brij Bhushan in 2015, Magicpin started as a retail discovery and rewards platform before moving into food delivery. Bhushan recently joined Prime Venture Partners as a venture partner, while Sharma continues to lead the company’s growth plans. Magicpin plans to invest INR 100 crore to enhance its presence on ONDC and aims to bring 100,000 new restaurants and cloud kitchens on board.

Notably, Magicpin now works with 70,000 restaurants, up from 22,000 since joining ONDC in March 2023. It has gained over 10% of the food delivery market in important areas like Delhi NCR and Bengaluru.

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Babyshop launches first store at Gaur City Mall

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Ashutosh Dubey
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Babyshop has opened its first store in India at Gaur City Mall, offering a wide range of products for babies, toddlers, and children to Indian shoppers.

Inauguration features owners of Gaur

The grand opening featured Sarah Gaur, owner of Gaurs Group; Ruban Shanmugarajah, CEO of Babyshop; Dheeraj Chawla, India CEO for Babyshop; and Justin Masih, VP of Leasing for Gaurs Group. The event was lively as the leaders emphasised the brand’s commitment to high-quality products for the Indian market, making Gaur City Mall even more family-friendly.

Continue Exploring: Dabur India to acquire major stake in Sesa Care for INR 12.59 Cr

According to Indian Retailing, Ruban Shanmugarajah, CEO of Babyshop, released a statement, saying, “Babyshop’s entry into India is truly significant as we aim to bring world-class products to support families at every stage of parenthood. With our carefully curated range, we’re here to make parenting more joyful, with essentials for every little moment that matters.”

Babyshop currently runs in 14 countries

Additionally, Families visiting the store will find Babyshop’s blend of quality, comfort, and thoughtful design, made for Indian parents and kids. The Gaur City Mall store will be a parenting hub, offering easy access to products for lasting family memories and children’s comfort and well-being. “Visit Babyshop at Gaur City Mall today to explore everything you need for your parenting journey,” the brand stated.

Continue Exploring: Dabur India suffers 17.65% profit drop amidst high inflation, weak urban demand

Notably, Babyshop, with over 50 years of experience and presence in 14 countries, is known for its quality and trust. They make parenting easier and support parents every step of the way. With their entry into India, families now have a one-stop shop for children’s products, including clothing, nursery essentials, feeding supplies, and educational toys.

With Babyshop’s entry, Gaur City Mall strengthens its position as a top spot for modern families. The new Babyshop store provides a complete shopping experience, letting parents find premium products at their local mall. Babyshop enters the Indian market at a time of rising demand for high-quality children’s products, and its experience makes it well-suited to meet this need.

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Dabur India to acquire major stake in Sesa Care for INR 12.59 Cr

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Ashutosh Dubey
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Dabur India announced on Wednesday, October 29 that it will buy a majority stake in Sesa Care Private Limited for INR 12.59 crore. This acquisition of the ayurvedic hair care company is expected to boost Dabur’s presence in the hair care market and complement its existing products, the company stated in an exchange filing.

Dabur to buy 51% stake of Sesa

According to Economic Times, as part of this deal, Dabur will acquire 51% of Sesa’s shares from True North (a private equity fund) for Rs 12.59 crore at face value. The estimated value is between Rs 315 crore and Rs 325 crore, which includes a debt of Rs 299 crore, backed by Dabur’s corporate guarantee, the company said in a press release. The acquisition is expected to be completed in 15-18 months, subject to terms and conditions.

Continue Exploring: Dabur India suffers 17.65% profit drop amidst high inflation, weak urban demand

Meanwhile, Sesa, a well-known brand in Ayurvedic hair care, had a turnover of Rs 133.3 crore in the fiscal year ending 2024. It operates in India and Bangladesh. After the merger, Sesa Bangladesh will be fully owned by Dabur, the company stated.

Merger with Sesa to introduce brand in Ayurveda- Chairman, Dabur

“Dabur is a market leader in the hair oil category. The merger with Sesa will introduce a premium brand that has robust credentials in Ayurveda, complementing our existing portfolio and enhancing our presence in the hair care market. We look forward to the exciting opportunities this deal presents,” stated Mohit Burman, Chairman, Dabur India Limited to ET.

Continue Exploring: Ninjacart’s revenue soars by 74%, hits INR 2000 Cr

Furthermore, Abhinav Dhat, Dabur India’s Executive Director and Group Head of Corporate Strategy added, “Sesa allows us to fill a strategic gap, and we will actively seek additional targets in both traditional and modern sectors.”

Additionally, the share exchange for equity shares and the remaining CRPS in Sesa will be set during the merger filing, based on valuation reports.

“With this proposed merger, our goal is to create a stronger, more resilient business that will provide even greater opportunities for growth in the future,” commented Sandeep Rai, CEO of Sesa Care Private Limited.

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Dabur India suffers 17.65% profit drop amidst high inflation, weak urban demand

By
Ashutosh Dubey
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FMCG giant Dabur India Ltd reported a 17.65% drop in its net profit to INR 417.52 crore for the September 2024 quarter due to high food inflation and reduced urban demand.

Dabur India revenue drops by 5.46% to INR 3, 028 Cr 

According to India Retailing, Dabur India recorded a net profit of INR 507.04 crore in the same quarter last year. This quarter, their revenue from operations dropped by 5.46%, down to INR 3,028.59 crore from INR 3,203.84 crore in the same period the previous year.

Meanwhile, Dabur India’s total expenses dropped by 1.31% to INR 2,634.40 crore in the September quarter. “Despite a challenging demand environment marked by high food inflation and a resultant squeeze in urban demand, Dabur continued to drive consumer engagement across its key brands to end the second quarter of 2024-25 with a consolidated revenue of Rs 3,029 crore,” said Dabur in an exchange filing.

Dabur India sees 13% growth globally

Furthermore, its standalone revenue, mainly from domestic business, was 8.17% lower at INR 2,143.58 crore in the September quarter. “Our focused approach towards expanding our rural footprint to over 1.22 lakh villages reaped a rich dividend as rural demand outpaced urban demand by 130 bps during the quarter,” said CEO Mohit Malhotra.

Notably, FMCG giant’s International Business grew by 13% in the second quarter on a constant currency basis. “The Egypt business reported nearly 73% growth, while the MENA region grew by 10%, and Sub-Saharan Africa grew by 2%. The Badshah business also saw a 15% growth in Q2,” it said.

In the Q2, Dabur’s consumer care segment revenue fell by 4.13% to INR 2,487.60 crore. The food business saw a 13.45% drop to INR 467.39 crore, and revenue from the retail business decreased by 5.9% to INR 28.11 crore.

“Over the past couple of years, we have witnessed a marked shift in consumer buying patterns in favour of emerging channels like quick commerce, driven by the convenience this channel offers. This has resulted in the emerging channels growing at high teens, putting the General Trade under stress,” Malhotra added.

To adapt to market changes and support distributor partners, Dabur decided to adjust its inventory in General Trade, causing a temporary sales dip this quarter. “However, the move has resulted in improving the long-term health and hygiene of our business, paving the way for healthy growth going forward,” stated Malhotra.

Additionally, Dabur India owns brands like Dabur Amla, Dabur Vatika, Dabur Chyawanprash, Dabur Honey, Honitus, PudinHara, Dabur Lal Tail, and the juice brand Real. On the Brand’s future, Malhotra said, “We expect a recovery in consumer demand in the coming quarters, both in urban and rural markets. We are focusing on strengthening our competitive edge in the marketplace by investing in scaling up our rural footprint and rolling out consumer-centric innovations.”

To cater to this wider network, we have expanded our product basket with the launch of affordable and rural-specific pack bundles across categories, besides investing in consumer activations in the hinterland to establish a better connection with our consumers,” Malhotra further added.

Moving forward, Dabur India announced that its board has declared an interim dividend of 275% for FY 2024-25, which amounts to INR 2.75 per share, each having a face value of INR 1.

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Ninjacart’s revenue soars by 74%, hits INR 2000 Cr

By
Ashutosh Dubey
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0

Ninjacart, a B2B agritech startup, saw its operating revenue rise by 74% in FY24, reaching INR 2,002.7 Cr, up from INR 1,153.4 Cr the previous year.

Ninjacart cuts revenue losses to INR 259.6 Cr

According to INC42, the company cut its net loss by 20% to INR 259.6 Cr in FY24 from INR 326.3 Cr the previous year. This was due to various strategies to lower costs and boost business volumes. Ninjacart also added premium fruits and vegetables to its offerings.

Continue Exploring: Meesho slashes losses by 96.6% in FY24, orders surge by 36% YoY

Furthermore, the company used AI to cut waste in its fulfilment business, improving supply chain efficiency. Ninjacart is also expanding into new channels and customer segments, especially in tier 2 and 3 cities, by working with local traders and retailers.

The company to become profitable by FY26- Ninjacart CEO

In a media release, Ninjacart’s co-founder and CEO Kartheeswaran KK stated, “We are thrilled to report these positive numbers, which reflect our unwavering commitment to transforming the agricultural ecosystem in India. Our continued investment in technology and partnerships is enabling us to provide high-quality produce while simultaneously empowering farmers, traders, retailers and local economies.”

Continue Exploring: Country Delight secures INR 200 Cr in debt funding from Alteria Capital

It’s worth noting that last year, KK mentioned the company expects to become profitable by fiscal 2026.

Established in 2015 by Thirukumaran Nagarajan, Sharath Loganathan, Sachin Jose, Kartheeswaran KK, and Vasudevan Chinnathambi, Ninjacart started as a B2C business but later shifted to the B2B model. It competes with companies like WayCool Foods, Dehaat, and FarmLink.

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Meesho slashes losses by 96.6% in FY24, orders surge by 36% YoY

By
Ashutosh Dubey
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Meesho‘s operating revenues surged by 32.7%, reaching INR 7,615 Cr in FY24, up from INR 5,735 Cr the previous year.

Meesho adjusted losses to INR 53Cr

According to INC42, the startup reduced its adjusted losses to INR 53 Cr in FY24, a 96.6% decrease from INR 1,569 Cr last year, as stated in their blog on October 30. This figure excludes Employee Share-Based Compensation expenses.

Continue Exploring: Country Delight secures INR 200 Cr in debt funding from Alteria Capital

Meanwhile, e-commerce major’s higher revenue and reduced losses were due to more users and more frequent orders from existing customers. Orders delivered grew by 36% year-on-year to 843 million in FY24, up from 622 million in FY23.

“We became the first horizontal Indian ecommerce company to achieve profitability during the year and the first to generate positive free cash flow,” Meesho wrote in the blog post. They achieved an operating cash flow of INR 232 Cr for FY24. The company improved logistics, used Generative AI and Machine Learning for better discovery, and enhanced in-app experience and 24/7 customer support.

Continue Exploring: Rare Rabbit Reports Double-Digit Profit Surge, Revenue Soars by 69%

Meesho secures about $1.36 Bn

Furthermore, Meesho has successfully reduced its operational expenses, thanks to growing consumer awareness and the efficiency of its online marketplace model. The company’s selling, management, and administrative costs have decreased significantly as a percentage of revenue.

Established by Vidit Aatrey and Sanjeev Barnwal in 2015, Meesho began as a social ecommerce startup. In 2022, it shifted to a marketplace model to compete with giants like Flipkart and Amazon. The startup has raised about $1.36 Bn and is currently valued close to $5 Bn.

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