Signs of spring in China’s 2023 FMCG sector signal optimism
Bruno Lannes
Senior Partner at Bain & Company based in Shanghai
Although the first quarter’s value growth rate might appear modest, the story is very different on a month-by-month basis. While January consumption was severely affected by a Covid outbreak, the FMCG sector started its growth trajectory in the months after. Full recovery will take time, and we think the first quarter numbers are tracking well.
In April, the year-on-year FMCG growth rate reached 5.1%, in line with pre-pandemic levels. Overall retail sales, excluding auto, also saw impressive growth at 16.5%.
Packaged food and home care continued to grow; personal care and beverage showed signs of recovery
Deflationary pricing trend across categories further diverged
E-commerce reaccelerated, club warehouses soared, and O2O sustained growth
Derek Deng
Partner and Head of Consumer Product practice in Greater China
Chinese consumption is recovering, and the government has already implemented stimulus policies to boost consumption, with more expected. The FMCG industry continues to demonstrate resilience, and consumers, brands, and retailers adapt to ever-changing circumstances. The industry’s recovery is likely to take shape over the coming months, repeating a few trends from the first quarter of the year.
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