2016 was another good year for consumer goods industry, both in terms of retailers and manufacturers. Fast-moving consumer goods (FMCG) market increased by 3.4 percent last year compared with 2015, Romanians having with an increased appetite for more expensive products, GfK shows in a study.
Behind this growth lies both a 3 percent increase in the purchased volumes and the uptrading phenomenon of (consumer’s orientation towards superior products in terms of price).
“Unlike the last year, the uptrading was reflected both in modern and traditional trade. Nationally, this phenomenon has led to a growth of 1 percentage point of premium brands, in the detriment of the other price categories,” the study reveals.
Romanians buy less goods for everyday use, but are spending more to a buying act. Reducing the frequency with which people go shopping was noted only in the categories of fresh food, while for household products, the purchase frequency increased.
Two thirds of the expenses go for food, the GfK study also shows.
Modern commerce covers 57 percent of total FMCG market in Romania. During 2016, modern retailers have gained two percentage points compared to 2015. Supermarkets and discount formats have contributed most to the growth of modern trade, gaining half a percentage point each.
Although they had a constant evolution during 2016 in terms of market share, hypermarkets remain the most important modern channel, cumulating nationwide more than a quarter of total FMCG sales for home consumption.
Among the most active retailers in terms of increasing market share were Lidl and Profi. Traditional trade had a negative evolution during 2016, the decrease by 2 percentage points was due to a reduction in the frequency with which Romanians are buying from the traditional formats.
This year, the GfK study’s authors expect a slower growth rate, compared to the previous years, given that 2017 will be characterized by inflation as a result of fiscal easing and VAT cut in 2015 and 2016.