FMCGs find an unlikely saviour in RWAs

Bengaluru | Mumbai: More than a dozen consumer goods companies including Hindustan Unilever, ITC, Mondelez, Procter & Gamble, Dabur and Colgate have started selling products directly to consumers. That’s circumventing traditional trade and distributor networks in areas where last-mile delivery has been disrupted due to Covid-19 restrictions.Their latest direct-to-home initiatives involve partnering startups such as Dunzo, Scootsy and Swiggy by listing brand stores on their portals and even reaching out to resident welfare associations (RWAs) through their sales staff.While retailers have been doing this for more than a month to implement physical-distancing norms after pantry loading led to increased footfalls, it is a first for fast-moving consumer goods (FMCG) companies.“These partnerships are a vindication of the power of collaboration as no brand alone has answers to fulfil the needs of the nation during these unprecedented times,” said B Sumant, executive director at ITC Ltd, which is also selling products through its own portal.As companies grapple with a shortage of staff with migrant workers having left for their homes, the supply chain has been thrown into disarray across the ecosystem — from sourcing raw materials to manufacturing and delivery of finished products.“We are deploying new strategies and finding innovative solutions to ensure uninterrupted supply of essential products to our consumers,” said Mohit Malhotra, CEO, Dabur, which has tied up with online delivery service providers for retail outlets and households. 75440782Storefronts on Delivery Platforms“Our sales officials are reaching out to RWAs across the country and ensuring availability of our range of immunity boosters,” Malhotra said.FMCG companies have set up storefronts on hyperlocal delivery platforms and are servicing orders from exclusive brand stores and directly from distribution centres, using delivery partners to get items to the doorstep.Food ordering firm Swiggy has expanded its store network to more than 200 cities, allowing consumers to order groceries from neighbourhood shops. “Through these partnerships, we are extending our hyperlocal delivery offering to unlock a new dimension of convenience for our consumers as well as earnings for our delivery partners,” said a Swiggy spokesperson. “Considering the present situation, our primary focus has been to address customer needs and pain points and their biggest ask has been to enable easy access to groceries and essentials.”Companies aren’t sure whether such initiatives will become established as a regular part of their supply chain, which has traditionally depended on distributors and retailers while they focus on manufacturing and promoting brands. “We will continue to evaluate and expand such opportunities with our partners to serve our consumers during this difficult time,” said a P&G spokesperson. “In addition, we continue to make interventions to strengthen our end to end supply chain to serve consumers with our products across different channels.”Hyperlocal partners offer consumer goods makers easier access to customers amid the lockdown.“Dunzo ensures demand density for these brands, and as long as we are able to maintain that, brands should continue to leverage the on-demand experience of Dunzo,” said Kartik Mishra, head of strategy and new initiatives at the startup. “Direct to consumer (D2C) just becomes an additional distribution channel for brands in addition to traditional retail and ecommerce that they already have.”Experts feel single-brand stores on hyperlocal platforms will see low traction as consumers will prefer to get everything they need rather than stick to one label. “While we have cut out retailers from the equation now, we will have to wait and watch if these partnerships continue post the pandemic,” said an executive at a hyperlocal startup. “If demand drops post the lifting of the lockdown, neither us nor the brands might want to continue these partnerships.”

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