Coronavirus impact | Retail channels see sharp fall in growth: Nielsen India

Most retails channels, barring modern trade, have taken a hit in the last week of March on the back of novel coronavirus-led lockdown.

Nielsen India research revealed that traditional trade, e-commerce and cash and carry have seen a sharp fall in the last week of March.

The only trade category that registered six percent growth in the last week of March was modern trade.

Of all the four channels, e-commerce was worst hit registering 64 percent fall in growth in the week-ending March 29. In comparison, during the first three weeks of March, it reported a 103 percent growth, 87 percent, 85 percent, respectively.

Growth in the cash and carry trade channel fell 44 percent, while traditional trade fell 6 percent in the last week of March.

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The fall was propelled by supply chain issues and shortage of staff at retail, Nielsen India said.

"We saw some bits of pantry loading in the first few weeks of March. Challenges on the replenishment front resulted in the out of stock situation post implementation of the lockdown," Sameer Shukla, West market leader, Nielsen Global Connect, South Asia, said.

Eight out of 10 retailers faced supply and out of stock challenges. Around 15 percent consumers found grocery and essentials out of stock and 22 percent each found salty snacks and ready to eat foods out of stock.

In India, 'evolved hygiene' products and staples saw a high demand and growth rate.

On the evolved hygiene front, hand wash, hand sanitisers and floor cleaners saw high growth.

Within the food space, packaged atta, packaged rice, breakfast cereal, and cheese saw high growth.

A survey with top industry leaders conducted by Nielsen revealed that supply chain and mobility issues have emerged as the biggest industry concern in the FMCG and retail space, followed by production capacity shortage and sourcing of raw material

Going forward, 57 percent of industry leaders said more focus on e-commerce will be the top priority in the next 12 months.

Post COVID-19, Nielsen India expects that there will be a change in the way India shops.

Technology is also expected to act as a catalyst for convenient consumer experiences.

"Consumers will be bearish on discretionary spends in the upcoming months. The focus on health and hygiene and financial security may be some future behaviour shifts," Shukla said.