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The smaller Fast Moving Consumer Goods (FMCG) companies in India are expanding at a faster pace than their larger, more established counterparts, according to a new report by Emkay Research. This shift is being driven largely by the nimbleness of smaller players in adapting to evolving market demands, particularly among the youth. Their quicker product innovation and better alignment with contemporary consumer preferences have helped them gain a competitive edge.

“A quick comparison of growth trends across company sizes... indicates that smaller FMCG players are outpacing larger peers,” the report noted, pointing to their ability to respond swiftly to changing trends and consumer behavior.

One of the key enablers for this trend is the rise of digital commerce platforms. The report highlights that modern trade, including e-commerce and quick commerce, now accounts for roughly 20 per cent of the FMCG market. These platforms have provided smaller brands with equal access to consumers, allowing them to compete directly with major industry players without traditional barriers.

Meanwhile, larger FMCG firms have struggled to keep up with this transformation. Persistent price hikes have diminished their value-for-money appeal, while their heavy reliance on general trade channels—where legacy products dominate—has made it difficult to pivot quickly to emerging demands.

Large Players Face Distribution And Innovation Gaps

Despite the rapid growth of modern retail formats, the report points out that these channels have yet to fully meet the expectations of today’s digitally-savvy shoppers. Quick commerce platforms are outshining both e-commerce giants and brick-and-mortar modern retailers in terms of product variety and availability, particularly for digital-first and niche brands.

The report further emphasizes that these newer platforms offer superior consumer insights, engagement tools, and increasingly push their own private label products, posing an added challenge for established companies.

Call For Urgent Adaptation By Legacy Brands

Although the overall outlook for the FMCG sector is turning positive, Emkay Research warns that traditional players must act swiftly to stay relevant. This includes rethinking their product portfolios, enhancing their digital and omnichannel strategies, and aligning more closely with the expectations of the modern Indian consumer