Consumer Discretionary

Numbers Behind FMCG Industry At Bangladesh: Growth Opportunity Perspective

<p style="text-align: justify;">Global market size of FMCG is expected to reach $1.54 trillion by 2025. Whereas Bangladesh Consumption expenditure clocked at 97% of national income with domestic annual consumption standing at over $130 billion, Rise and sustenance of FMCG industry at Bangladesh few key drivers. Thus, Bangladesh represents a goldmine at FMCG industry. An island of stability during times of economic uncertainty.Several catalysts, with generic competitive advantages, are responsible for this fortune which can be categorized as following:</p><ol style="text-align: justify;"><li style="text-align: justify;">Rapid&nbsp;Rural to Urban Immigration Drives Demand As job opportunities are typically concentrated, consequently spending on FMCG products originate from urban centers with 35.70%</li><li>According to the Boston Consulting Group, strong economic growth of Bangladesh 34 million people belonging to MAC By the year 2025, As the process unfurls, FMCG industry should be able to capitalize the opportunity.</li><li>EPZ created many jobs for women, which helps in poverty reduction the first categories of products to increasing demand of FMCG products.</li><li>Due to climate, geographic positioning, Bangladesh represents a gold mine of raw materials &amp; cheap labor for companies in the FMCG industry.</li><li>Bangladeshi consumers are optimistic variety. More than 60% believe incomes will increase every year.79% believe living conditions have improved. Consumers prefer products of higher quality as they move into the future.</li></ol><p style="text-align: justify;"><strong>The missing point: Bangladesh&rsquo;s gender wage gap lowest in the world</strong>.</p><p style="text-align: justify;">It appears very positive and inspiring; Bangladesh is the only country in the globe, where the factor-weighted hourly wage gender pay gap is&nbsp;positive. As&nbsp;per the latest report of the UN, the gender wage gap in Bangladesh is the lowest in the world, as it came down to 2.2% last year against the world average of 21.2%. As per a report from the International Labor Organization (ILO), &ldquo;World Employment and Social Outlook Trends 2020&rdquo;, women&rsquo;s unemployment rate came down to 6.2% in 2019 from 6.6% in the previous year. Participation of women in labor market was 36.3% in 2019, whereas male participation in job market was 81.4%. According to the Global Gender Gap Report 2020, companies with female-majority ownership in Bangladesh are only 1.70%, whereas firms with female top managers are 4.80%.<em>&nbsp;</em></p><p style="text-align: justify;"><strong>Bangladesh&nbsp;is&nbsp;emerging &amp; safe geography for investment</strong></p><p style="text-align: justify;">Asian Development Bank (ADB) has placed Bangladesh on top of the list of South Asian nations as it predicted 7.8 per cent GDP growth for the country in 2020 fiscal amid coronavirus carnage across the&nbsp;world. On&nbsp;average the South Asian region will gross 4.1 per cent GDP growth while India will make 4 per cent, Pakistan 2.6 per cent, Bhutan 5.2 per cent, Nepal 5.3 per cent, Sri Lanka 2.2 per cent, Afghanistan 3 per cent and Maldives -3 per&nbsp;cent. Bangladesh&rsquo;s&nbsp;inflation will climb to 5.6 in 2020 FY from 5.5 last year which is very nominal compare with other countries. Today, 47.8 percent of the population comprises of youth. Of this, 32.3 million are 15- to 24-year-old, while 46.6 million are under the age of 15. As today&rsquo;s children are tomorrow&rsquo;s young adults, Bangladesh is currently crossing through a demographic window of change.&nbsp;Which concludes Bangladesh is&nbsp;emerging &amp; safe geography for investment.&nbsp;</p>
KR Expert - Zahir Uddin

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