Lays potato chips are a popular FMCG product owned by PepsiCo. Some key factors that determine the demand for Lays include: 1) Its widespread brand recognition and variety of flavors that appeal to different tastes. 2) Affordable price makes it accessible to a large population across different income groups. 3) Heavy advertising increases awareness and popularity, driving up demand.

1. Name – garima
Class – X B
Roll no. – 9

2. To take a fast moving consumer good (FMCG)
like washing machine detergent. Analyze the
factors that determine the demand of this
product. Present your findings in form of a
class presentation.

4. Fast Moving Consumer Goods (FMCG) – or Consumer
Packaged Goods (CPG) – are products that are
 sold quickly and
 at relatively low cost.
Examples include non-durable goods such as soft
drinks, toiletries, and grocery items. Though the
absolute profit made on FMCG products is relatively
small, they generally sell in large quantities, so the
cumulative profit on such products can be
substantial. Hence the profit in FMCG goods always
translates to the number of good sold .ITC
Limited, Procter & Gamble and Unilever are the
three biggest consumer goods company that operate
across the globe.
The term FMCGs refers to those retail goods that
are generally replaced or fully used up over a short
period of days, weeks, or months, and within one
year. This is either because of the high consumer
demand or because they tend to deteriorate rapidly.

5.  Frequent purchase
 Low involvement (little or no effort to choose
the item – products with strong brand loyalty are
exceptions to this rule)
 Low price

6.  High volumes
 Low contribution margins
 Extensive distribution networks
 High stock turnover

7. The Indian FMCG sector is an important contributor to the
country's GDP The Indian FMCG sector with a market size
.
of US $ 14.8 billion is the fourth largest sector in the
economy and is responsible for 5% of the total factory
employment in India. The lower-middle income group
accounts for over 60% of the sector's sales. At
present, urban India accounts for 66% of total FMCG
consumption, with rural India accounting for the remaining
34%.The growing incline of rural and semi-urban folks for
FMCG products will be mainly responsible for the growth in
this sector , as manufacturers will have to deepen their
concentration for higher sales volumes. Availability of key
raw materials, cheaper labor costs and presence across the
entire value chain gives India a competitive advantage.
FMCG sector will witness more than 60 percent growth in
rural and semi-urban India.

9.  Cumulative Profits
 For a retailer's bottom line, the key benefit of
CPGs/FMCGs is the cumulative profit they provide.
CPGs/FMCGs have low profit margins, which means that a
small percentage of each each unit sale represents profit.
However, CPGs/FMCGs also sell in very high quantities.
This means that those small profits add up and can form a
significant portion of a retailer's total profits for a fiscal
period. This profit serve any number of financial purposes
in the business.
 Cross Merchandising Opportunities
 Retailers thrive when customers buy multiple items on
each visit. CPGs/FMCGs provide opportunities for cross
merchandising, which occurs when a business places two
products from different categories close to one another in
a strategic arrangement. For example, an electronics
retailer may sell remote controls that have high profit
margins but don't fall into the CPG/FMCG category. A shelf
of batteries (which are CPGs/FMCGs) next to those
remotes provides a chance to boost sales and earn profit
on two items when customers choose to buy the batteries
they will need to operate their new remotes at the same
time.

10.  Brand Appeal
 When a retailer offers CPGs/FMCGs, it can rely on the
brand appeal that they generate to drive sales. Most
CPGs/FMCGs come from brands that advertise heavily. This
means that when customers see CPGs/FMCGs on store
shelves they have pre-existing emotional relationships with
those brands, which may not be true of the other items
that the retailer sells. Seeing recognizable brands may
build trust between the customer and retailer or lead to an
additional purchase based on brand awareness, with no
special effort from the retailer.
 Diversification
 Selling CPGs/FMCGs spreads a retailer's revenue sources
over a broader spectrum of goods. The profits can help
offset slow sales for other products during seasonal dips in
demand or periods of reduced consumer confidence. In the
category of CPGs/FMCGs, retailers can choose from among
an almost unlimited range of product types including
pharmaceuticals, food items, beverages, household
products and disposable items. The range is so broad that
some retailers, such as grocery stores and convenience
markets, stay in business selling them exclusively.

12. Basically there are only three disadvantages of the
fmcg :
 Since these goods are cheap in nature that is
they have a low price , they are not capable of
provididng immediate profit result . To obtain
results a long period of time is required and the
profits are cumulative in nature
 A lot of money is spent on advertizing and
making the brand name popular in order to avail
huge profits . This increase the cost price
considerably .
 It is not possible to store these goods for future
supply because these are homogenous good and
are a part of the perfect competition market .
Thus it is not possible to hoard these goods in
expectation of higher profits in future becauese
both the sellers and buyers are generally the
price takers.

13. Company Hindusta Indian Nestle Britania Dabur others
n Tobacco
Unilever company
ltd.
Market 36.4 % 30 % 8.2 % 6% 4.3 % 15.1 %
Share
HUL ltd .
ITC
Nestle
Britania
Dabur
Others

15.  Lays is a brand name for a number of potato
chip varieties as well as the name of the
company that founded the chip brand in the
year 1938. Lay’s chips are marketed as a
division of Frito lay, a company owned by
PepsiCo . Inc since 1965. other brand names
under this name include pretzels
, Doritos, kurkure , ruffles , cheetos etc.

16.  In 1932, salesman Herman Lay opened a
snack food operation in Nashville, Tennessee
and, in 1938, he purchased the
Atlanta, Georgia potato chip manufacturer
"Barrett Food Company, " renaming it "H.W.
Lay Lingo & Company."[citation needed] Lay
criss-crossed the southern United States
selling the product from the trunk of his car.
In 1942, Lay introduced the first continuous
potato processor, resulting in the first large-
scale production of the product.

17. TYPE POTATO–CHIPS
CURRENT OWNER PEPSICO
RELATED BRANDS FRITO LAYS, WAVY LAYS , PRINGLES
PREVIOUS OWNERS 1932 - HERMAN W. LAY
1936 - THE FRITO COMPANY AND LAYS
COMPANY MERGED TOGETHER
TO FORM FRITO - LAYS
1965 - FRITOLAY MERGED WITH THE
PEPSI COLA COMPANY TO FORM
PEPSICO. INC

18.  HAPPINESS IS SIMPLE ( 2009 )
 SIMPLY MADE. SIMPLY GOOD.( 2009)
 ANOTHER REASON TO SMILE! ( 2007)
 FOOD FOR THE FUN OF IT ( 2007)
 LAYS ! WANT SOME ? ( 2006 )
 BETCHA CAN’T EAT JUST ONE ( 196Os – 2006 )
 BE A LITTLE DILLOGICAL

20.  Lays markets hundreds of brands in
approximately 200 countries and territories
around the world . The customers have spent
an estimated of 107 billion US $ on the
products of the same .
 Pepsico has 18 megabrands that generate $ 1
billion or more each year in annual retail
sales. It’s economic reach is deep and
sustainable .

21.  from consumer’s view point :
 it is frequently purchased
 Consumer has low involvement in its purchase (little or
no effort to choose the item – products with strong
brand loyalty are exceptions to this rule)
 Low price

22.  It is sold in High volumes
 It has Low contribution margins
 It has Extensive distribution networks
 Provides a High stock turnover

23.  Brand name : lays is a very popular brand
name and trusted among most of the people.
This influences its demand on a huge scale.
 Quality product : Lays is a product of standard
quality having registered itself with the indian
health standards and thus is trusted by all .
 Taste and preferences : the taste and
preferences of a consumer affects the demand
of a product hugely . Since the lays potato chips
come in a huge variety of flavors it covers the
demand of a huge percentage of the population

24.  Hot ‘n’ sweet
 Magic masala
 Sweet onion sauce
 Hot ‘n’ lime twist
 Green chilli
 American cheese and garlic

25.  Price : lays has a nominal price ( Rs. 10 )
, and thus is affordable by a huge range of
people . It also follows the law of demand
because of which it’s demand is more since
it’s price is less.
 Population : lays is a form of potato chips
which is consumed by the people of all ages
, be it senior citizens or students.
 Government policy : there are no
government restrictions imposed on lays as
such because of which it can produce in
order to meet the demands.

26.  Advertisements : of all the factors mentioned
advertisements are the most important
determinant. Since potato chips are a
homogenous product by increasing the
ads, it’s polpularity can be increased .