In this article we are going to list the 15 largest FMCG companies in the world. Click to skip ahead and jump to the 5 largest FMCG companies in the world.
So what exactly does an FMCG company refer to? Well, FMCG stands for fast moving consumer goods, and encompasses all types of goods. So basically, any good that can be manufactured quickly and is generally mass produced is considered to be FMCG and the company producing them known as an FMCG company. The FMCG sector can encompass several industries including cigarette and tobacco, food (which is perhaps the biggest industry within FMCG), beverages, toiletries and batteries among many others. Hence, you can agree that the FMCG sector is quite diverse, and one of the most important sectors in the world as well, which is perhaps why it is worth approximately $15 trillion globally.
While it may be a huge sector, being an FMCG company is not an easy thing. Margins tend to be extremely low with low barriers to entry and hence high competition. In fact, the profits of an FMCG are rather reliant on volumes rather than high prices as many of these goods, barring cigarettes of course, tend to be price elastic, and hence can put off people with a price rise. Furthermore, many of these goods generally tend to have a short shelf life and hence, have to quickly get their product out and sell it to avoid expiration costs as well as warehousing costs. So basically, for an FMCG company to grow and earn profits, they need to sell as much volume as they can, and quickly and consistently, otherwise they’ll be in a bit of trouble. In addition, now that the world has grown environmentally conscious and realized the damage that packaging does to the environment and the fact that it is not sustainable, FMCG companies are under pressure to provide environmentally friendly packaging, which is also raising costs. This increase in costs is affecting the already low margins in the industry, though the 15 largest FMCG companies in the world are unlikely to face such issues, considering their profits are already in billions of dollars.
Of course, the strength of the FMCG sector, and any other sector in the world basically, has been significantly impacted by the Covid-19 pandemic. Originating in China, the virus spread across the world and has infected over 60 million people, killing more than 1.4 globally as well. To prevent its spread, most countries across the world went into lockdown, with all businesses other than essential businesses being closed down, affecting billions of people. These lockdowns have affected many FMCG companies as well, but mostly those who are in the non-essential category. Many companies, especially food and beverages companies, have also seen a major jump in demand as people increased their consumption while in lockdown, though other industries such as the alcohol industry still face a long recovery, as it has been weighed down by travel retail exposure and on-trade exposure. Many countries blocked alcohol sales, including India and South Africa to allow for a smoother lockdown.
The largest FMCG companies in the world include companies which are among the largest beverage companies in the world and the largest dairy companies in the world. These companies have accumulated assets of over $1.2 trillion while the market cap was nearly $1.9 trillion as well. The total revenues of these companies are over $670 billion and the total profits are worth nearly $81 billion. These are also some of the most well known companies in the world, owning brands which you are more likely than not to have in your own house as well. These companies are from the food and beverages industry, cigarette and tobacco industry, meat industry and household products industry as well. So let’s take a look at the companies responsible for most of the products in our households, starting with number 15:
15. Kraft Heinz (NASDAQ:KHC)
Total market cap of the company (in billions of dollars): 39.78
Total revenue of the company (in billions of dollars): 18.2
Total assets of the company (in billions of dollars):): 22.9
Total net profit of the company (in billions of dollars): 1
Headquartered in the US is one of the biggest American food companies in Kraft Heinz, where in addition to Kraft and Heinz, there are at least 20 additional major brands including Boca Burger and Gevalia.