Parle to Raise Prices and Cut Weights in Response to Rising Input Costs

Parle Products, one of India’s leading fast-moving consumer goods (FMCG) companies, has announced a strategic move to address escalating raw material costs by introducing price hikes and reducing product weights.

Starting January 2025, prices across Parle’s product portfolio will increase by at least 5%. This adjustment will apply to a variety of its offerings, including bread, biscuits, rusks, cakes, and snacks.

In tandem with these price revisions, Parle is also set to reduce the grammage of its entry-level and low-unit price packs. For instance, popular items like the Parle-G ₹5 and ₹10 packs, along with other smaller biscuit packs, will witness a reduction in weight by 5% to 10%, depending on the pack size.

Factors Driving the Price and Grammage Adjustments

The decision to adjust prices and reduce weights comes against the backdrop of rising input costs:

• Raw Material Price Surge: The costs of essential ingredients such as wheat flour, sugar, and cocoa have seen significant increases.

• Palm Oil Import Duty: A steep rise in import duties on palm oil has further exacerbated the inflationary pressure. Palm oil prices have surged by nearly 45%, adding to the overall cost burden for manufacturers.

These inflationary trends have left companies like Parle with little choice but to adjust their pricing and production strategies to remain viable while offering competitive products.

Parle’s Strategy in Context with Industry Trends

The FMCG industry is witnessing a wave of similar pricing adjustments as companies grapple with rising costs. Britannia, another leading player, recently announced price hikes across several product categories and plans for additional increases of 4%-5% over the next two quarters for certain SKUs that remain unadjusted.

Parle’s move to balance price hikes with grammage reductions reflects an effort to maintain consumer affordability while managing production costs. This approach ensures that low-income consumers, who often rely on smaller, budget-friendly packs, are not overly burdened.

What It Means for Consumers

As inflation impacts essential FMCG products, consumers are likely to feel the pinch. Items like biscuits, bread, and snacks, which form part of daily consumption for millions of households, will see price increases and slight weight reductions. However, companies are striving to strike a balance to ensure their products remain accessible to the masses while navigating a challenging cost environment.

Looking Ahead

The FMCG sector is expected to experience continued cost pressures, prompting further price hikes across the board. While consumers may face higher expenses for staples, companies like Parle and Britannia are focusing on cost-efficiency and innovative pricing strategies to minimize the impact on end-users.

This evolving landscape underscores the importance of adapting to global and domestic market dynamics as companies prioritize sustainability in operations while catering to consumer needs.

About Parle Products

Parle Products is one of India’s leading fast-moving consumer goods (FMCG) companies, widely recognized for its iconic biscuits, snacks, and bakery products. Established in 1929 in Mumbai, Parle has grown into a household name with a rich legacy of providing affordable, high-quality products to millions of consumers across India and internationally.

Key Milestones

1. Introduction of Parle-G: Known as the world’s largest-selling biscuit, Parle-G is a staple snack for generations in India and is synonymous with the company’s success.

2. Diverse Portfolio: Parle’s product range includes biscuits, cookies, rusks, cakes, wafers, and snacks. Some of its popular brands include Hide & Seek, Krackjack, and Monaco.

3. Global Reach: With exports to over 100 countries, Parle continues to represent India on the global stage, bringing the taste of its heritage to international markets.

Focus on Affordability and Quality

Parle Products is dedicated to delivering value to its consumers, particularly through its low-unit price packs. These affordable offerings have made Parle-G a trusted choice among lower-income groups and rural households.

Commitment to Sustainability

In recent years, Parle has been actively working to enhance sustainability in its operations. The company has focused on reducing its carbon footprint, optimizing packaging, and promoting environmentally friendly practices.

Parle’s Market Position

• Leader in Biscuits: Parle enjoys a significant market share in the Indian biscuit industry, competing with other major players like Britannia and ITC.

• Expanding Categories: The company continues to innovate by introducing new flavors, healthier alternatives, and premium snack options to cater to changing consumer preferences.

Parle Products Cultural Impact

Parle’s products have become an integral part of Indian culture, often associated with tea-time snacks and childhood memories. The iconic packaging of Parle-G, featuring a little girl, has remained largely unchanged, adding to its nostalgic appeal.

Parle Products Future Vision

Parle aims to maintain its leadership in the FMCG sector by focusing on affordability, innovation, and global expansion. Despite challenges like rising costs, the company remains committed to balancing quality and accessibility for its diverse consumer base.