₹5, ₹10 Pack Maths No Longer Adds Up For FMCG Majors

“₹10 will become the new ₹5. ₹15 will become the new ₹10. ₹20 will become the new ₹15… and so on”.

This is a blunt forecast analysts have given for the FMCG sector which is facing a synchronised triple shock of rising costs, weaker mobility and competition from the quick commerce platforms.

The shift is already visible in the industry’s changing price-pack strategy. According to NielsenIQ’s FMCG Quarterly Report for Q2 2026 (AMJ’26), the FMCG sector is witnessing a decline in the share of magic price points (MPPs) such as ₹5 and ₹10 packs across categories, with the impact more pronounced among smaller players.

Maggi becomes a suitable example here. Its smaller pack that used to cost ₹10 years ago, is now being sold into the range of ₹12-₹15. Similarly, ₹5 Maggi packs have become hard to see in the market. And same goes with the triangular Frooti pack, which was once retailed at ₹3. But now, the “affordable” pack has largely disappeared from the market.

The same strategy is playing out in the biscuits aisle. Britannia has signalled further price adjustments of 1.5-2% in the September quarter, primarily through grammage reductions in its ₹5 and ₹10 packs, as input costs continue to rise.

But this is not something new for FMCG players. Parle G offers a telling example of how FMCG companies have used “grammage cuts” or “shrinkflation” to preserve familiar price points. Data shows that its small pack, which weighed 100 g in 1994, had shrunk to 55 g by 2022. The quantity fell by 45% over the period, while the pack’s price remained at ₹4 until 2021, when it was raised to ₹5.

The strategy allowed the brand to maintain an accessible entry price for years, even as consumers received fewer biscuits for the same outlay.

In short, the small packs worth ₹5 and ₹10, seemingly immovable numbers, have been more than just price points. For brands, these have been entry points to lure consumers towards a snack sachet or a drink without thinking twice about the hit to the household budget. And for consumers, it’s about affordability.

But the paradox is that companies may be struggling to make the maths work even as consumers continue to want the products at the same price.

The Price Points Hard To Quit

It has become back-breaking for FMCG companies to deal with low-priced packs as consumers do not necessarily accept even small price increases. “A product priced at ₹5 cannot easily move to ₹6 or ₹7, just as a ₹10 pack cannot simply become ₹12,” says Amit Lohani, Founder Director of Forum of Indian Food Importers (FIFI).

Instead, he says, brands often move consumers to the next established price point, even if that means offering a larger pack at ₹10 or gradually phasing out the cheaper option. He expects the pressure to push price points higher across the board.

“Everyone will move away from ₹5 packs to ₹10. And then ₹10 will become ₹15. ₹15 will become ₹20 and ₹20 will become 30. Currently, there is no way out with all these prices and the inflationary aspect of trade,” he adds.

Lohani further points to the pressure on retailers and distributors, who must stock large numbers of low-value packets despite limited shelf and display space. “There is no display, so you have to hang them from a wall. How many ₹5 packets will you hang from a wall?”

That creates a problem beyond manufacturing costs. Even when consumers want inexpensive packs, the economics of distributing and displaying them can make them less attractive to the trade.

When ₹5 Stops Making Business Sense

For FMCG companies, the problem with low-priced packs is no longer limited to rising raw material costs. Packaging, transportation, manufacturing and distribution expenses are also squeezing margins, leaving brands with limited room to absorb further increases without changing prices or reducing quantities.

The pressure has intensified over the past six months as commodity prices, processing costs and logistics expenses have risen, according to Nishant Shekhar, Managing Director and Partner at Boston Consulting Group (BCG). He says that the impact is particularly acute for smaller packs, where packaging accounts for a larger share of the selling price. "The companies' margin on ₹5 to ₹10 is and will continue to remain challenging," Shekhar adds.

The problem extends beyond manufacturing costs to the economics of getting these products to consumers. Retailers, according to Lohani, typically earn margins of only 7-8% on such products, while having to bear rental, electricity and staffing costs.

Low-priced packs also occupy shelf space and require retailers to stock several small packets to generate meaningful sales, he says. The economics become more difficult when products have to travel long distances. According to Lohani's estimates, transporting a truckload of chips from Delhi to Mumbai can cost around ₹1 lakh, while the goods carried may be worth only ₹3 lakh-₹5 lakh. Since lightweight, air-filled snack packets take up considerable space, freight costs can eat into the already limited margins.

This could favour regional brands that manufacture closer to their markets. "Companies operating within a radius of 100–500 km may find it easier to sustain low-priced products than brands distributing nationally," Lohani remarks.

The manufacturers of snacks and beverages are also trying to control costs through packaging innovation and more efficient production. Prabhu Gandhikumar, Founder of TABP Snacks & Beverages, says that at his company, the weight of a 200 ml beverage bottle has been reduced from approximately 15.5 g eight years ago to around 8.6 g through changes in bottle's neck design.

"When we started eight years ago, the bottle used to weigh approximately 15.5 grams for a 200 ml bottle. Today, it has come down to around 8.6 grams. Why 8.6 grams? Because we're able to reduce the neck sizes," Gandhikumar says.

Even after such measures, the company's margins are under pressure, as he says that the company's gross margins have fallen from around 30% to 22%, and is expected to decline further. "This year has been a bad year, and there is nothing we can do about it but eat into the margins... This year, we’d be striving hard for break-even, but it looks very tough... We are sure we are going to be in losses but, we'll have to take it up,” he says.

The figures underline the difficulty of protecting a fixed price point through cost-cutting alone. Reducing packaging weight can help, but manufacturers cannot keep cutting indefinitely without affecting the product or the consumer's perception of value.

The Shrinkflation Ceiling

When raising prices risks alienating consumers, reducing the quantity inside a pack becomes an alternative. But this strategy has its limits, particularly when a product becomes too small to deliver the experience consumers associate with the brand.

For instance, a ₹5 potato chips pack has become difficult to find, with the quantity in some packs falling from around 17g to 8g over time. In beverages, he says, a product that was previously sold in a 200 ml pack may now be available in a 75 ml pack at ₹10.

For companies, reducing grammage can protect the headline price without requiring a direct increase. But Lohani believes the strategy is approaching a limit in some categories as the customers can feel cheated if the companies reduce the quantity too much. He argues that if the company goes beneath the 20-gram bracket, then "the consumer feels cheated when he opens up a pack and he finds three biscuits or two biscuits or five biscuits."

Packaging costs add to the difficulty with companies now exploring cheaper, lighter alternatives to conventional multi-layer packaging, which helps preserve freshness and shelf life but can be expensive.

There is also a risk that repeated reductions in quantity could undermine the product itself. According to BCG's Shekhar, companies are increasingly making the ₹10 and ₹20 propositions more attractive, while the quantity offered at lower price points continues to decline.

Therefore, the concern is not simply whether consumers receive fewer grams or millilitres. It is whether a smaller pack can still deliver the taste, ingredients and overall experience expected from the brand. Experts say that the cost reduction can bring compromises in product quality, making the strategy difficult to sustain indefinitely.

₹20 Brings Better Value

As the scope for further grammage cuts narrows, companies are attempting to persuade consumers to move to higher price points by offering more quantity for a relatively modest increase in spending.

The shift is being driven primarily by brands trying to protect profitability, rather than consumers independently abandoning cheaper products. If the quantity in a ₹10 pack falls sufficiently, a ₹20 pack offering better value may become more attractive. "The ₹5 and ₹10 grammage or ML keeps reducing and therefore the customer will think 'why do I buy a ₹10 pack? Instead of buying two packs of ₹10, let's buy a ₹20 pack because it gives me better grammage, more quantity, better consumption," Shekhar reasons.

This is a calculated change in price-pack architecture. Rather than raising the price of an existing pack by an amount consumers may resist, companies can encourage buyers to spend more by presenting a larger pack as better value.

However, not all the experts believe that the attractiveness of such price points can be taken away. Ravi Kapoor, Partner at PwC, says the appeal of small packs cannot be separated from the role they play in expanding branded consumption. According to him, a low-priced pack gives consumers an opportunity to try products that might otherwise remain beyond their immediate budget. As incomes and consumption patterns evolve, some buyers may subsequently move to larger packs, he says.

The distinction is important because affordability is not always about the lowest price per gram. Consumers may choose smaller packs to manage immediate spending or control how much they consume on a particular occasion.

Kapoor points to products such as edible oil, which consumers may buy in 100 ml packs rather than larger bottles, depending on their needs and budgets. Small packs also help expand access to categories such as sanitary napkins and baby diapers, where lower initial spending can encourage first-time purchases.

For brands, he says the challenge is to balance three competing considerations viz., the price consumers are willing to pay, the profit earned on each unit and the quality of the product delivered.

He believes that the economics of small packs can still work when lower margins per unit are compensated for by sufficient sales volumes. But companies cannot indefinitely sustain products when neither margins nor volumes justify the cost.

The Rural Consumer Roadblock

For rural consumers, small packs are often less about getting the best value per gram and more about keeping the immediate cost of a purchase manageable. Low-priced sachets and packs of products such as shampoo, hair oil, detergent and biscuits allow households to buy branded goods without committing to larger quantities.

The continued importance of smaller packs is reflected in industry data. Packs priced at ₹5 and ₹10 accounted for 60-65% of Britannia Industries’ sales, while smaller packs contributed 30-60% of sales across categories such as biscuits, soaps, detergents, shampoo and staples, Britannia's Rakshit Hargave said, as per a report by The Economic Times published in June 2026.

The declining share of ₹5 and ₹10 packs, therefore, should not automatically be read as weakening demand. Kapoor argues that small packs remain important for bringing more consumers into the branded market. Better physical infrastructure, digital connectivity and wider distribution have helped companies reach smaller towns and rural markets, but affordability remains a consideration. “The ₹5 and ₹10 packs are going to be very, very critical in doing that,” he says.

For households with limited disposable income, the ability to buy a smaller quantity at a lower upfront cost can matter more than the price per gram. These packs also give consumers the flexibility to make purchases according to their immediate needs and budgets, rather than setting aside money for a larger pack as their incomes are irregular and are based on daily wages or agricultural output.

Availability, however, varies by category and brand. Shekhar says some companies may withdraw low-priced products from markets where they are no longer commercially viable while retaining them in areas where they help attract new consumers. Value-focused biscuit brands such as Parle-G and Sunfeast continue to offer ₹5 packs, he says, reflecting the role of these products in reaching price-sensitive buyers.

Demand for low-priced beverages also remains strong as TABP's Gandhikumar says his company is struggling to meet demand for its ₹10 products, even as manufacturing costs put pressure on margins. This highlights the distinction between consumers losing interest in a product and manufacturers finding it difficult to supply it profitably.

For manufacturers, the cost of reaching rural consumers can further complicate the economics. Rising freight costs, packaging expenses and imported commodity prices are adding to the burden. Products that require cold-chain infrastructure, including certain dairy beverages, may find it particularly difficult to remain viable at ₹10, Lohani says.

Regional manufacturers with local production and distribution networks may be better placed to serve these markets. For national brands, the challenge is to balance the cost of distribution against the need to retain affordable options.

The pressure on small packs is thus not simply a question of whether consumers want them, but whether companies can continue supplying them at price points that rural households can afford.

₹5 And The Rising FMCG Price Ladder

The emerging picture is not one in which ₹5 and ₹10 packs disappear across the FMCG sector overnight. Instead, companies are increasingly deciding where these price points remain commercially viable and where consumers can be moved towards larger packs.

The decline in the share of low-priced packs varies across categories. In some snack categories, Shekhar says, ₹5 products are losing ground to ₹10 and ₹20 packs. In other categories, the pressure is shifting consumers from ₹10 to ₹20 or from ₹10 to ₹50. “I don't think it is going to vanish in the months and the year, but I think it is surely going to decrease in the saliency in the overall market,” he says.

Quick commerce may reinforce this trend, but this cannot be the principal cause. According to him, the channel accounts for around 5–10% of the overall market and brands generally use quick commerce to reach more premium consumers rather than to push entry-level packs.

The ₹10 beverage segment, according to Gandhikumar, is expected to survive for at least another four to five years. He argues that manufacturers still have room to reduce pack sizes and improve production efficiencies. He also believes Indian brands could benefit if multinational companies withdraw from price points they find unprofitable.

But, over time, inflation and currency depreciation could push the entire price ladder upwards. What consumers consider an affordable entry-level purchase today may carry a higher price tag in the coming years.

For now, the task for FMCG companies is to decide how far they can stretch the economics of small packs without damaging margins, product quality or consumer trust. The ₹5 and ₹10 price points may retain their psychological appeal, but their future will increasingly depend on whether manufacturers and retailers can make the numbers work.