Sajid Hasan, who launched a small supermarket named TM Bazar in the Rampura area earlier this year, saw initial success. However, since the political unrest in July, sales have plummeted. Even though the country is now somewhat stable, his sales have yet to recover.
"The primary sales of grocery stores or supermarkets depend on fast-moving consumer goods (FMCG), and those sales have not picked up yet. This has negatively impacted the overall grocery business," Sajid told Jago News.
FMCG market potential
Bangladesh has long been considered a potential growth market for consumer goods companies. FMCG products—such as food, beverages, cosmetics, and household essentials—are relatively low-cost and sell quickly. However, the demand for these products has significantly dropped since the July unrest, creating challenges for the country’s consumer goods manufacturers.
According to industry leaders, nationwide political instability has had a lasting effect on business. Additionally, high inflation, district-level flooding, and a decline in leisure shopping and entertainment have further dampened the FMCG market.
Bishwajit Saha, Director of City Group, a major player in the FMCG sector, explained: "Even though the situation is improving, the business climate is still difficult. After the unrest, the country was hit by severe flooding, and traders are currently facing tough times. Sales and product demand have decreased."
Bishwajit noted that consumers are now purchasing fewer products, which has led retailers to reduce their orders from manufacturers. "No one wants to take risks, and many traders are still concerned about the political and security situation. This has caused a 50% drop in sales in the FMCG market," he added.
Local brands leading the FMCG market
In Bangladesh's FMCG market, domestic brands have outpaced foreign ones. City Group, Pran-RFL, Meghna Group, ACI, Square, and Abul Khair Group dominate, while Unilever Bangladesh leads among foreign companies. Popular brands like Roopchanda (edible oil), Nestlé’s Maggi noodles, Ispahani tea, and Coca-Cola are key players in the market. Yet, most companies are reporting a significant decline in sales.
Taslim Shahriar, Senior Assistant General Manager of Meghna Group of Industries, explained, "Business is still stalled due to economic conditions. Tourism, hotels, and restaurants have not bounced back, and people aren’t going out as much. Foreigners aren't visiting either, which has further hurt our business. Normal business can’t resume until these situations improve."
Insights from wholesalers and retailers
Several wholesalers and retailers also commented on the changing shopping habits of consumers.
Abu Hossain, a retailer, shared, "Customers who used to buy larger quantities are now opting for smaller sizes—like 200 or 400 grams of milk instead of a full packet. They’re cutting back on non-essentials like floor cleaner and using detergents instead, and reducing luxuries like milk tea and Horlicks."
Retailers believe that the aftermath of the recent unrest continues to impact consumer behaviour. Many have lost jobs or fear losing them, and additional income streams have dried up. As a result, most families are focusing on cost-saving measures.
Economic and political uncertainty
Mizanur Rahman, a marketing professor at Dhaka University, highlighted the broader implications of political changes on the business environment. "Whenever there's a change in political power, it affects business—it’s a common pattern. The transition to new political stability takes time, and we are currently in an in-between state, which is why nearly all businesses are struggling," Mizanur said.
He further noted that the previous government had its own economic policies and development plans, many of which have now stalled. "New contracts, supply systems, and business operations are being developed, but it will take time. Additionally, people are still cautious, monitoring their expenses," he added.
Mizanur concluded by noting that the economy was already fragile under the previous administration, with stagnation in the banking, garment, and import-export sectors. "People were facing high inflation, and it will take another two to four months for the economy to stabilise."