Piyush Goyal's recipe for companies to get out of the consumption slowdown

Commerce and Industries Minister Piyush Goyal has a word of advice for companies trying to emerge from the ongoing consumption slowdown — cut prices!

Speaking at CNBC-TV18's Global Leadership Summit 2024, Goyal said that the industry and businesses should examine consumer choices and demand for more attractive prices.

"There is a huge competitive edge manufacturing in India gives you so I think if smart business people start offering better pricing, better value for money, I am sure the market will give them a boost. It is for them to decide whether they want to sit on high margins," Goyal said.

Multiple FMCG (fast-moving consumer goods) companies have alluded to a slowdown in demand, particularly in urban markets, which is reflected in their September quarter earnings performance as well.

Companies like Dabur and Nestlé India reported a decline in volumes on a year-on-year basis. Even paint companies like Asia Paints reported their first volume decline in a decade, excluding the COVID-19 pandemic period.

"I am one of those who believes that economies of scale, that the huge demand that 1.4 billion Indians provide, the demand that our growing economy, our growing income levels offers, is unmatched and the affordability, the competitive edge that this economy of scale gives you, will help you not only meet India's need but also international demand," the Commerce & Industries Minister said.

Goyal alluded to all businesses, saying that they can capture much bigger markets, and get better profits if they become more competitive in their pricing.

The minister also had a word of advice for investors to look at the long-term picture and not panic about every quarterly result.

Multiple Nifty companies, from Bajaj Auto to Tata Consumer Products, IndusInd Bank and even Tata Consumer Products saw extreme earnings reactions on missing Street expectations during the recently concluded September quarter.

"At least we in government don't work on a quarter se quarter tak (Quarter to Quarter) philosophy. I think it's time investors also looked at the long term and not panic on every quarter," Goyal said.