Consumer goods in modern trade record strong growth momentum over 3 years

By Sparkwinn Research

Sparkwinn Research conducted an analysis of publicly available financial data from 16 listed fast-moving consumer goods (FMCG) companies and four major chain supermarkets operating in Sri Lanka. 

By closely examining the segmental reporting and revenue breakdowns within the consumer goods and retail segments, we explored on the emerging macro trends in consumption patterns and evolving consumer behaviour. 

This article highlights three main findings and discusses their implications for brands.

Modern supermarkets continue their upward growth trajectory

Over the last 12 quarters, the modern trade sector has demonstrated strong and consistent revenue growth. The financial data indicates that the supermarket revenues have climbed from approximately Rs.79.2 billion to over Rs.110 billion, marking a significant expansion in a relatively short period. 

Growth is increasing year-to-year, rising from 7 percent (2023-2024) to 10 percent (2024-2025), indicating a strengthening market and higher consumer spending in 
modern trade channels.

Listed FMCG companies continue to record gradual growth

The FMCG sector has maintained a steady upward trajectory over the past three years, reflecting gradual recovery in consumer demand and improving market conditions since the economic crisis. Total turnover increased from Rs.282 billion in 2023 to Rs.319 billion in 2025, representing an overall revenue expansion of approximately 13 percent over the period.

The growth momentum has also strengthened year-on-year. The sector growth accelerated from 5 percent in 2024 to 7 percent in 2025, indicating a gradual improvement in consumption patterns and purchasing confidence. 

This acceleration is notable, given the impact of the Cyclone Ditwa-related restrictions on consumer spending, which had the potential to dampen demand in certain product categories.

The resilience of the sector suggests that the essential goods demand remains relatively stable, while companies have also adapted through pricing strategies, product mix adjustments and distribution expansion. 

Modern trade is growing faster than FMCG supply 

Modern trade supermarkets have demonstrated relatively stronger growth compared with the combined performance of the 16 listed FMCG companies. This suggests that the modern trade channel in Sri Lanka is expanding at a faster pace and holds greater structural growth potential within 
the retail landscape. 

The trend also indicates a gradual shift in consumer purchasing behaviour, with more customers moving from traditional trade outlets to organised retail formats such as supermarkets. In addition, the consumers appear to be spending larger basket values within the modern trade channels, reflecting the growing preference for convenience, wider product choice, price transparency and promotional offerings compared with the traditional neighbourhood grocery stores.

Top 3 recommendations to brands 

Sparkwinn Research Director Suthaharan Perampalam emphasises that as the consumers increasingly migrate from traditional retail outlets to organised supermarket formats, the brands must recognise modern trade (Supermarket + SMMT) as a critical and rapidly expanding growth channel within the retail ecosystem. 

First, the brands should significantly strengthen their modern trade strategy by prioritising shelf visibility, securing stronger in-store presence and investing in impactful activations and promotions to capture consumer attention directly at the point of purchase.

Second, the highly competitive nature of the supermarket shelves requires the brands to sharpen their focus on differentiation and value creation. This can be achieved through stronger packaging visibility, competitive pricing strategies and the introduction of promotional bundles, multipacks or exclusive pack sizes specifically designed for modern trade environments, where the consumers actively compare multiple brands before making purchase decisions.

Third, the brands should increasingly adopt a data-driven approach by leveraging retail insights and shopper behaviour analytics. These insights can help optimise market positioning, refine product assortment, improve pricing and promotional strategies and support more effective category management partnerships with retail chains. 

Collectively, these strategic actions will enable the brands to capture greater shelf share, strengthen consumer relevance and fully capitalise on the accelerating growth of modern trade among Sri Lankan consumers.