Washing powder brands in price war

Washing powder consumers now reap benefit from a price cut manufacturers have offered. This low-priced segment accounts more than 80 percent of the total market.
A rise in demand for the item and raw material price-drop on the international market in the last couple of months have made room for local makers to offer a reduced rate to the people who usually consume it more in the winter, according to industry insiders.
Currently, a pack of 200-gram washing powder of any brand is selling at Tk 10-11 and 500-gram one at Tk 24, down from Tk 12 and 28 respectively.
However, the price of one-kilogram pack in the same category remains unchanged, retailers said.
“We are happy to serve the consumers with lower price as long as raw material price is down,” said Malik Mohammed Sayeed, head of marketing of Square Toiletries, manufacturer of Chaka brand washing powder, pointing to the rise in winter demand for the item, considered a more user-friendly than laundry soap.
“This is right time for price cut as consumers is getting the benefit during this heavy consumption period, ” Sayeed added.
Retail stores operators observed the price reduction have contributed to a rise in demand for outlets.
They said Unilever that leads the market with its Wheel brand, was the pioneer in cutting down the price in its lemon category, followed by three local manufacturers in the category -- Square Toiletries Ltd, Kohinoor Chemical and Keya Cosmetics.
However, some washing powder making firms see consumers' response to the price cut as lukewarm.
“We are yet to see any notable impact on sales after the price cut. Consumer reaction is not that much high to propel sales,” Golam Kibria Sarkar, assistant vice president (Brand) of Kohinoor Chemical, marketer of Tibet brand.
But, according to some retail stores operators, the decline in price has led to a rise in demand for certain brands.
“We have seen a rise in demand for washing powder as a whole following the discounts offered by manufacturers,” said AR Yahia, senior executive, public relations of ACI Logistics that runs 59 retail outlets under the brand Shwapno.
Led by multinational fast moving consumer goods maker Unilever, the washing powder market, insiders say, is expected to touch the Tk 800 crore mark in 2009 from over Tk 700 crore a year ago.
Kohinoor's official Kibria said the low price is now benefiting consumers, but noted that such opportunity might cease in the months ahead as raw materials price was picking up.
“Raw material price is rising slowly as the global economy shows the signs of recovery from recession,” he said.
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