Hershey India quit non-metro general trade to chase six cities' premium shoppers
Against every Indian FMCG rival's playbook, Hershey India is exiting non-metro kirana trade to bet on six metros, quick commerce and e-commerce.
What was changed
At a July 2026 town hall, Hershey India told employees it will pull out of general trade in non-metro markets and concentrate on the country's top six cities — a rare distribution shift in Indian FMCG, where Hindustan Unilever, ITC, Mondelez and Nestle India keep widening into smaller towns through kirana stores. Investment will go to premium urban consumers via modern trade, quick commerce, e-commerce and metro general trade, plus a revamp of select traditional-trade markets. 'We are strengthening our presence in high-potential channels,' said general manager Rahul Jain.
The reset aims to fix the economics: revenue was largely unchanged at ₹525.2 crore in the year ended March 2025 from ₹526.7 crore a year earlier, while the net loss narrowed to ₹68.6 crore from ₹82.6 crore, per regulatory filings. The growth engines are premium-adjacent — chocolate bar and quick commerce sales have doubled, and syrups, spreads and baking products keep posting strong double-digit growth.
The bet runs against the market's shape: general trade still accounts for over three-quarters of FMCG sales in India, but premium categories are increasingly driven by affluent urban shoppers on modern retail and e-commerce. India's chocolate and confectionery market is estimated at about ₹25,000 crore, with per-capita chocolate consumption around 200 grams against more than 10 kg in the UK.
Why it worked
India revenue was flat year over year while the business ran a net loss, so wider distribution wasn't paying for itself.
Premium chocolate demand concentrates in the six metros' modern, quick and digital channels, where Hershey's price point wins.
General trade beyond the metros served less affluent shoppers, away from the brand's premium positioning.
Every large FMCG rival was still pushing deeper into small towns, making metro focus a cheaper way to be distinctive.
What can be applied
Distribution depth is a cost. When the product is premium, matching rivals store-for-store in small towns buys reach without margin — the right footprint is where your price point already wins.
Aftermath
The move was confirmed by general manager Rahul Jain, who said India is among Hershey's most important growth markets globally and that the strategy centres on top metro general trade markets and a strong omni-channel presence. Regulatory filings show the starting point: flat revenue and a narrowing loss as the reset begins.