Toffee business threatened by UPI?

The trend of #UPI payments has increased since demonetisation in 2016, and it accelerated during COVID-19, Back in early 2010s, almost all big players, including Mondelēz International , Mars , Nestlé , Perfetti Van Melle , Parle Agro Pvt Ltd & ITC Limited , reported staggering growth & future prospects. As of 2020, most of these brands have reported steep declines in toffee sales.

In the days before UPI, shopkeepers immodestly traded #toffees for loose #cash, a transaction that didn't take place the other way around. As evidenced by studies, these small amounts over time did wind up turning into substantial sums of money for many buyers. As a result of UPI, this stopped, people paid exactly what was due with no room for change, which ultimately consumed the daily toffee sales.

One user on LinkedIn said, "Candies category first and chutta category came second and used by retailers as a smart tactic. However, these have special places and reasons to buy as impulse buying. Sales may be getting affected, as no more substitute for chutta. Pulse is a game changer in #HBC. Now, what's the solution? Co branding, alliances, small packs etc. Who thought Chocolates would compete with sweets? Now King Khan endorses Haldirams, Soan Papdi? It requires smart counter moves and repositioning, branding efforts? Remember, the cola competition is no longer pepsi but nimbu and nariyal pani."

Another stated, "Well, this is a topic of market research. UPI has added to the gravity of candy business, but it's not that bad, KGS and pan shops who used to have candy burnies only on their counters have now replaced them partially with sweets like barfies, gulab jamuns, gud chikkis, laddus in same bernies. And sweets have faster rotation then candies and they have high margins but low shelf life. Candy's & Chocolates can never be eliminated from the market for the love of it. And all hyper marts, #supermarkets are now selling candies in packs of 10s or so at pay and exit counters. We need to have a good placement strategy, that's it."

But the CEO of Capitalmind,  Deepak Shenoy tweeted Lotte’s annual report mentioning - “I don't really think UPI is killing the toffee business" 

UPI is killing the Indian toffee business, a topic that has been widely discussed and debated over the past few days, with industry experts opining that #digitalpayments have led to the decline of the practice of #shopkeepers handing out candy instead of loose change.

Deepak Shenoy added, the annual report says they were hurt in FY21 from schools shutting down. FY22 was bumper sales.

#Lotte India, a manufacturer of boiled candy, reported the following results:

The company is best known for its #ChocoPie, #CoffyBite, Lotte #Eclairs, and #LactoKing. Their profits rose to Rs 1150.16 lakhs as against Rs 1,004.39 lakhs in the year ending 31st March, 2021.

The shopkeepers traded loose cash for toffees before UPI, a #transaction that didn't take place the other way around. Studies have shown that small amounts over days can become large sums of money, as many buyers have accepted.

All of this stopped when UPI was introduced. The daily toffee #sales were eaten up by people paying the exact amount that was due without any scope for change.

What are your views on this?