The FMCG sector in Nigeria and Sub-Saharan Africa is currently grappling with notable challenges. These regions face a macroeconomic environment characterised by formidable factors such as rapidly rising inflation, high energy costs, elevated interest rates, and declining consumer purchasing power.
Additionally, FMCG businesses are also contending with the impact of technological advancements and shifting consumer preferences, all of which have significant implications for cash flow.
FMCG companies need to adjust and improve their payment collection procedures to succeed amidst these challenges.
Given the perishable nature of FMCG products, it is of utmost importance for businesses in this industry to swiftly sell their inventory to prevent wastage caused by spoiled or expired goods. Enhancing payment processes is crucial in maintaining a high turnover rate for these products.
This article will delve into five efficient methods FMCG businesses can employ to manage payment collection, enhance customer satisfaction and streamline transactions.
A McKinsey report titled ‘Future of Payments in Africa’, published in September 2022, confirmed that cash continues to dominate as the preferred payment method in Africa.
However, there are anticipated changes in consumer behaviour soon. However, until that transition occurs, FMCG businesses must recognise that cash remains a widely accepted payment option.
Therefore, FMCG businesses should be willing to accept cash payments from customers who have yet to embrace electronic and digital payment methods. FMCG businesses establish robust protocols for handling cash, including implementing secure cash registers and establishing secure storage facilities to ensure precision and minimise theft risk.