China’s FMCG market logs 1.3% growth in Q3 on more O2O purchases

Lower-tier cities factored in about 80% in the market expansion in 2025.

China’s fast-moving consumer goods (FMCG) market stabilised in 2025, with goods spending rising 1.3% year-to-date (YTD) in Q3 2025.

Volume grew by 3.8% and average selling price dipped to 2.4%, according to a joint report from Bain & Company and Worldpanel.

Online-to-offline (O2O) channels accelerated purchase frequency and category range, while small retailers and flash delivery O2O platforms enabled brands to expand to more consumers efficiently.

Tier 3-5 cities accounted for most of the FMCG market expansion for the year as volumes rose to 4-6% while prices declined by 2-3%. Growth in these cities was due to ongoing urbanization, local consumption, and further infiltration of retailers and FMCG brands.

Packaged food led the sales value growth in Q1 to Q3 of 2025 at 3.4%, home care followed at 3.3%, and personal care at 1.1%, while beverages decreased by 1.1% due to competition and substitution by freshly made drinks.

Membership-based retailers, snack-collection chains, and discount formats have quickly expanded, growing 40%, 51% and 92% year-on-year respectively, according to the report. This highlights the consumers’ focus on value, convenience, and experience.

Social and value-driven platforms also continue to gain share as short-video and low-price commerce models factor in more than 40% of total FMCG e-commerce sales.

Private-label products soared to 44% in two years as retailers are swiftly expanding their private-label portfolios, where they use first-hand shopper insights and merge supply chains to deliver high-value alternatives.