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  • 7/29/2019 Strategy Marketing




    Hindustan Unilever Limited (HUL) formerly Hindustan Lever Limited (it was renamed

    in late June 2007 as HUL) is India's largest Fast Moving Consumer Good company,

    touching the lives of two out of three Indians with over 20 distinct categories in Home &

    Personal Care Products and Foods & Beverages.

    These products endow the company with a scale of combined volumes of about 4

    million tones and sales of nearly Rs.13718 crores touching the lives of two out of three

    Indians with over 20 distinct categories in Home & Personal Care Products and Foods &

    Beverages. The companys Turnover is Rs. 20, 239 crores (for the 15 month period

    January 1, 2008 to March 31, 2009).

    HUL is also one of the country's largest exporters; it has been recognized as a Golden

    Super Star Trading House by the Government of India. The mission that inspires HUL's

    over 15,000 employees, including over 1,300 managers, is to "add vitality to life." HUL

    meets every day needs for nutrition, hygiene, and personal care with brands that help

    people feel good, look good and get more out of life. It is a mission HUL shares with its

    parent company, Unilever, which holds 52.10% of the equity. The rest of the

    shareholding is distributed among 360,675 individual shareholders and financial



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    Hindustan Unilever Limited (HUL) (BSE: 500696) is India's largest consumer goods

    company based in Mumbai, Maharashtra. It is owned by the British-Dutch company

    Unileverwhich controls 52% majority stake in HUL. Its products include foods,

    beverages, cleaning agents and personal care products.

    HUL was formed in 1933 as Lever Brothers India Limited and came into being in 1956

    as Hindustan Lever Limited through a merger ofLever Brothers, Hindustan Vanaspati

    Mfg. Co. Ltd. and United Traders Ltd. It is headquartered in Mumbai, India and has

    employee strength of over 16,500 employees and contributes to indirect employment of

    over 65,000 people. The company was renamed in June 2007 as Hindustan Unilever


    Lever Brothers started its actual operations in India in the summer of 1888, when crates

    full of Sunlight soap bars, embossed with the words "Made in England by Lever

    Brothers" were shipped to the Kolkata harbour and it began an era of marketing branded

    Fast Moving Consumer Goods (FMCG).

    Hindustan Unilever's distribution covers over 2 million retail outlets across India directly

    and its products are available in over 6.4 million outlets in the country. As per Nielsen

    market research data, two out of three Indians use HUL products.

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    HUL is the market leader in Indian consumer products with presence in over 20

    consumer categories such as soaps, tea, detergents and shampoos amongst others

    with over 700 million Indian consumers using its products. Eighteen of HULs

    brands featured in theACNielsenBrand Equity list of 100 Most Trusted Brands

    Annual Survey (2012).

    The company has a distribution channel of 6.3 million outlets and owns 35 major Indian

    brands. Its brands include:

    Food brands:

    Annapurna salt and atta

    Bru coffee

    Brooke Bond (3 Roses, Taj Mahal, Taaza, Red Label) tea

    Kissan squashes, ketchups, juices and jams

    Lipton tea

    Knorrsoups & meal makers and soupy noodles

    Kwality Wall's frozen dessert

    Modern Bread, ready to eat chapattis and other bakery items

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    Homecare Brands

    ActiveWheel detergent

    CifCream Cleaner

    Comfort fabric softeners

    Domex disinfectant/toilet cleaner

    Rin detergents and bleach

    Sunlight detergent and colour care

    Surf Excel detergent and gentle wash

    Vim dishwash

    Magic Water Saver

    Personal Care Brands:

    Aviance Beauty Solutions

    Axe deodorant and aftershaving lotion and soap

    LEVER Ayush Therapy ayurvedic health care and personal care products

    Breeze beauty soap

    Clear anti-dandruff hair products

    Clinic Plus shampoo and oil

    Close Up toothpaste

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    Dove skin cleansing & hair care range: bar, lotions, creams and anti-perspirant


    Denim shaving products

    Fair & Lovely skin-lightening products


    Lakm beauty products and salons

    Lifebuoy soaps and handwash range

    Liril 2000 soap

    Lux soap, body wash and deodorant

    Pears soap

    Pepsodent toothpaste

    Pond'stalcs and creams

    Rexona soap


    Sure anti-perspirant

    Vaseline petroleum jelly, skin care lotions


    Water Purifier Brand:

    Pureit Water Purifier

  • 7/29/2019 Strategy Marketing



    Hindustan Unilever Ltd

    Type Public

    Traded as BSE:500696

    BSE SENSEX Constituent

    Industry Consumer goods

    Founded 1932

    Headquarters Mumbai, Maharashtra,India

    Key people Harish Manwani (Chairman),Nitin Paranjpe(CEO

    and MD)

    Products Foods, beverages,cleaning agents and personal

    care products

    Revenue 22,116crore(US$4.03 billion)(2011-2012)[1]

    Net income 2,691crore (US$489.76 million)(2011-2012)

    Employees 16,500 (2011)

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    Parent UnileverPlc (52%)




    Unilevers mission is to add vitality of life. They meet every day needs for nutrition,

    hygiene, and personal care with brands that help people feel good, look good and get

    more out of life. Our mission Enthused with Vitality.

    Vitality is at the heart of everything we do. It's in our brands, our people and our values.

    Vitality means different things to different people. Some see it as energy, others view it

    more broadly as a healthy state of body and mind of feeling alive. Whatever their

    personal definition, millions of people around the world use our productsdaily to

    add Vitality to their lives - whether that's through feeling great because theyve got shiny

    hair and a brilliant smile, keeping their homes fresh and clean, or by enjoying a great cup

    of tea, satisfying meal or healthy snack. Ever since the 19th Century when William

    Hesketh Lever stated that the companys mission was "to make cleanliness common

    place; to lessen work for women; to foster health and contribute to personal

    attractiveness, that life may be more enjoyable and rewarding for the people who use our

    products," Vitality has been at the heart of our business.

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    Vitality defines what we stand for: our values, what makes us different, and how we

    contribute to society. It's the common thread that links our brands and its central to the

    unique way we operate around the world.


    The four pillars of our vision set out the long term direction for the company where we

    want to go and how we are going to get there:

    We work to create a better future every day

    We help people feel good, look good and get more out of life with brands and

    services that are good for them and good for others.

    We will inspire people to take small everyday actions that can add up to a big

    difference for the world.

    We will develop new ways of doing business with the aim of doubling the size of our

    company while reducing our environmental impact.

    We've always believed in the power of our brands to improve the quality of peoples

    lives and in doing the right thing. As our business grows, so do our responsibilities. We

    recognize that global challenges such as climate change concern us all. Considering the

    wider impact of our actions is embedded in our values and is a fundamental part of who

    we are.


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    Product distribution (or place) is one of the four elements of the marketing mix.

    Distribution is the process of making a product or service available for use or

    consumption by a consumer or business user, using direct means, or using indirect

    means with intermediaries.

    The other three parts of the marketing mix areproduct,pricing, andpromotion.

    Thepath through which goods and servicestravel from the vendorto

    theconsumerorpayments for thoseproducts travel from the consumer to the vendor.

    Adistributionchannel can be as short as a directtransactionfrom the vendor to the

    consumer, or may include several interconnected intermediaries along the way such

    as wholesalers, distributers, agents andretailers.

    Each intermediary receives the item at onepricingpoint and movies it to the next higher

    pricing point until it reaches the finalbuyer. Coffee does not reach the consumer

    beforefirst going througha channel involving

    thefarmer,exporter,importer, distributorand the retailer. Also called the channel of


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    Channels and Intermediaries

    Distribution of products takes place by means of channels. Channels are sets of

    interdependent organisations (called intermediaries) involved in making the product

    available for consumption. Merchants are intermediaries that buy and resell products.

    Agents and brokers are intermediaries that act on behalf of the producer but do not take

    title to the products.

    Channel Design

    A firm can design any number of channels. Channels are classified by the number of

    intermediaries between producer and consumer. A level zero channel has no

    intermediaries. This is typical of direct marketing. A level one channel has a single

    intermediary. This flow is typically from manufacturer to retailer to consumer.

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    To meet the ever-changing needs of the consumer, HUL has set up a

    distribution network that ensures availability of all their products, in all

    out lets , a t all i tems. This inc lud es , main tain ing fav ora ble t rad e

    r e l a t i ons , p r ov i d i ng , i nnova t i ve i ncen t i ves t o r e t a i l e r s and

    or gan i z i ng demand gener a t i on ac t i v i t i e s among hos t o f o t he r t h i ngs .

    It has followed a strategy of building its distribution channels in a

    transitional manner; an d in d iff e r en t s ucces s i ve phas es o f the

    evo l u t i on o f i ts di str ibu tio n sys te m, ha s penetrated well into the rural


    Phase I

    The first phase of its distribution network had wholesalers placing

    bu lk order s direc tlywith the company . Large re ta il er s al so place di rect

    orders, which comprised almost 30 percent of the total orders collected.Th e

    company s a l e s man g r ouped a l l t hes e o r de r s and p l aced an i nden t

    with the HeadOffice. Goods were sent to these markets, with the company

    salesman as the consignee.The salesman then collected and distributed the

    produc ts to the re spec tive wholesa le rs , agains t cash payment, and the

    money was remitted to the company.


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    Phase II

    The focus of the second phase, which spanned the decades of the 40s, was to

    providedes ired products and qua li ty se rv ice to the company s cus tomers . In

    order to achieve this,one wholesaler in each market was appointed as a

    Registered Wholesaler, a stock pointfor the companys products in that

    market. The company salesman still covered themarket, canvassing for

    orders from the rest of the trade. He would then distribute stocks from the

    Registered Wholesaler through distribution units maintained by the

    company.The Registered Wholesaler was given a margin of 1 per cent to

    cover the cost ofwarehousing and financing the stocks held by him. The

    Registered Wholesaler system,therefore, increased the distribution reach of

    the company to a larger number ofcustomers.

    Phase III

    The highlight of the third phase was the concept of

    Redistribution Stockiest (RS) whore placed the Registered Wholesalers. The

    Redistribution Stockist was required to provide the distribution units to the

    company salesman. The Redistribution Stockist financed hiss tocks and

    provided warehous ing faci li ti es to store them.


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    The Redistribution Stockist also undertook demand stimulation activities on

    beha lf of the company . The second char ac teristic of th is per iod was the

    changes brought in as the company realised that the Redistribution Stockist

    would be able to provide customer service only if he was serviced well. This

    knowledge led to the establishment of the Company Depots system.

    This system helped in transshipment, bulk breaking, and acted as a

    stock point to minimise stock-outs at the Redistribution Stockist level.In the

    recent past, .significant change has been the replacement of the Company

    Depot bya system of third party; the Carrying and Forwarding Agents

    (C&FAs). The C&FAs actas buffer stock-points to ensure that stock-outs did

    not take place. The C&FA system hasalso resulted in cost savings in terms of

    direct transportation and reduced time lag indelivery. The most important

    bene fi t has been impr oved cus tomer service to theRedis tribution Stock is t.


    An IT-powered system has been implemented to supply stocks to

    redistribution stockists on a continuous replenishment basis. The objective is

    to catalyze HULs growth by ensuring that the right product is available at

    the right place in right quantities, in the most cost-effective manner.


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    For this, stockists have been connected with the com pany through an

    Internet-based network, called RSNet, for online interaction on orders,

    dispatches Information sharing and monitoring. RS Net covers about 80% of

    the company's turnover. Today, the sales system gets to know every day what

    HUL stockists have sold to almost a million outlets across the country. RS

    Ne t is pa rt of Project Leap, HUL's end- to-end supp ly chain , wh ich also

    includes a back-end system connecting suppliers, all companysites an d

    s t r e t ch i ng r i gh t up to s t ock i s t s . Power ed by t he I T too l s i t has

    im pr o ve d customer service, while ensuring superior availability and impact

    visibility at retail points.

    Rural Areas and Tier 2 Cities

    Lux has high penetration in the urban and semi urban areas. However, it has only

    19.8% penetration in the rural areas. The rural market has great untapped potential,

    which is notconcentrated on till now. Consumers are becoming more and more aware

    and undergoinga surge in disposable income. This huge opportunity can be

    explored by Lux. It alreadyhas a strong distribution channel in almost all regions.

    What is needed here is a change inthe communica tion strategy to reach out to the

    rural cus tomers . The var ious channel s o f communication should be made more

    appealing to this rural segment of customers.Over the past two decades, the

    company has built a remarkable distribution system thatmoves its soaps to

    every corner of India.


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    Now it has started to leverage tha t valuable infrastructure to expand its reach to a

    huge and overlooked group of consumers: the

    rural poor.For rura l In dia , H UL h as e s tab l ish ed a s i ngle dis t r ib ut io n c

    hanne l by cons o l i da t i ngcategories. In a significant move, with long-term benefits,

    HUL has mounted an initiative,Project Streamline, to further increase its rural reach with

    the help of rural sub-stockists.As a result, the distribution network directly covers about

    50,000 villages, reaching about250 million consumers.



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    1. Manufacturer _ Customer:

    This is also known as direct selling because no Middlemen are involved. A producer

    may sell directly through his own retail stores, for example, Bata. This is the simplest

    and the shortest channel. It is fast and economical. Small producers and producers of


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    perishable commodities also sell directly to the local consumers. Big firms adopt direct

    selling in order to cut distribution cost and because 274 they have sufficient facilities to

    sell directly to the consumers. The producer or the entrepreneur himself performs all the

    marketing activities.

    2. Manufacturer _ Retailer _ Customer: This is one stage distribution channel having one

    middleman, i.e., retailer. In this channel, the producer sells to big retailers like

    departmental stores and chain stores who in turn sell to customer. This channel is

    very popular in the distribution of consumer durables such as refrigerators, T V sets,

    washing machines, typewriters, etc. This channel of distribution is very popular these

    days because of emergence of departmental stores, super markets and other big retail

    stores. The retailers purchase in large quantities from the producer and perform certain

    marketing activities in order to sell the product to the ultimate consumers.

    3. Manufacturer _ Wholesaler _ Retailer _ Customer

    : This is the traditional channel of distribution. There are two middlemen in this channel

    of distribution, namely, wholesaler and retailer. This channel is most suitable for the

    products with widely scattered market. It is used in the distribution of consumer products


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    like groceries, drugs, cosmetics, etc. It is quite suitable for small scale producers whose

    product line is narrow and who require the expert services and promotional support of


    Cutting-edge Distribution Network

    HULs distribution network is recognized as one of its key strengths -- that

    which helps reach out its products across the length and breadth of this vast

    country The need for a strong distribution network is imperative, since hul

    has to gain the visibility and has to capture the minds of Indians every here

    It has 2000+ suppliers and associates 7,000 stock list and direct coverage in

    around million retail outlets across India. To meet the ever-changing needs


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    of the consumer, hul has set up a distribution network that ensures

    availability of all their products, in all outlets, at all times. This includes,

    maintaining favorable trade relations, providing innovative incentives to

    retailers and organizing demand generation activities among a host of other

    things. It boasts of placing a product across the country in less than 72 hrs.

    The first phase of the distribution network had wholesalers placing bulk

    orders directly with the company. Large retailers also placed direct orders,

    which comprised almost 30 per cent of the total orders collected.

    Today, the goods are transferred from the factory to the company

    warehouses and are sent to the distributor from there on a daily basis. From

    the distributor, the stock reaches the market through daily sales. Typically,

    these include the salesman registering the order of a retail outlet and

    delivering the goods the next day. Recently it has changed its traditional way

    distribution and came out with a new strategy of distribution.

    Its because of the change in buying pattern of the consumer due to more

    disposable income. There are different channels of distribution like Modern

    Trade, which covers al chains of super markets , who get the

    stocks directly from the company. Wholesalers and second leg of big retail

    outlets called Super Value stores come under the surveillance of the

    distributor along with the mass retail outlets. There is also this new concept

    in the its distribution channel called Kiosk. Kiosk is a small shop that sells

    only sachet s and low pr iced i t ems (be low Rs .10/ - ) . Kiosk


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    also does not come under the surveillance of the distributor. In addition

    to the ongoing commitment to the traditional grocery trade, it is building a

    special relationship with the small but fast emerging modern trade. Its scale

    enables it to provide superior customer service including daily

    servicing, improving their range availability whilst reducing inventories. It

    is using the opportunity of interfacing more

    directly with consumers in this retail

    environment through specially designed communication and promotions.

    This is building traffic into the stores while yielding high growth for the

    busines s.



    The strategy of distribution should take into account the purchasing habit of

    the rural people. While consumables are purchased in the village shop or

    Shandies or in bigger villages, the consumer durables are purchased only in

    Mandi centers, large towns or nearby cities. Hence the distribution center

    has to take the purchasing habit of the rural people into account, so that


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    product may be available at the appropriate location. In villages beyond the

    reach of the distribution system, the shopkeepers make their own

    arrangement for the procurement. Most of them commute to the nearby town

    to get the supply. But the expenses incurred resulted in the village

    shopkeepers charging consumer more than the maximum retail price.

    Generally, the village shopkeeper invest their fund sin purchases and rarely

    ever get credit facilities, which if available is made available for very short

    duration only. Since the quantum of purchase by the village shopkeeper is

    verysmall, the margins are also very meager. The ultimate consumer product

    reflects the lack of distribution network.

    Distribution Strategies in Rural Market

    1. Coverage of Villages:

    With improved communication facilities, it is possible to

    reach distribution van to the villages. The frequency ofvisits may be fixed,

    depending upon the off- takes or sales realization, so that the distribution

    cost can be minimized, but not at the cost of cutting down or rural

    popu la tion . These dis tribution cabs can be us ed fo r pr omot ion works al so .

    For villages with very less population, the distribution can be left to the

    initiative of the shop keepers and deal ers in larger villages and to the

    shopkeepers ofthe small villages. The distribution arrangement requires


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    serious consideration by manufacturing andmarketing men, if they have to

    exploit the potential of the rural market

    2. Use of Cooperative:

    Over three lakh cooperative society operate in the rural are as for or

    different purposes like, marketing cooperatives, dairy corporative, farmer

    service corporative societies, consumer corporative and other multi purpose

    corporative. Given the number ofsuch societies, there is at least one

    corporative society of one form or another for every two or three villages.

    These societies are linked to higher level of society like taluk, district, or

    state level. Thus these corporative have an arrangement for centralized

    procurement and dis tr ibut ion through thei r respect ive sta te level feder at ion.

    Such state level federation cans be motivated to procure and distribute

    consumables items and low level durablesitems to the member societies for

    selling to the rural consumers

    3.Utilization ofPublic Distribution System:

    The Public Distribution System(PDS) in the country is fairly well organized.

    The revamped PDS places more emphasis on reaching remote rural areas

    like hills and tribal areas. Effective utilization ofthe PDS system

    should be explored by the manufacturing and marketing men, since they

    already have a distribution set up.

    4. Distribution to Feeder Markets / Mandi Towns:


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    The villagers visit these to what regular intervals not only for selling the

    agricultural produce but also for the purchase of cloth, jewellery , hardware,

    radios, torch cells and other durables and consumer product. Lux has

    established a good distribution network in theidentified feeder market and

    mandi towns. From the feeder market and manditown, the stockiest or

    wholesaler arranges for distribution to the village shop in theinterior places.

    Comparative analysis Rural:

    Fo r r u r a l I nd i a , HUL has e s t ab l i s hed a s i ng l e d i s t r i bu t i on channe l

    by cons o l id a t i ng ca tegor ie s. In a signif icant move , with long- term

    benefi ts , HUL has mounted an in it ia tive, Project Streamline, to furthe r

    increase its rural reach with the help of rural sub-stock lists. As a result, the

    distribution network directly covers about 50,000 villages, reaching about

    250 million consumers. Consolidation has to be done in the rural setup as the

    road and transport facilities are not very good hence one channel is used.

    Urban An IT-powered system has been implemented to supply stocks to

    redis tr ibut ion s tock li sts on a con t inu ous rep leni shme nt bas is . The

    obje ct iv e i s t o c ata lyze HUL s g row th b y ensur ing that the r ight

    produc t is avai lable at the righ t place in right quan ti ties, in the most cost -


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    effective manner. For this, stock lists have been connected with the company

    through an Internet-based network, called RSNet, for online interaction on

    orders, dispatches, information sharing and monitoring. RS Net covers

    about 80% of the company's turnover. In the urban setup there is no

    consolidation as there is fast communication and available transport and

    road facilities.




    Hindustan Unilever Ltd (HUL), the countrys largest household and personal care

    products maker by sales, is expanding its so-called go to market (GTM) initiative,

    launched in Mumbai last year, in an attempt to revamp its national distribution network

    and streamline its supply chain.

    The project has been a success in Mumbai, where it was started in June, and will be

    rolled out in 42 cities and towns across India by the end of 2009, Hemant Bakshi,


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    executive director for sales and customer development at HUL, told Mint in an


    Leveraging strengths: Hindustan Unilevers Hemant Bakshi.

    The Mumbai pilot is now complete and has delivered significant improvements in

    customer service. We are now in the process of rolling out the project in other towns

    with population of eight lakh-plus, Bakshi said. It is a very important project for us

    and Unilever and we will roll this out eventually in (global) markets that are at a similar

    stage of development.

    HULs GTM initiative in Mumbai was aimed at rationalizing its distribution network,

    make it more efficient, deliver stocks to retailers faster and reduce inventory on their

    product shelves. It farmed out the task of stock deliveries to logistics provider Mahindra

    Logistics as part of the Mumbai project.

    In Mumbai, the company consolidated its 21 distributors into four mega distributors,

    who now account for sales of about Rs480 crore, another senior HUL executive said.

    Bakshi said dealership reduction has been an ongoing exercise, but declined to provide

    figures about the pilot project.


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    The GTM initiative has been internally labelled by parent firm Unilever Plc. as one of its

    10 most important initiatives said the senior HUL executive, as well as an executive with

    a firm that does business with HUL. Both of them declined to be named as they were not

    authorized to comment on the companys operations.

    A top management team from Unilever, including outgoing chief executive officer

    Patrick Cescau, his successor Paul Polman, and HUL chief executive officer Nitin

    Paranjpe, are believed to have assessed the success of the pilot plan last month and given

    in-principle approval to take the project to key cities in Tamil Nadu, Karnataka, Gujarat

    and Madhya Pradesh.

    Unilever has said it is looking at global savings of 1.5 billion (Rs9,855 crore) annually

    by 2010 through the restructuring operations.

    The HUL executive and the HUL business associate added that the company is

    restructuring other aspects of its operations as part of the GTM project and that it would

    cut back on losses and in-transit theft.

    The consolidation is aimed at giving the distributors, who typically operate on a 4%

    profit margin, a bigger share of the pie at a time when they are being wooed by other


    At least a couple of our distributors are now owners of close to Rs100 crore companies,

    up from the Rs8-10 crore business they had just under an year ago, the HUL executive


    Our distribution network is changing from being one driven by entrepreneurs to

    becoming large professional distribution houses with service orientation, Bakshi said.


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    Our biggest strength in the market is our distribution network, our knowledge of the

    market and our strong brands. We now want to leverage these, ensure that our

    distributor-partners make sustainable returns and be prepared for the emerging market of


    HUL had revenues of Rs13,913.40 crore in 2007like its parent company, HUL follows

    a calendar year for declaring resultsand sells some of the countrys most recognized

    brands such as Surf Excel detergent powder, Lux soaps, Ponds and Dove skin care


    As part of its effort to streamline distribution, HUL has also started outsourcing most of

    the sales team to professional staffing firms. Traditionally, bookings from retailers was

    the responsibility of the distributors sales team.

    Distributors salesmen have generally been not very competitively paid and have no job

    security and decent working conditions. While they have traditionally been paid between

    Rs4,000-7,000, the new salesmen are graduates wherever available and are paid

    Rs7,000-11,000 and are from a staffing services company, said the HUL business

    associate, adding that HUL is now asking distributors to use their own resources to

    upgrade staff offices and training.

    Currently, about 2,400 distributors across the country employ 9,000 salesmen to take

    weekly orders from a million retail outlets.

    Enlisting Mahindra Logistics led to a system being put in place that has cut seven-day

    inventory to one day .

    Orders are logged in the evening by distributors staff and delivered by the company the

    next evening to the distributor. Mahindra Logistics delivers stocks to retailers the next


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    morning. Essentially this frees distributors resources that are otherwise tied up in

    stocking excess inventory and preventing losses due to in-transit damage. Consumers get

    fresher stock from retailers.

    The system also ensures that products that languish on a retailers shelves are not

    supplied, eliminating losses from expired stock. The shift from dependence on the

    unorganized sector to an external logistics supplier will also reduce loss due to pilferage,

    one HUL executive said

    Mahindra Logistics managing director Sanjay Sinha declined to comment.

    The GTM pilot in Mumbai, meanwhile, could make HUL distributors more visible to

    retailers because sales people are required to now visit retailers regularly instead of

    waiting for orders to come in.

    The consumer products business works on personal relationships and it helps for

    retailers to have an equation with the distributor, the HUL business associate said.

    With retailers now putting a range of global products in every segment on their shelves,

    HUL, a major player in the food, personal care and home segments, faces the threat of

    shrinking market share.

    A May report from the Federation of Indian Chambers of Commerce and industry,

    before the crash in financial markets and a global economic slowdown, projected Indias


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    household and consumer care products market to grow 16% this fiscal year to Rs95,150


    First Published: Fri, Jan 09 2009.


    The new Hindustan Lever see an exciting opportunity for growth. They have

    35 powerful brands covering all segments, with leading market positions in most.

    Today, these are stronger and more relevant to the consumer than ever.

    The people are energized by the scale of the opportunity and determined to seize



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    The scale of the business and operations gives them the resources needed.

    They are delivering good services and the changes they brought in the products

    are welltaken by the customers, by this they are generating sustainable profitable


    Distribution channel of hul is systematic.

    Hul is giving a good priority towards its distribution channel.

    Hul sees that retailer as weel as consumer get proper benefits.

    Hul believes proper channel of distribution gives an impact on the company. It

    affects its growth. If the channel is not properly managed then the company may

    face loss in profit.

    Hul tries that to full fill the requirement of the people involves in distribution


    Distribution channel is an integral part of an organization.


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    Hul is giving more importants to its channel

    Hul has well organized channel of distribution.


    HUL works to create a better future every day and helps people feel good,

    look good and get more out of life with brands and services that are good for

    them and good for others.

    With over 35 brands spanning 20 distinct categories such as soaps,

    detergents, shampoos, skin care, toothpastes, deodorants, cosmetics, tea,

    coffee, packaged foods, ice cream, and water purifiers, the Company is a part

    of the everyday life of millions of consumers across India. Its portfolio


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    includes leading household brands such as Lux, Lifebuoy, Surf Excel, Rin,

    Wheel, Fair & Lovely, Ponds, Vaseline, Lakm, Dove, Clinic Plus, Sunsilk,

    Pepsodent, Closeup, Axe, Brooke Bond, Bru, Knorr, Kissan, Kwality Walls

    and Pureit.

    These products are manufactured over 40 factories across India. The

    operations involve over 2,000 suppliers and associates. HUL's distribution

    network comprises about 4,000 redistribution stockists, covering 6.3 million

    retail outlets reaching the entire urban population, and about 250 million

    rural consumers.

    HUL distribution is a key strength for the company to supply their products

    to anywhere in the country. This includes, maintaining favourable trade

    relations, providing innovative incentives to retailers and

    organizing demand generation activities among a host of other things.

    Each business of HUL portfolio has customized the network to meet its

    objectives. The most obvious function of providing the logistics support is to

    get the companys product to the end customer.

    The HUL distribution network has seen a lot of evolvement over time. From

    Wholesalers placing order directly with the company, to Registered


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    Wholesalers, to Redistribution Stockist (RS), the network has grown to cover

    a major part of the Indian urban and rural population.

    In recent years, the FMCG sector declined due to down trading. Also because

    ofpresence of la rge number of companies try ing to seize th is opportuni ty ,

    this force the old HLL for the change and thus, their transformation has

    resulted in a new HLL, which has successfully faced this challenge and

    reversed this trend.

    It has done so by substantially strengthening their brands and building

    capabilities. This has already begun to yield benefits and they are returning

    to growth. Volume growth is being followed by value growth, which in turn

    is bringing profit growth. India is one of the most exciting markets offering

    great potential.

    Over the next 10 years, the per capita income in India is likely to double. In

    FMCG, there is an opportunity to catalyze penetration, increase usage, and

    upgrade consumers.

    As a result, the FMCG market is expected to grow to over Rs. 100,000 crores

    from its current base of Rs. 40,000 crores. The new Hindustan Lever sees an

    exciting opportunity for growth. They have 35 powerful brands covering all


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    segments, with leading market positions in most. Today, these are stronger

    and more relevant to the consumer than ever.

    The people are energized by the scale of the opportunity and determined to

    seize it. The scale ofthe business and operations gives them the resources

    needed. They are delivering good services and the changes they brought in

    the products are well taken by the customers, by this they are generating

    sustainable profitable growth.


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    DISTRIBUTION CHANNEL OF HUL t. Hindustan_Unilever