Assignment on HUL Ltd

7/29/2019 Assignment on HUL Ltd

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INTRODUCTION

Hindustan Unilever Limited (abbreviated to HUL), formerly Hindustan Lever Limited, is

INDIAs largest consumer products company and was formed in 1933 as Lever Brothers India

Limited. It is currently headquartered in Mumbai, India and its 41,000 employees are headed by

Harish Manwani, the non-executive chairman of the board. HUL is the market leader in Indian

products such as tea, soaps, detergents, as its products have become daily household name in

India. The Anglo-Dutch company Unilever owns a majority stake in Hindustan Unilever

Limited.

The company was renamed in late June 2007 as "Hindustan Unilever Limited".

PRODUCT LINE

(A) HOME AND PERSONAL CARE:

(1) Personal wash : Lux, Breeze, Lifebuoy, Dove, Liril, Pears, Hamam, Rexona

(2) Laundry: Surf Excel, Rin, Wheel

(3) Skin Care: Fair and lovely, Ponds, Aviance

(4) Hair care : Sunsilk naturals, Clinic

(5) Dental care: Pepsodent, Close up

(6) Deodorants : Axe, Rexona

(7)Colour Cosmetics :Lakme

(8)Ayurvedic Personal and health care: Ayush

(B) FOODS

(1) Tea : Brooke Bond, Lipton

(2) Coffee : Brooke Bond Bru

(3) Foods : Kissan, Annapurna, Knorr

(4) Ice cream : Kwality Wall's

(C) WATER PURIFIER : Pureit
http://hul.co.in/brands/kissan.asphttp://hul.co.in/brands/annapurna.asphttp://hul.co.in/brands/knorr.asphttp://hul.co.in/brands/kwality_walls.asphttp://hul.co.in/brands/kwality_walls.asphttp://hul.co.in/brands/knorr.asphttp://hul.co.in/brands/annapurna.asphttp://hul.co.in/brands/kissan.asp


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COMPETITORS ANALYSIS

According to the market survey done by BUSINESS TODAY the top 10 companies of FMCG

sector are given below.

1. Hindustan Unilever Ltd.

2. ITC (Indian Tobacco Company)

3. Nestl India

4. GCMMF (AMUL)

5. Dabur India

6. Asian Paints (India)

7. Cadbury India

8. Britannia Industries

9. Procter & Gamble Hygiene and Health Care10. Marico Industries

Market Share

Market Shares of Soap60%. Market Shares of Food Brands70%. Market Shares of Oral Products36%. Market Shares of Household Cares62%. Market Shares of Personal wash60%. Market Shares of Skin Care53%.As mentioned in the above graph, HUL is enjoying the leader position in the market and is

having highest market shares which are followed by the market challengers like Dabur India

Ltd, Nestle India Ltd, and ITC LTD, ETC..In different categories of FMCG productslikeshampoo, skincare , deo, jams, coffee, etc.

In the below pie chart we see the position of various FMCG companies doing business in

India. We can see that HUL is enjoying the position of market leader and is followed by ITC

as close second in the market share of FMCG products.


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DATA ANALYSIS:

We have the sales and profit figures of HUL from the year 1999 to 2009 in the 10year past data

from Yr1999-2009, after plotting two graph one of sales & other of profit as shown in here we

can see that both profit and sales of the company rose from the year 1999 till 2001, but in the

year 2002 we see that the sales fell but there was actually rise in the profit of the company . In

the year 2004 we see that there was a steep fall in the profit of the company and from the year2005 onwards there was a slow but steady rise in the profit of the company, but a rapid rise in the

sales of the company in the given years.

Reason for the steep fall in the profit of the company in the year 2004:-

The FMCG market in Urban India was attaining the saturation level and so companies had to

expand its market in rural India. This resulted in the downfall in the profit of HUL. There was

very aggressive advertising campaign by ITC in that year to set itself in the market this affected

HUL who was enjoying the position of market leader and resulted in the fall in the profit of the

company.

In the following graph we can see thepercentage growth in FMCG sales of HUL from March

quarter 07 to March quarter 08.

HUL

34%

ITC

29%

NESTLE

8%

BRITANNIA

6%

DABUR

4%

OTHERS

19%

MARKET SHARE OF FMCG COMPANIES IN

INDIA


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Marketing Strategies

Marketing Strategies for Urban Areas

Focuses on short supply chain for distribution. Meet every need of people everywhere. Build segments & market for the future wise Unilever has strong expertise. Emphasis on Direct selling, Franchisee to reach everyone .Marketing Strategies for Rural Areas

For long term benefit HUL started PROJECT STREAMLINE in 1997. Appointed 6000 substockists that directly covers about 50000 villages & 250million

customers.

Integrate, economic, environment, & social objective with Business Agenda.

Promotion Strategy

Project Shakti :- This project was started for Cos promotion in rural market as well aswomen empowerment. HUL's partnership with Self Help Groups of rural women. It was

started in 2001, Project Shakti has already been extended to about 50,000 villages in 12

states - Andhra Pradesh, Karnataka, Gujarat and others.

Hindustan Unilever Network (HUN) :- It is the company's arm in the Direct Sellingchannel. It presents a range of customised offerings in Home & Personal Care and Foods.

Lifebuoy Swasthya Chetana :- The programe endeavours to induce adoption of hygienicpractices among rural Indians and aims to bring down the incidence ofdiarrhoea.

Out-of-Home :- This deals in providing vending machines for hot beverages like tea andcoffee. HULs alliance with Pepsi Co. has significantly strengthened the channel.

Health and Beauty services :- (i) Lakme Salons provide specialised beauty services andsolutions, under the recognised authority of the Lakme brand. (ii) The Ayush Therapy

Centres provide easy access to authentic Ayurvedic treatments and products.


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BCG Matrix of HUL

Relative Market share

(Cash Generation)HIGH LOW

The alternative to vertical integration include:

Tapered Integration: Make and Buy

Tapered integration represents a mixture of vertical integration and market exchange. A

manufacturer might produce some quantity of an input itself and purchase the remaining portion

from independent firms. It might sell some of its product through an in-house sales force and rely

on an independent manufacturers' representative to sell the rest.

Advantages:

1. It expands the firm's input and / or output channels without requiring substantial capital

outlays.

2. The firm can use information about the cost and profitability of its inter channels to help

negotiate contracts with independent channels.

Disadvantages:

1. Forced to share production, both the internal and external channel might not achieve sufficient

scale to produce efficiently. Shared production may lead to coordination problems if the two

STAR

LUX

SUNSILK

SURF EXCEL

FAIR & LOVELY

QUESTION MARK

RIN

PEPSODENT

DOMEX

CASH COW

AXE

Vaseline petroleum jelly

DOG

WHEEL


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production units must agree on product specifications and delivery times.

2. A firm's monitoring problems may be exacerbated. For example, the firm may mistakenly the

performance of an inefficient internal supplier as the standard to be met by external suppliers.

SWOT

A research method which includes to consider about Strength, Weakness, Opportunity andthreats use for to know about company internal and external factors which could be have good or

bad impacts on company planning and then organisation can plan its strategy how to tackle with

those factors.

Strength

Internal attributes of the organisation that are helpful to achieve the objective.

Company operates around 100 countriesUnilever operates its operations nearly 100 countries in the world. And they also have270 manufacturing sites worldwide.

Strong portfolio of brandsCompany has 400 brands all around the world. Most of the brands known as

multinational brands but some of them operate in some countries and company calls itlocal brands. 13 international brands have contribution in sales more than 1 billion Euros.

And Unilever top 25 brands account for more than 70% of sales.

Products of the companyo Personal wash: Lux, Rexona/Sure,o Laundry: Surf, OMO, Persil,o Skin care: Dove, Ponds,o Hair care: Sunsilk,o Oral care: CloseUp, Pepsodent,o Deodorants: AXE, Lynx,o Food and beverages: Lipton, PG Tips,

Weakness

Internal attributes of the organisation that are harmful to achieving the objective.

Strong competitorsUnilever has strong competition worldwide by multinational. E.g. P&G, Kraft, Nestle, etc

Substitute products


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Unilever operates in 100 countries there are lots of substitute products available in the

local market. And company charge higher prices for its products but the local productsare much cheaper.

Opportunity

Changing life stylesNow people are more aware about innovations because of the media. Company can use

changing life style and increase the demand of the products.

Move operations to undeveloped countriesCompany needs to focus to move their production operations in undeveloped countries.

Than they can find cheap labour and save money on operations and they can build a

supply chain towards expensive markets. Then their profitability will be high.

Threat

External conditions which could do damage to the business's performance.

Economic downturnBiggest threat now days are recession. Most of the companies shut their operations or

make redundancies people losing their purchasing power. It has affect all over the world

in this situation coming times will be very crucial for company.

PESTLE

PEST is macro environmental scanning tool which is very helpful to scan environment. But the

model has been recently extended furthermore now it calls PESTLE analysis which provides

more efficiency towards scan the environment for future strategic planning.

PESTLE stands for Political, Economical, Socioculturel, Technological, Legal, and

Environmental, and it is very useful tool for develop new planning.

Political/Legal

Political and legal factors have huge impact on the business for develop new strategies. Thesefactors can affect, how company operates, its costs, and the demand for its products. It includes:

Political stability TAX Regulation Trade Regulation Employment Laws Environment Laws


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Health and safety laws Employment laws Consumer laws

Economical

Economic factor has major impact on how business operate and make decisions in the future.

This includes:

Economic Downturn Interest rates Exchange rate Inflation rate

Socioculturel

Social factors include the cultural aspects and its influences vary region to region. This includes:

Life style Age Religion Education

Technological

Technology is necessary for the success for competitive advantage and is provide power to

globalisation. This includes:

R&D Activity Informational Technology New machines

Environmental

Growing awareness about climate change is affecting companies very hardly and it can be create

new markets or destroy existing markets. It includes:

Climate change

Diseases Weather

Documents

Assignment on HUL Ltd