BUSINESS

PROJECT
HINDUSTAN UNILEVER LIMITED

Made by:
Pranshu Agarwal
First Year
BBA (D)

Introduction:
Hindustan Unilever was founded in 1888 by the introduction of Sunlight
Soaps in India the soaps had been embossed with the words Made in England
by Lever Brothers. In 1895 Lifebuoy soap was launched with agents appointed
in Mumbai, Madras(Chennai), Kolkata and Karachi. In 1931 it had set up its
first subsidy in India. In 1933 it was established in India as Lever Brothers till
1956 it became Hindustan Lever Limited. This was due to the merger
between Lever Brothers & Hindustan Vanaspati Mfg. Co. Ltd. By 1965 the
company had offered 10% of its equity in the Indian market. The company was
renamed as Hindustan Unilever Limited in 2007. Unilever now holds 67.25%
equity in the company. The rest of the shareholding is distributed among about
three lakh individual shareholders and financial institutions.

The erstwhile Brooke Bond's presence in India dates back to 1900. By 1903, the
company had launched Red Label tea in the country. In 1912, Brooke Bond &
Co. India Limited was formed. Brooke Bond joined the Unilever fold in 1984
through an international acquisition. The erstwhile Lipton's links with India
were forged in 1898. Unilever acquired Lipton in 1972, and in 1977 Lipton Tea
(India) Limited was incorporated.

Pond's (India) Limited had been present in India since 1947. It joined the
Unilever fold through an international acquisition of Chesebrough Pond's USA
in 1986.

The liberalisation of the Indian economy, started in 1991, clearly marked a

growth in HUL's curve the removal of the regulatory framework allowed the
company to explore every single product and opportunity segment, without any
constraints on production capacity.

Simultaneously, deregulation permitted alliances, acquisitions and mergers. In

one of the most visible and talked about events of India's corporate history, the
erstwhile Tata Oil Mills Company (TOMCO) merged with HUL, effective from
April 1, 1993. In 1996, HUL and yet another Tata company, Lakme Limited,
formed a 50:50 joint venture, Lakme Unilever Limited, to market Lakme's
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market-leading cosmetics and other appropriate products of both the companies.

Subsequently in 1998, Lakme Limited sold its brands to HUL and divested its
50% stake in the joint venture to the company.

HUL formed a 50:50 joint venture with the US-based Kimberly Clark
Corporation in 1994, Kimberly-Clark Lever Ltd, which markets Huggies
Diapers and Kotex Sanitary Pads.
The 1990s also witnessed a string of crucial mergers, acquisitions and alliances
on the Foods and Beverages front. In 1992, the erstwhile Brooke Bond acquired
Kothari General Foods, with significant interests in Instant Coffee. In 1993, it
acquired the Kissan business from the UB Group and the Dollops Ice-cream
business from Cadbury India.

As a measure of backward integration, Tea Estates and Doom Dooma, two

plantation companies of Unilever, were merged with Brooke Bond. Then in
1994, Brooke Bond India and Lipton India merged to form Brooke Bond Lipton
India Limited (BBLIL), enabling greater focus and ensuring synergy in the
traditional Beverages business. 1994 witnessed BBLIL launching the Wall's
range of Frozen Desserts. By the end of the year, the company entered into a
strategic alliance with the Kwality Icecream Group and in 1995 the Milk food
100% Icecream marketing and distribution rights too were acquired.

In January 2000, the government decided to award 74 per cent equity in Modern
Foods to the company, thereby beginning the divestment of government equity
in public sector undertakings (PSU) to private sector partners. The company's
entry into bread is a strategic extension of the company's wheat business. In
2002, the company acquired the government's remaining stake in Modern
Foods.

In the year 2002, the company made its foray into Ayurvedic health & beauty
centre category with the Ayush product range and Ayush Therapy Centres. In the
year 2003, the company acquired the Cooked Shrimp and Pasteurised Crabmeat
business of the Amalgam Group of Companies, a leader in value added Marine
Products exports. Also, the company launched Hindustan Unilever Network,
Direct to home business. In the year 2004, the company launched 'Pureit' water
purifier.
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In the year 2005, Lever India Exports Ltd, Lipton India Exports Ltd, Merry
weather Food Products Ltd, Toc Disinfectants Ltd and International Fisheries
Ltd were amalgamated with the company. In February 2006, Vasishti Detergents
Ltd (VDL) merged with the company. In September 2006, Modern Foods
Industries (India) Ltd and Modern Foods & Nutrition Industries Ltd was merged
with itself. In October 2006, the company divested its 51% controlling stake in
Unilever India Shared Services Ltd, now known as Capgemini Business
Services (India) Limited (CGSL) to Cap Gemini SA.

In March 2007, Sangam Direct, a non-store home delivery retail business,

operated by Unilever India Exports Ltd (UIEL), a fully owned subsidiary was
transferred to Wadhavan Foods Retail Pvt Ltd (WFRPL) on a slump sale
business. Also, the company carried out demerger of its operational facilities in
Shamnagar, Jamnagar and Janmam and formed three independent companies,
namely Shamnagar Estates Pvt. Ltd, Jamnagar Properties Pvt Ltd and Hindustan
Kwality Walls Foods Pvt Ltd. In June 2007, the company changed its name
from Hindustan Lever Ltd to Hindustan Unilever Ltd.

In the year 2008, the company announced its collaboration with the Indian
Dental Association (IDA) in conjunction with World Dental Federation (FDI)
through its Pepsodent, leading oral care brand to help improve the oral health
and hygiene standards in India. In April 2008, the company demergered and
transferred certain immoveable properties to Brooke Bond Real Estates Pvt Ltd.
In January 2010, the company inaugurated the new corporate office of the
company.

In April 2010, the company approved the scheme of amalgamation of Bon Ltd,
a wholly owned subsidiary of Hindustan Unilever Ltd., with the company. The
appointed date for the abovementioned scheme was April 01, 2009 and the
scheme shall be effective from April 28, 2010. Consequent to the amalgamation,
Bon Ltd ceased to be a subsidiary of the company.

During the year 2010-11, Kissan forayed into new market segment in three big
categories. It launched Kissan Fruit & Soya, a delicious blend fruit juice and
soya milk, which enjoys a differentiated proposition in this market. The brand
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also entered into the Indian (non-sweet) spreads market with the launch of
Kissan Creamy Spread across key towns. In Bakery division, the company
launched two new products, namely Chapi and Cream Rolls.

During the year, the company divested 43.31% stake in Hindustan Field
Services Pvt Ltd in favor of Smollan Group (The JV partner). Thus, Hindustan
Field Services Pvt. Ltd. ceased to be a subsidiary company. Lakme Lever Pvt
Ltd, a wholly owned subsidiary of HUL, expanded the network of Lakme
Beauty Salons during the year with the opening of 11 company owned and
managed salons, along with 18 franchisee salons.

As of March 31, 2011, the company had over 35 brands spanning 20 distinct
categories. Its portfolio includes household brands, such as Lux, Lifebuoy, Surf
Excel, Rin, Wheel, Fair & Lovely, Pond's, Vaseline, Lakme, Dove, Clinic Plus,
Sunsilk, Pepsodent, Closeup, Axe, Brooke Bond, Bru, Knorr, Kissan, Kwality
Wall's and Pureit.

In December 2011, the company demerged the FMCG exports business

including specific exports related manufacturing units of the company into its
wholly owned subsidiary Unilever India Exports Ltd (UIEL). The scheme
became effective from January 1, 2012.

Mission:
Unilever mission is to add Vitality to life. We meet everyday people needs for
nutrition, hygiene, personal care with brands that help people feel good, look
good and get more out of life.

Product Line:
Hindustan Unilever being Indias largest Fast Moving Consuming Company has
it presence in 20 consumer categories. It is the only company in India to have 16
brands featured in the A.C Nielsen Brand Equity list of 100 Most Trusted
Brands Annual Survey (2014), carried out by Brand Equity, a supplement of
The Economic Times.
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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 & Lovely
Ponds
Aviance
4. Hair Care:
Sunsilk Naturals
Clinic
5. Oral Care:
Pepsodent
Close up
6. Deodorants:
Axe
Rexona
7. Ayurveda Personal & Health Care:
Ayush
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8. Color Cosmetic:
Lakme
B. FOODS
1) Tea
Brooke Bond
Lipton
2) Coffee
Brooke & Bru
3) Foods
Kissan
Knor
Annapurna
4) Ice Cream
Kwality Walls
5) Water Purifier
Pureit

Distribution Network:
HULs distribution network is recognized as one of its key strengths, which
helps it to reach out with products across the length and breadth of India. The
need for a strong distribution network is imperative, since HULs corporate
purpose is to meet every needs of people everywhere. HULs products,
manufactured across the country, are distributed through a network of about
7,000 redistribution stockiest covering about one million retail outlets. The
distribution network directly covers the entire urban population. In addition to
the ongoing commitment to the traditional grocery trade, HUL is building a
special relationship with the small but fast emerging market trade. HULs scale
enables it to provide superior customer service including daily servicing,
improves their range availability, and reduces inventories.
HUL is using the opportunity of interfacing more directly with consumers in
this retail environment through specially designed communication and
promotions. This is building traffic in to the stores while yielding high growth
for the business. An IT powered system has been implemented to supply stocks
to redistribution stockiest on a continuous replenishment basis. The objective is
to catalyse HULs growth by ensuring that the right product is available at the
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right place in right quantities in the most cost effective manner. For this,
stockists have been connected with the company through an internet based
network, called RSNet, for on line interaction on orders, dispatches, and
information sharing and monitoring.
Today, the sales system gets to know what HUL stockiest have sold to almost a
million outlets across the country on the daily basis.
Indirect Coverage: Under the indirect coverage method, company vans were replaced by vans
belonging to redistribution stockiest, which serviced a select group of
neighboring markets.
Operation Harvest: The reach of conventional media and, therefore, the awareness of different
products in rural markets is weak. It was also not always feasible for the
redistribution stockiest to cover all these markets due to high cost involved. Yet,
these markets are important since growth opportunities are high. Operation
Harvest endeavored to supplement the role of conventional media in rural India
and, in the process, forge relationships and loyalty with rural consumers.
Operation Harvest also involved conducting product awareness programmers on
vans.
Cinema Van Operations: Cinema van operations are funded by the redistribution stockiest where films
and audio cassettes with song and dance sequences from popular films are
shown to consumers along with advertisements of HUL product
Single Distribution Channel: For rural India, HUL has established a single distribution channel by
consolidating categories. In a significant move, with long-term benefits, HUL
has mounted an initiative to further increase its rural reach with the help of rural
sub stockiest has already appointed 6000 sub stockiest as result, the distribution
network directly covers about 50,000 villages, reaching about 250 million
consumers.
Supplier Performance: Unilever has extensive systems in place to monitor supplier performance on a
range of issues. Typically, an operating company such as Unilever Indonesia
will conduct a full audit of all its suppliers on a rolling programme. The audit
covers quality, health, safety, environment, and labor law issues. The audit did
not include labor conditions as local laws set high standards for all companies
that are effectively enforced.

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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.
2.
3.
4.
5.
6.
7.
8.
9.
10.

Hindustan Unilever Ltd.

ITC (Indian Tobacco Company)
Nestl India
GCMMF (AMUL)
Dabur India
Asian Paints (India)
Cadbury India
Britannia Industries
Procter & Gamble Hygiene and Health Care
Marico Industries

THE COMPARATIVE DATA OF % MARKET SHARE OF HUL AND ITS

COMPETITOR IN QUARTER ENDED JUN08

80
66.9

70
59.6

58.4

60

53.4

52.7

40

38.3

36.8
30

30
20
10

46.9

46.5

50

23.9
13.3

23.2
21.2
15

9.1

8.1

12.9

7.5

5.7

HUL(MARKET SHARE %)

COMPETITOR (MARKET SHARE %)

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(Above graph showing %age Market share of HUL and its competitor in
different categories of FMCG products)
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, Patanjli.
In different categories of FMCG products like shampoo, skincare, deo, jams,
coffee, etc.

In some category these market challengers are giving high level competition in
different product lines such as ketchup and toothpaste (As shown in the graph
below).
HUL(Market share%)
COMPETITOR(Market share%)

47.9

30

27.6
24.5

T O O T H PAS T E

K E TC H U P

(Above graph showing the two category of products in which HUL percentage
market share is less than its competitor.)

So we can see that in overall FMCG business HUL is distantly ahead of rest of
the companies as far as market share of different products are concerned.

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MARKET SHARE OF FMCG COMPANIES IN INDIA

OTHERS; 19%
HUL; 35%
DABUR; 4%
BRITANNIA; 6%
NESTLE; 8%
ITC; 29%

HUL

ITC

NESTLE

BRITANNIA

DABUR

OTHERS

In the above 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

S.W.O.T ANALYSIS:
Strengths:
In house R&D center.
Variety of products.
Brand Image.
Has more than 15,000 employees.
Reach of 6.4 million retail outlet.
As a part of CSR, there are projects like Shakti, Plastic Recycling, Women
empowerment.
o Strong presence in most of the categories it is present.
o
o
o
o
o
o

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o Healthy Shareholders returns.

Weakness:
o Pricing Policy is not good.
o There is not much focus on the upper class population.
o Tough competition in the market due to this they are not able to compete in
the rural market.
o Increase in Ad spending which may affect their margins.

Opportunities:
o
o
o
o
o
o

They need to tap rural market and increase their presence in in urban market.
The per capital income of people is increasing.
India is a huge and growing market.
There is a scope to make more impact of the brand image they have.
Increase in demand by the consumer.
Modern retailing gaining coverage.

Threats:
o Intense competition in the market.
o Government policy to allow FDI in India.
o Local and cheap products produced in the rural market.

HUL POLICIES:
Corporate Social Responsibility Policies:
HULs CSR Policy is supported by the following principles:
We are committed to conducting our operations with integrity and respect, in
the interest of our stakeholders, and in line with our Code of Business
Principles.
We believe growth and environmental sustainability need not be conflicting.
Our business model is designed to deliver sustainable growth. The inputs to
the model are our brands, our people and our operations. The outputs to the
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model are sustained growth, lower environmental impact and positive social
impact. The differentiator in our business model is our USLP and the goal of
sustainable living.
We collaborate and engage with different stakeholders including
Governments, NGOs, IGOs, Suppliers, Farmers, and Distributors to tackle
the challenges faced by the society.

Quality Policy:
Principles of the Quality Policy
Putting the safety of our products and our consumers first
We have stringent mandatory quality standards in place against which
compliance is verified through regular audits and self-assessments. These
standards ensure we design, manufacture and supply products that are safe, of
excellent quality, and conform to the relevant industry and regulatory standards
in the countries in which we operate. Comprehensive management procedures
are in place to mitigate risks and to protect our consumers and markets.
Putting consumers and customers at the heart of our business
We actively engage our consumers and customers, translating their needs and
requirements into our products and services, thus creating consumer value
wherever we position our products. This is at the very heart of our innovation
process.
Quality is a shared responsibility
Quality and consumer safety is the responsibility of every Unilever employee
and Unilever demonstrates visible and consistent leadership to meet this policy.
The drive for quality, in all that we do, is a passion reflected in our brand
development, manufacturing and customer service processes and is also
expected of our business partners. We partner with stakeholders to provide
leadership, promote transparency and share best practice. And weve forged
effective working relationships with suppliers and contract manufacturers.
Building and maintaining excellent systems to ensure the quality and safety
of our products
Were proactively and continuously developing our systems and processes to
ensure quality and safety throughout the whole value chain, and were setting a
benchmark for the business. We provide appropriate training and resources, and
will ensure that we deliver our quality objectives and targets. We regularly
measure and improve our performance using both internal and external
measures.
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We actively promote our Quality Policy and have a quality assurance

organisation in place to ensure consistency and visibility of quality standards,
processes and performance indicators across all Unilever businesses at all
levels, and to anticipate and develop future quality capability requirements.

Safety Policy:
Safety Principles
HUL's Occupational Safety and Health Policy is based on and supported by
the following eight Principles.
These Principles have the same status as the Company's Code of Business
Principles:

All injuries and occupational illnesses are preventable

All operational exposures can be safeguarded
Safety evaluation of all business processes is vital
Working safely is a condition of employment
Training all employees to work safely is essential
Management audits are a must
Employee involvement is essential

Environment Policy:
Ensure safety of its products and operations for the environment by using
standards of environmental safety, which are scientifically sustainable and
commonly acceptable.
Develop, introduce and maintain environmental management systems across
the company to meet the company standards as well as statutory
requirements for environment.
Verify compliance with these standards through regular auditing.
Assess environmental impact of all its activities and set continual
improvement objectives and targets and review these periodically to ensure
that these are being met at the individual unit and corporate level.
Reduce waste, conserve energy and explore opportunities for reuse and
recycle.
Involve all employees in the implementation of this Policy and provide
appropriate training.
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 Provide for dissemination of information to employees on environmental

objectives and performance through suitable communication networks.
Encourage suppliers and co-packers to develop and employ environmentally
superior processes and ingredients and co-operate with other members of the
supply chain to improve overall environmental performance.
Work in partnership with external bodies and Government agencies to
promote environmental care, increase understanding of environmental issues
and disseminate good practices.

Pioneering new channels:

o In March 2009, they adopted Go-to-Market programme.
o Earlier it had different distributors for its different divisions. Now all the
products would be sold be one distributor in any one area.
o The Go-to-Market helps to remove the enormous logistics faced by
distributors in their operations. It helps to remove significant costs.
o Project Shakti: It is a partnership with Self Help Group of rural women.
o It is selling Home & Personal care, Foods directly on the door steps.

THANK YOU

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