1. PRESENTED by
:ISHANK
RICHA
SWATI

2. Introduction…..
 Hindustan Unilever Limited (‘HUL’), formerly Hindustan
Lever Limited (it was renamed in late June 2007 as
HUL).
 India's largest Fast Moving Consumer Goods company
 HUL is also one of the country's largest exporters
 The mission that inspires HUL's over 15,000 employee
s, including over 1,300 managers, is to "add vitality
to life.“
 HUL meets everyday needs for nutrition, hygiene, and
personal care with brands that help people feel good,
look good and get more out of life.

3. Food Brands
Playful banter, a Lipton has a India’s favorite Brooke Bond Taaza Brooke Bond Taj
little mischief, range of cup of tea, the lifts me people Mahal is an
serious vitality teas great taste of unshackles the exclusive selection
conversation… that truly Red Label brings mind, allowing of teas for the
there’s no time for encompass the people closer them to see and discerning
young couples like goodness of together and realize possibilities. consumer.
the time spent tea. strengthens
sharing a cup of 3 relationships.
Roses.
Partnering with the
Ek cup Bru A good With Kissan, Kissan Amaze mom in nurturing
Knorr helps
aur mood honest good food is Brainfood is her dreams,
families make
ban jae… scoop of loved not speci - fically Annapurna Atta is
meal times
daily shoved! designed for aimed at helping
special,
pleasure. the mental her provide
nutritious, tasty
development wholesome tasty
and healthy.
of kids. nutrition to her

4. Home Care Brands
Sunlight is a Cif- the best The world’s The sheer power
color care cleaner to let largest fabric of Domex bleach
brand you shine. conditioner gives you the
brand. confidence you
need, eradicating
all known germs.
Created in 1885, Active Wheel de Rin provides ‘best Giving your kids the
the Vim brand is "Mehnat se in class freedom to get dirty
still innovating and Aazadi" Freedom whiteness’ which and experience life,
using the magic of from painful & is demonstrable. safe in the
natural ingredients tiring laundry knowledge that Surf
to create Excel will remove
unbeatable results those stains
over a hundred
years later.

5. Personal Care Brands
Lux believes in passion Holistic skin care Breeze, with the goodness Awaken, and enliven your
for beauty. It continues experiences perfected over of glycerine gives soft, senses with a Liril bath.
to be a favorite with the ages to deliver healthy, fragrant and smooth skin.
generations of users for a beautiful skin
sensuous experience of
luxury.
Rexona gives you 24 Dove stands for real Pears – the purest and most Lifebuoy is available in
hour protection from beauty. All around the gentle way to skincare! multiple variants in
sweat and body odour world, Dove is making soaps and specialist
and therefore the complete therapy for your formats such as liquid
confidence to handle hair. hand wash, catering to
whatever the day has the entire family.
in store.

6. CONT….
New Clear with Essential Oils, Clinic Plus is India’s largest selling Sunsilk encourages young women in
guarantees Zero dandruff and shampoo and has won the trust the India to live for today. Sunsilk helps you
leaves your hair feeling fabulous. millions of families across India. transform the beauty of your hair
instantly because LIFE CAN'T WAIT!!
Dove stands for real beauty. All around Freshness that brings you Closer Pepsodent India is committed to improve
the world, Dove is making complete the overall Oral health of Indians.
therapy for your hair.

7. Analysis of Distribution Network of
HUL
 We have analyzed the distribution network of HUL from the
following aspects:
1. Evolution of HUL’s distribution network
2. Transportation & Logistics
3. Channel Design
4. Initiatives taken for channel member management
5. Field force management
6. Analytical Framework
7. Financial Analysis

8. Evolution of HUL’s distribution
Network
 The first phase of the HUL distribution network
had wholesalers placing bulk orders directly with
the company
 The focus of the second phase, which spanned
the decades of the 40s, was to provide desired
products and quality service to the company's
customers
 The highlight of the third phase was the
concept of "Redistribution Stockist" (RS) who
replaced the RWs

9. Distribution System
 Distribution system’s focus to enable easy access to
their brands, touch consumers with a three-way
convergence - of product availability, brand
communication, and higher levels of brand
experience.
 The most obvious function of distribution system is to
provide the logistics support to get the company’s
product to the end customer.
 The another important role of this system is to
maintain the information flow between company to
consumer.

10. CONT…..
 HUL's products, are distributed through a network of
about 7,000 redistribution stockists covering about
one million retail outlets.
 The general trade comprises grocery stores,
chemists, wholesale, kiosks and general stores.
 Company provides tailor made services to each of its
channel partners.
 HUL is using the point of purchase method for much
higher level of direct contact, through in-store
facilitators, sampling, education and experience.

11.  The distribution network of HUL is one of the key strengths
that help it to supply most products to almost any place in
the country from Srinagar to Kanyakumari
 This includes, maintaining favorable 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

12. Distribution at Villages…
RURAL DISTRIBUTION MODEL

13. Distribution at the Villages:
 The company has brought all markets with
populations of below 50,000 under one rural sales
organisation
 The team comprises an exclusive sales force and
exclusive redistribution stockiest and focuses on
building superior availability of products
 In rural India, the network directly covers about
50,000 villages, reaching 250 million consumers,
through 6000 sub‐stockists

14. Marketing Strategies for Rural
Areas
 For long term benefit HUL started PROJECT STREAMLINE in
1997.
 Appointed 6000 sub–stockists that directly covers about
50000 villages & 250million customers.
 Integrate, economic, environment, & social objective with
Business Agenda.

15. Distribution at Urban Centers…
 Distribution of goods from the manufacturing
site to C & F agents take place through
either the trucks or rail roads depending on
the time factor for delivery and cost of
transportation.
 Generally the manufacturing site is located
such that it covers a bigger geographical
segment of India.
 From the C & F agents, the goods are
transported to RS’s by means of trucks and
the products finally make the ‘last mile’ based
on the local popular and cheap mode of
transport.

17. Marketing Strategies for Urban
Areas
 Focuses on short supply chain for
distribution.
 Meet every need of people
everywhere.
 Build segments & market for the
future
 Emphasis on Direct selling,
Franchisee to reach everyone .

18. New Distribution Channels…

19. New distribution channels
 Project Shakti
Started in the late 2000, Project Shakti had
enabled Hindustan Lever to access 80,000 of
India's 638,000 villages .HUL's partnership with
Self Help Groups(SHGs) of rural women, is
becoming an extended arm of the company's
operation in rural hinterlands
 Project Streamline
Project Streamline is an innovative and
effective distribution network for rural areas
that focuses on extending distribution to
villages with less than 2000 people with the
help of rural sub‐stockists/Star Sellers who are
based in these very villages. As a result, the
distribution network directly covers as of now
about 40 per cent of the rural population

21. Project Streamline….

22. Hindustan lever Network
 Mother Depot and Just in Time
System
 Leveraging Information technology
 RS Net Initiative
 Adexa iCollaboration suite

23. HUL’s Turnover Compared with Competitors, 2006

24. HUL’s Market Leadership across various FMCG Categories

25. Channel Design
 Hindustan Lever Limited (HUL) has two
types of channel selling ‐
i. Regular (traditional) retail channel,
ii.Direct Selling Channel in the name of
Hindustan Lever Network (HLN).

26. Channel structure
Redistribution stockists:-
 Sales Margin: 4.76% which includes cash discount, unloading e
xpenses from depot, distribution expenses to retailers, incenti
ve schemes & other incidental expenses.
 Modes of transport used: Rickshaw, tempo.
 Incentive schemes: Before 2000 holiday packages and tours but aft
er 2000 no non‐monetary incentive for RS.
 Software systems and Information System: UNIFY 8.3 (Developed b
y IBM & CMC). This software needs to be synchronized daily and t
he system updates any information/ incentive schemes / sales figur
es etc to and from the common shared platform.
 Areas of Operations: Marked for each of the RS.
 Selling Operations: RSs sells the goods to ‐
o Wholesaler (gets 1.5 % max. discount from RS)
o Retailers (gets 1.0% max. discount from RS)

27. Wholesaler:
 Gets cash discounts and other schemes promoted by HUL (gets
points under Vijeta Scheme).
Retailers:
 Total retailer base in Jamshedpur: Approximately 1070.
 Sales Margin: Depends on the product
 o Soap, detergents ‐ 8% on MRP
 o Cosmetics ‐ 10% on MRP
 o Food items ‐ 8% on MRP
Incentive schemes:
 Company programs (Scheme Discounts + Cash Discounts)
 TPR schemes based on Sales (1 % to 4 %)
 Vijeta scheme is not for retailers.
Field Sales Force:

28. Initiatives Taken to Improve The
Distribution Network
 Setting up of a full‐scale sales organization comprising key
account management and activation to impact, fully engage
and service modern retailers as they emerge.
 Servicing Channel partners and customers with continuous
daily replenishment.
 Leveraging scale and building expertise to service Modern
Trade and Rural Markets.
 Delaying of sales force to improve response times and
service levels
 Launching the Unicare scheme with upmarket pharmacies and
retailers to sale its premium brands.
 Launching of several promotional schemes for existing
wholesalers and distributors.

29. Field Force Management
 In HUL, the field force is evaluated using
QOC (Quality of Contribution). It consists
of 4 components ‐
 1. Secondary Sale (Max points = 2.5)
 2. Eco (Max points = 0.5)
 3. Focus (Max points = 0.5)
 4. FCS (Max Points = 0.5)

30. Non Monetary Methods
 Based on the QOC various awards are distributed to the field
persons at the end of every month. These awards are also
known as ‘MOC Star’ awards.
 If QOC score > 4.5 - The person is eligible for 7 star award
 If QOC score > 4 - The person is eligible for 5 star award
 If QOC score > 3.5 -The person is eligible for 3 star award

31. Analytical Framework
 We tried to analyze HUL’s distribution network in the light of
20 most significant variables that affect the distribution part 0f
channel management for any organization in the business of
marketing & selling of goods.
1. No of Consumers
2. Geographic Dispersion Of Consumers
3. Frequency of purchase
4. Tendency to postpone purchase
5. Level of Familiarity/Knowledge (of consumer)
6. Degree of brand loyalty
7. Purchased on Impulse
8. level of Involvement(LOI)
9. Purchased as a Basket of Goods
10. Speed & complexity of Decision making process

32. Analytical Framework cont….
11. present of Expert influencer in the decision making process
12. Element of crisis purchase exists
13. Element of risk aversion exists
14. Perish ability of the product
15. Time band associated with the purchase of the product
16. Fungibility
17. Degree of customization possible
18. Negative/Positive reinforcing product
19. Value/Volume ration(value density) of the product

33. Financial Analysis
Marketing Expenses
As stated earlier also, marketing expenses here
include the following –
- Commissions
- Rebates 29
- Discounts
- Sales promotional
- Expenses on direct selling agents
- Entertainment expenses etc.
Distribution Expenses
 Distribution expenses include the outward freight
cost to the company.

34. Thank-You