Final docDEMAND FORECASTING OF HUL

THE INDIAN INSTITUTE OF PLANNING AND MANAGEMENT

NEW DELHI

A PROJECT REPORT ON “DEMAND ANALYSIS OF HUL’S PRODUCT SURF EXCEL ” EXTERNAL GUIDE: PROF.U.C.TIWARY

SUBMITTED BY:

DIBYENDU DAS GAURAV MITTAL

PANKAJ SINGH YASHASWI RAJ GROUP NO-F211

BATCH: IIPM/PGP/FW/2010-2012

Acknowledgement

IIPM NEW DELHI Page 1

We have prepared this study paper for the “DEMAND ANALYSIS OF HUL’S SURF

EXCEL”. Quite frankly, we have derived the contents and approach of this study paper through

discussions with colleagues who are also the students of this course as well as with the help of

various Books, Magazines and Newspapers etc.

I would like to give my sincere thanks to Mr.Somnath Acharya (territory manager of south delhi)

, friends and the teachers who, through their guidance, enthusiasm and counseling helped me

enormously. As I think there will be always need of improvement. Apart from this, I hope this

study paper would stimulate the need of thinking and discussion on the topics like this one.

DIBYENDU DAS

GAURAV MITTAL

PANKAJ SINGH

YASHASWI RAJ

Executive Summary


Hindustan Unilever Limited is the Indian arm of the Anglo-Dutch company –Unilever. Both

Unilever and HUL have established themselves well in the Fast Moving Consumer Goods

(FMCG) category. In India, the company offers many households brands

like, Dove,Lifebuoy, Lipton,Lux, Pepsodent, Ponds, Rexona, Sunsilk, Surf, Vaseline etc.

Some of its efforts were also rewarded when four of HUL brands found place in the ‘Top 10

brands’ list for the year 2008 published in The Economic Times.

Unilever was a result of the merger between the Dutch margarine company, Margarine Unie, and

the British soap-maker, Lever Brothers, way back in 1930. For 70 years, Unilever was the

undisputed market leader but now faces tough competition from Proctor & Gamble and Colgate-

Palmolive.

HUL is also known for its strong distribution network in India. In order to further strengthen its

distribution in the rural areas and to empower the local women, HUL launched a

project Shakti in 2000 in a district in Andhra Pradesh. The idea behind this project was to create

women entrepreneurs and provide them with micro-credit and training in enterprise management,

which would enable them to create self-help groups and become direct-to-home distributors of

HUL products. Today Shakti is present across 80,000 villages in 15 states and is helping many

underprivileged women earn their livelihood.

As the per capita income of India increasing along with the Indian population. So, the future for

the FMCG Companies is bright. To analysis the past performance & the future demand of HUL,

FMCG products we have considered following points:

We have a listed the different FMCG product lines of HUL. We have done competitor’s

analysis in which the market share of top FMCG companies are analogized & the market

share of HUL’S different categories product are analogized with comparison to its

competitors.

Then we have done SWOT analysis to know the threat & opportunities of HUL in present

market.


Then performance analysis is made by taking 5year financial data from 2006-2011. The

profit & sales growth is analyzed.

Then the future opportunities for FMCG products are taken into consideration by

analyzing the increased per capita income & increased disposable income to forecast the

future demand of HUL.

TABLE OF CONTENTS


Chapter 1.

Background……………………………………………………………6

Chapter 2. Corporate

Information……………………………………………………………13

Chapter 3OBJECTIVE &

METHODOLOGY…………………………………………………..16

Chapter 4PRODUCT

LINE…………………………………………………………………..18

Chapter 5DEMAND

FORECAST………………………………………………………….30

Chapter 6 MARKET

SHARE………………………………………………………………37

Chapter 7COMPETITORS OF

HUL………………………………………………………………….42

Chapter 8SWOT

ANALYSIS……………………………………………………………49

Chapter9.forecasting methods……………………………………....51

Chapter10.Calculations……………………………………………...59

Chapter11.Conclusion………………………………………………62


CHAPTER 1

BACKGROUND

History & Chronology


The summer of 1888, visitors to the Kolkata harbor noticed crates full of Sunlight soap bars,

embossed with the words "Made in England by Lever Brothers". With it, began an era of

marketing branded Fast Moving Consumer Goods (FMCG). Soon after followed Lifebuoy in 18

95 and other famous brands like Pears, Lux and Vim.Vanaspati was launched in 1918 and the

famous Dalda brand came t o the market in 1937. In 1931, Unilever set up its first Indian

subsidiary, Hindustan Vanaspati Manufacturing Company, followed by Lever Brothers India

Limited (1933) and United Traders Limited (1935). These three companies merged to form HUL

in November 1956 ; HUL offered 10% of its equity to the Indian public, being the first among the

foreign subsidiaries to do so. Unilever now holds 52.10% equity in the company. The rest of the

shareholding is distributed In among about 360,675 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. Since the very early years, HUL has vigorously responded to

the stimulus of economic growth. The growth process has been accompanied by judicious

diversification, always in line with Indian opinions and aspirations. The liberalization of the

Indian economy, started in 1991, clearly marked an inflexion in HUL's and the Group's growth

curve. 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 1995, HUL and yet another Tata company, Lakme Limited, formed a 50 :50

joint venture, Lakme to market Lakme's 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. HUL has

also set up a subsidiary in Nepal, Unilever Nepal Limited (UNL), and its factory represents the

largest manufacturing investment in the Himalayan kingdom. The UNL factory manufactures

HUL's products like Soaps, Detergents and Personal Products both for the domestic market and

exports to India. 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 Doo m Doo ma, two plantation companies of Unilever, were merged

with Brooke Bond. Then in July 1993, 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 Ice cream Group families and

in 1995 the Milk food 100% Ice cream marketing and distribution rights too were acquired.

Finally, BBLIL merged with HUL, with effect from January 1, 1996. The internal restructuring

culminated in the merger of Pond's (India) Limited (PIL) with HUL in 1998. The two companies

had significant overlaps in Personal Products, Specialty Chemicals and Exports businesses,

besides a common distribution system since 1993 for Personal Products. The two also had a

common management pool and a technology base. The amalgamation was done to ensure for the

Ground benefits from scale economics both in domestic and export markets and enable it to fund

investments required for aggressively building new categories. In January 2000, in a historic step,

the government decided to award 74 per cent equity in Modern Foods to HUL, thereby beginning

the divestment of government equity in public sector undertakings (PSU) to private sector

partners. HUL's entry into Bread is a strategic extension of the company's wheat business. In

2002, HUL acquired the government's remaining stake in Modern Foods. In 2003, HUL acquired

the Cooked Shrimp and Pasteurized Crabmeat business of the Amalgam Group of Companies, a

leader in value added Marine Products exports.



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".

Some of its brands include Kwality Wall's ice cream, Lifebuoy, Lux, Breeze, Liril, Rexona,

Hamam, Moti soaps, Pureit Water Purifier, Lipton tea, Brooke Bond tea, Bru Coffee, Pepsodent

and Close Up toothpaste and brushes, and Surf, Rin and Wheel laundry detergents, Kissan

squashes and jams, Annapurna salt and atta, Pond's talcs and creams, Vaseline lotions, Fair &

Lovely creams, Lakme beauty products, Clinic Plus, Clinic All Clear, Sunsilk and Dove

shampoos, Vim dish wash, Ala bleach and Domex disinfectant, Rexona, Modern Bread and Axe

deospray. HUL has produced many business leaders for corporate India. It is referred to as a

‘CEO Factory' in the Indian press for the same reasons. It’s leadership building potential was

recognized when it was ranked 4th in the Hewiit Global Leadership Survey 2007 with only GE,

P&G and Nokia ranking ahead of HUL in the ability to produce leaders with such regularity.

Today, HUL is one of India’s largest exporters of branded Fast Moving Consumer

Goods. It has been recognized by the Government of India as a Golden Super Star

Trading House.

Over time HUL has developed into a viable & competitive sourcing base for Unilever world

wide in Home and Personal Care & Foods & Beverages category of products. HUL is also a

global marketing arm for select licensed Unilever brands and also works on building categories

with core country advantage such as brandedbasmatirice.

HUL Exports offers high level of service with flexibility and responsiveness thorough out the

supply chain. It has a dedicated organization structure to support this endeavor and this has

helped in growth of these businesses in particular. Intrinsic cost competitiveness in the end to

end Supply chain with appropriate technology and competitive capital investment operations

while delivering best in class quality enables HUL to position itself as a key sourcing hub for

Unilever and also become a preferred partner for Global customers in categories we operate.


HUL’s key focus in the exports business is on two broad categories. It is a sourcing base for

Unilever brands in Home & Personal Care (HPC) and Food and Beverages (F&B) for supplies to

other Unilever companies. It also focuses on becoming a preferred supplier to both non-Unilever

and Unilever clients in three categories in which India, as a country, has competitive advantage –

Branded Rice, Marine Products and Castor and its Derivatives. HUL enjoys international

recognition within Unilever and outside for its quality, reliability and speed of customer service.

HUL's Exports geography comprises, at present, countries in Europe, Asia, Middle East, Africa,

Australia, and North America etc.

HUL’s products touches two out of three Indian everyday

Reach 80% Households

Direct Coverage of 1mln outlets

2000 Suppliers and Associates

71 Manufacturing locations

15000 Employees

1100 managers

Shelf availability 84% outlets in India


CHAPTER2.CORPORATE INFORMATION

Corporate Information


Hindustan Unilever Limited,

165/166, Backbay Reclamation

Registered Office Mumbai – 400020

Tel : +91 – 22 – 39830000

Fax no. : +91 – 22 –22026712

Ashok.K.Gupta,

Executive Director (Legal) and Email : [email protected]

Company Secretary Tel nos. : +91-22-39832567/ 39832358 /39832557

Lovelock & Lewes,

Chartered Accountants

Statutory Auditors

252, Veer Savarkar Marg

Dadar, Mumbai- 400 028

Crawford Bayley & Co.

State Bank Building

Solicitors

N.G.N. Vaidya Marg

Mumbai – 400 023

Karvy Computershare Private Limited

Unit : HINDUSTAN UNILEVERLIMITED

Plot No. 17 to 24, Vittalrao Nagar,

Registrar and Share Transfer Madhapur, Hyderabad – 500 081.

Agents Phone : +91- 40 23420818-823

Fax : +91- 40 23420814

Email : [email protected]


Website : www.karvy.com

Unilever India Exports Limited

Bon Limited

Unilever Nepal Limited

Pond’s Exports Limited

Daverashola Estates Private Limited

Jamnagar Properties Private Limited

Subsidiary Companies Shamnagar Estates Private Limited

Brooke Bond Real Estates Private Limited

Hindustan Unilever Field Services Private Limited Levers Associated Trust Limited

Levindra Trust Limited Hindlever Trust ltd


CHAPTER3

OBJECTIVE & METHODOLOGY

OBJECTIVES AND METHODOLOGY

OBJECTIVE


Primary objective

To find the past sale growth and demand analysis

Secondary Objective

Market structure analysis

SWOT analysis

Competitor analysis

Performance evaluation

Trend Analysis

Moving Average Analysis

Methodology

In this project we have followed descriptive method of study.

Research instrument

Here project analysis is made by collecting secondary data from different websites, journals, etc.

Secondary data’s are pre published and research data’s collected from different websites,

journals, newspapers, company research papers.

These documents and data’s are very useful for the theoretical, conceptual and

organizational background analysis.

Detailed analysis of data’s is made by plotting different graphs and tables which can be

easily understandable.

Then by observing these graphs we have made our conclusions and recommendations.


CHAPTER4.

PRODUCT LINE


PRODUCT LINE

A) HOME AND PERSONAL CARE:1) Personal washLux BreezeLifebuoy DoveLiril Pears Hamam Rexona

2) Laundry 3) Skin CareSurf Excel Fair and lovelyRin Pond’sWheel Aviance

4) Hair care 5) Oral careSunsilk naturals PepsodentClinic Close up

6) Deodorants 7) Colour CosmeticsAxe LakmeRexona

8) Ayurvedic Personal and health care: AyushB) FOODS1) Tea 2) Coffee 3) Foods 4) Ice cream Brooke Bond Brooke Bond Bru Kissan Kwality walls Lipton Knor

AnnapurnaC) WATER PURIFIER Pureit

Most Popular Products of HUL


Axe, the deodorant that is considered cool, fashionable and stylish by young men was launched in

India in 1999. Available in more than 60 countries around the world, it is a world leader in male

toiletries.

Axe has a mix that is completely harmonized globally from its proposition and communication to

the product, as available on the shelf.

Axe is available in five fragrances: Java, Pulse, Dimension, Voodoo and Phoenix. Axe has

become the leading male deodorant brand in India within just one year of its launch.

Consumers associate a lifestyle of cool clubs, cool music and cool fashion with Axe. The youth

view it as an icon which introduces many 'firsts' to their world of music and dance – like the first

"World's Longest Dance Party" and the first ever 'Axe Voodoo Island Party'


Closeup is the original youth brand of India.

The first brand targeting youth in the oral care market, with an edgy and youthful

image which stays relevant till date. Ever since its launch in 1 975, Closeup has broken

every rule in the book on how tooth pastes should behave!

Closeup was the first gel toothpaste to be launched in India and has led the gel

toothpaste segment ever since.

In 2004, Closeup was re-launched with a bang. And this time it was packed with the

power of Vitamin Fluoride System – a powerful mix of Vitamins, Fluoride,

Mouthwash and Micro whiteners, the perfect combination of ingredients for fresher

breath and stronger, whiter teeth. Closeup became the first Gel toothpaste with

Fluoride in the Indian Market! The brand umbrella also includes Closeup Lemon Mint,

gel toothpaste with the whitening benefits of lemon.


Dove soap, which was launched by Unilever in 1957, has been available in India since

199 5. It provides a refreshingly real alternative for women who recognize that beauty

is not simply about how you look, it is about how you feel.

The skin's natural pH is slightly acidic 5.5-6. Ordinary soaps tend to be alkaline, with

pH higher than 9. Dove is formulated to be pH neutral (pH between 6.5 and 7.5) and to

be mild on skin. This makes it suitable for all skin types for all seasons. While Dove

soap bar is widely available across the country, Dove Body Wash is available in select

out lets.

Globally, Dove has been extended to many other countries. Since the 1980s, for

example, Unilever has launched a moisturizing body-wash, deodorants, body lotions,

facial cleansers and shampoos and conditioners, providing a comprehensive range of

solutions to bring out true inner beauty.


A woman's passion for beauty is universal and catering to this strong need is Fair & Lovely.

Based on a revolutionary breakthrough in skin lightening technology, Fair & Lovely was

launched in 1978.

The Hindustan Lever Research Centre (it is among the largest research establishments in India's

private sector, including pharmaceutical companies, with facilities in Mumbai and Bangalore)

deployed technology, based on pioneering research in the science of skin lightening to develop

Fair & Lovely. The formulation is patented. Its formulation acts safely and gently with the natural

renewal process of the skin, making complexion fairer over a period of six weeks. Fair & Lovely

is formulated with optimum levels of UV sunscreens and Niacinamide that is known to control

dispersion of melanin in the skin. It is a patented and proprietary formulation, which has been in

the market for 25 years. Niacinamide (Vitamin B3) is a water-soluble vitamin and is widely

distributed in cereals, fruits and vegetables - and its use in cosmetic formulations has been known

for various end benefits. The UV components of the formulation are scientifically chosen and

used at optimum levels to provide wide spectrum protection against UV rays of the sun.

Specifically, this patented formulation offers a high UVA protection, which is more relevant to


Asian skin than plain SPF protection creams sold in the West. All the active ingredients

in the Fair & Lovely formulation function synergistically to lighten skin color

through a process that is natural, reversible and totally safe.

The brand today offers a substantive range of products, including Ayurveda Fair &

Lovely Fairness cream, Fair & Lovely Anti-Marks cream, Fair & Lovely Oil

control Fairness Gel, Fair & Lovely for Deep Skin and Fair & Lovely Fairness

Soap. The latest has been the Perfect Radiance, a complete range of 12 premium

skincare solutions from Fair & Lovely.

Half a century ago, as India took her steps into freedom, Lakme, India's first beauty brand was

born. At a time when the beauty industry in India was at a nascent stage, Lakme tapped into what

would grow to be amongst the leading, high consumer interest segments in the Indian Industry -

that of skincare and cosmetic products. Armed with a potent combination of foresight, research

and constant innovation, Lakme has grown to be the market leader in the cosmetics industry.

Lakme today has grown to have a wide variety of products and services that cover all facets of

beauty care, and arm the consumer with products to pamper herself from head to toe. These

include products for the lips, nails, eyes, face and skin, and services like the Lakme Beauty Salons


Since 1929, Lux in step with the changing trends and evolving beauty needs of the

consumers, offers an exciting range of soaps and Body Washes with unique elements

to make bathing time more pleasurable. One can choose from a range of skincare

benefits like firming, fairness and moisturizing. Lux stands for the promise of beauty

and glamour as one of India's most trusted personal care brands. Lux Believes in

passion for beauty .It continues to be a favorite with generations of users for the

experience of a sensuous us and luxurious bath. Lux believes that femininity shouldn’t

be denied. Since its launch in India in the year 1929, Lux has offered a range of soaps

in different sensuous colors and world class fragrances. Lux is a beauty soap of film

stars, Lux recognized the need for a compelling message about beauty that would

resonate with women of today. Lux has recently launched its two fruit extract variants

– New Lux Strawberry & Cream and Lux Peach & Cream contain a blend of succulent

fruits & luscious Chantilly cream that melts down into your skin making it soft and

smooth.


Introduced in India in 1902, Pears soap has no equal. It is gentle enough, even for

baby's skin. A pear is manufactured like any other soap, but unlike in conventional

soaps, the glycerin is retained within the soap. That is the cause if it’s unique

transparency. After manufacturing, the soap is mellowed under controlled

conditions over weeks. At the end of this maturing process, it is in dividedly

polished and packed in cartons. Today Pears is available in three variants - the

traditional amber variant, a green variant for oil control and a blue variant for germ

protection.


Pepsodent, launched in 1993, was the first toothpaste with a unique anti-bacterial agent to address

the consumer need of checking germs even hours after brushing.

Pepsodent packs included a Germ Indicator in February-May 2002, which allowed consumers to

see the efficacy in fighting germs for themselves. As a follow-up, in October 2002, Pepsodent

offered Dental Insurance to all its consumers to demonstrate the confidence the company has in

the technical superiority of the product.

Pepsodent connects directly with kids and their parents. Pepsodent has always worked in the

direction of an overall awareness of dental health. The prelaunch campaign in October 2003

widened the context to "sweet and sticky" food and leveraged the truth that children do not rinse

their mouths every time they eat, demonstrating that this makes their teeth vulnerable to germ

attack.

Pepsodent's most recent campaign aims at educating consumers on the need for germ protection

through the night.

Pepsodent also includes a range of toothbrushes.


Pond's has been synonymous with skin care in India since 1947.The impressive track record of

Pond's began when Theron T Pond, a pharmacist from Utica New York, introduced 'Pond's

Golden Treasure' in 1846, a witch-hazel based wonder product. In 1914, Pond's Cold Cream and

Vanishing Cream marked the brand 's evolution to a beauty icon. In 1955 Pond's Extract

Company merged with Chesebrough Manufacturing and in 1987 Unilever purchased

Chesebrough -Pond's. By this time the Pond's brand had built up a powerful international

presence.

From one man in a tiny home- made laboratory, to today's state of the art R&D

facilities led from Bangkok, Mumbai, New York and Tokyo, the Pond's promise

has remained the same across 58 countries - to deliver products that make a real

difference to women's skin and the way they live their lives.


A pioneer in the Indian detergent powder market, Surf Excel has constantly upgraded itself over

the years, to answer the constantly changing washing needs of the Indian homemaker. Today Surf

Excel offers outstanding stain removal ability o n a wide range of stains. This means that mot hers

now have the freedom to let their kids experience life without worrying about stains. Surf Excel

quick wash is powered with a path -breaking technology- it reduces water consumption and time

taken for rinsing by 50%. It is a significant benefit, given the acute water scarcity in most of

India.

Surf Excel is available in 3 variants: Surf Excel Blue, Surf Excel Quick Wash and Surf Excel

Automatic. So whatever be the need, Surf Excel hai na.


CHAPTER5.DEMAND FORECAST


DEMAND FORECAST

Hindustan Unilever Ltd. (Bombay Stock Exchange: 500696) makes fast-moving

consumer goods (FMCG) such as detergents, toiletries, and food staples. The

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

brands.. HUL recorded 2 0.02% year over year (yoy) growth in revenue at Rs

16660.38 cores during the year ended Dec'08 . Its Soaps and Detergents business

was its largest contributor to revenues with 46% of total revenues where as

Personal Care products contributed the most (46%) towards EBIT (Earnings before

Income Tax). Raw material prices for palm oil and other chemicals increased of 31%

from Nov'10 -Apr'11, which led the company to implement a price hike by a weighted

average of 10% from April to June 2011 in order to protect its margins. From April to October

2011, however, palm o il prices declined 62.2% so Hindustan has accrued higher revenue on

lower volume sales in late 2011, early 2012.

Increase in per capita income in urban, as well as rural areas, of India has a

positive effect on demand of consumer goods along with a shift in demand towards

high end lifestyle products. Long a provider of low cost consumer goods, HUL has

recently launched products in its high end segments.

Business and Financial Metrics[

Sales growth of 13.36% in CY'10 (Calendar Year 2010) and 9.38% in CY'09can

be attributed to aggressive launches, re-launches of products and a hike in product

prices. The net Income of the company has not increased at the same pace as

\revenues because of a decline in margins (from 18.5% in CY'06 to 16.7% in

CY'09) in its soaps and detergents business and investment in IT and water purifier

business in CY 05-06.


2006 2007 2008 2009 2010 20110

50010001500200025003000

Profit After Tax

Profit After Tax

HUL Total Income and Net Profit over the years (in Rs. Crore)

There is an insignificant change in company's revenue mix in CY04-07 period.

Soaps and Detergents business contributes highest (46%) towards revenues

followed by Personal care products (26%). Despite being highest revenue

generator soaps and detergents business is not the most profitable segment.

Personal care contributes highest (46.2%) towards the EBIT which is due to high

margins and low penetration of the market.

2006 2007 2008 2009 201002468

101214161820

ColuChemical agri & OthersFoodsPersonal ProductSoap & Detergent

HUL Total Sales Revenue distribution across segments (in %)

Discussion FY'09 (Financial Year 2009) : HUL has shown steady sales growth

by 19-2 0 % in Jan - Sep'08 but it was largely price led due to a hike in product prices

in the previous two quarters . Volume growth has decreased from 10.2 % in Q1CY08 (1st

quarter Calendar Year 2008) to 6.8% in Q3CY08. EBIT margins fell by 30bps to 12.9 due to


inflation of Commodities prices but net pro fit saw a raise to 34% on account of income from

sale of properties. Soaps and Detergents (46% Revenue, 44% EBIT): This segment

includes Personal Wash products like soaps, detergent bars, detergent powders, detergent

liquids, scourers, etc. Sales of the segment grew sales by 13.9% and 20.3% in CY07 and

H1CY08 respectively. Fabric Wash has shown strong growth in this year with the mark et

share moving up from 34.6% in Q4CY06 to 38.3% in Q2CY08 Profitability margins

which declined from 25.7% in CY'02 to 13.7 % in CY'05 due to pricing actions from

P&G in the Laundry segment have slightly recovered to 15 .6% (CY'07).

Personal Care Products (26% Revenue, 46.2% EBIT) : This business which comprises

mainly skin care, hair care and oral care is the most profitable segment for HUL. It is

highest contributor to HUL’s EBIT at 47 %. Low penetration and consumption of personal

products has sustained these categories' high growth rates. This segment has shown a

revenue growth of 20.9% in H1CY08 and the new launches in the Ponds and Dove range

contributed to the profitability of the segment.

Beverages (11% Revenue,10.3% EBIT) : HUL's beverages business is operated through the

Brooke Bond and Lipton brands for packet tea and Bru brand for coffee. With the aggressive

re launch of Brooke Bond, Taj Mahal and Taaza, the company has been able to arrest the decline

in its market share. Overall margins have declined to 15% in CY'07 from 20% in CY'04 due to

hike in Coffee bean prices.

Foods (4% Revenue, 0.8% EBIT) :In spite of having one o f the best distribution networks

(coverage of 6.3 mn outlets) in the country, the food business has never constituted a big

part of revenues. Thatswhy this is the current focus area for the company. Presence in the

foods category is mainly through soup mix, Chinese meal maker, jams, ketchups and salts.

HUL is clearly keeping a low profile in the stap les category, which is low margin

business. Foods margin dipped partly due to launch related costs for Amaze brain foods

(launched in two southern states during the January– March 2008 quarter).


IceCream(1% Revenue, 0.6%EBIT) : This segment includes include Ice Creams and Frozen

Desserts. Kwality Wall' s, launched in 1995, is the company's master brand for ice cream. It

has launched Moo brand that boosts children’s calcium levels in the June quarter of CY07.

Exports : Exports include sales of Marine Products, Castor, etc. as well as sales o f soaps

and detergents, personal products, beverages and foods etc. by the Exports Division. Exports

are the lowest-margin business for the company. It has already exited the low-margin shrimps

and castor business.

Others: This section includes Chemicals, Water purifiers, Agri seeds, Property Development,

Water business, Ayush services etc. It has seen a growth of 41.5% as Pure It (a water

purifier product) increased its reach to more than 600 towns.

HUL revenue distribution across segments for CY'07 [ 3]


Trends and Forces

Increasing raw material prices drives HUL to raise its prices[

\Raw materials constitute a big chunk (63%) of input cost for FMCG sector

companies. For HUL- Palm Oil and Chemicals contribute 59% of total raw

material cost. Due to inflated input cost in Soap and Detergents division EBITDA

(earnings before income tax and depreciation) margins fell from 19.7% in CY03 TO

13.7% in CY07.

The first steep increase in the prices (31% in No v'07-Apr'08 period) of key raw materials

such as palm oil, LAB - Linear Alkyl Benzene, caustic soda, soda ash, raw tea, coffee

and crude oil derivatives has led the company to implement price hikes in competitive

segments like toothpaste, soaps, detergents and shampoo. The weighted average price increases

were 8% in January -March 2008 period and 10%in April-June 200 8.

But recently softening Inventories - Raw Materials prices in the last 2-3 months

have provided respite to FMCG sector companies. Raw material and packaging

materials have fallen sharply from their highs recorded in Sep'08. Palm oil and

Brent Crude have fallen by 62.2% and 40.1% from Aril'08 prices. The benefit of fall in

raw material prices will be accrued later when high cost inventory will be replaced by a

cheaper inventory.

Increasing per capita income drives FMCG sector growth

Per capita Income in India has doubled in 4 years 04-07. As their incomes and standards

of living improve, Indian customers’ for FMCGs are shifting towards higher lifestyle

categories like skin care, hair care, deodorants, convenience foods, health foods etc.

Rural India, where penetration levels are low as compared to urban areas, has a

large consuming class with 41 per cent of India's middle-class and 58% of the total

disposable income. Factors like loan waiver of farmers, hike in minimum support price for

crops and flood inflation has helped farmers with rise in income. The purchasing power in


rural areas has increased and spending behavior is also changing which shows a high growth

potential for FMCG companies here. HUL has adapted itself to changing consumer spending

patterns. Among man y product launches, Dove hair care products, re-launch of Axe

deodrants and launch of ponds Anti Ageing cream are few to be mentioned in high end price

spectrum in Personal care. Targeting low income group people, HUL has launched 50 paise

shampoo sachets in 200 7. Along with these, Company's premium pro ducts are now sold thorugh

Modern Trade. Also it has entered into a Joint venture with Solons Holdings of South Africa

to increase its capabilities to meet the merchandising g demands in Modern Trade.

Per Capita consumption of personal care products in India is one of the lowest

among developing economies of the world.

India has one of the lowest levels in per capita consumption o f consumer goods among

developing economies of the world. It has per capita consumption levels of 1.4,0.3,0.2 and 0.3

US$ in detergents, shampoo, ice-creams and skin care segments respectively which are lower

than that of China, Brazil and Indonesia.

Consumption levels in the U.S., a developed country, are 16.6, 6.7, 49.4 and 36.6 in

categories mentioned before. Low consumption coupled with increase in per capita income

poses as a growth opportunity for consumer products companies

Highly Competitive FMCG Sector limits profit margins of HUL.[

In a volume driven and competitively intense environment with competition also

from local p layers FMCG players are aggressively promoting their brands to gain

\product awareness, customer base, and their shares of the customers’ wallets. To facilitate

launch new products and re launch of existing products companies are increasing their

research and development expenditure. These factors eat up the profitability margins of the

companies .HUL has consistently been the top advertisement spender over the years with

expenditure of Rs 650 cro re in the year 2008. Second largest spending is Rs 240 crore

by a telecom company. P&G India and Colgate- Plamolive, other FMCG players, also

feature in the top 10 advertisers list. HUL has increased its advertising expenses by 26.56% in

CY'07.Also the money spent in Research and Development which facilitates new product

launches and re-launches of existing products has seen a raise by 38.16% in the same year.

Pricing scenario in current time is in favor of companies but in past due to p ricin g war with


P&G in Soaps and Detergents, HUL's margins in the segment declined from a high of

25.7% in CY02 to 13.7 % in CY05.

CHAPTER 6.MARKET SHARE


MARKET SHARE

This chart explains more about t he market share o f HUL. The Total turnover o f Hul was 2961

million US$ way ahead o f its competitors like Nestle, Dabur, Godrej, Marico etc.

HUL or Hindustan Unilever is the number one Indian Band. It is The Market

leader in number of products. In 2007, Hindustan Unilever was rated as the most

respected company in India for the past 25 years by Business World, one of India’s

leading business magazines. 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. It has over 35 brands. Sixteen of HUL’s brands featured in the AC

Nielsen-Brand Equity list o f 100 Most Trusted Brands Annual Survey (2008).

According to Brand Equity, HUL has the largest number of brands in the Most Trusted Brands

List.

This is the market share of various divisions of HUL products.. The above Graph

indicates the gap between HUL & other competitors. The value of the graph is 100

basis points. In the division of fabric wash Surf excel and Rin are the market

leaders. Its value is 37% while its competitors value is13.2%.In case os personal

wash HUL brands cross majority of market share of 50%.Brands like Lux, Dove,

Pears are very popular. In case of Dishwsh Hul retains Majority with 56.4 % of

market share while their competitors share was 8.6 %.In case of skin care HUL


was again the number one brand with market share o f 55 % while its competitors

share was 7.4 %.In case of shampoos HUL was number one but Its competitors are

also more. Brands like clinic all clear, sunsilk are the main products in this

category. In the category o f Talcum powder Brands like Ponds and Aviance helped

HUL maintain market share o f 59.8 %. The market share in Packet tea category is

very competitive. But HUL has an slight edge over its competitors with brands like Brooke bond

& Lipton. In category o f Coffee Brooke bond Bru has majority of

market share of 47.5 %, while Other competitors managed 36.8 %. Kissan jam is

the market leader in category o f Jams. It has 63.6 % of market share while other

brands has 5.1% o f market share .


PRESENT STATURE

Hindustan Unilever Limited (HUL) is India's largest Fast Moving Consumer Goods company,

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

Care Products and Foods & Beverages. They endow the company with a scale of combined

volumes of about 4 million tones and sales of nearly Rs.13718 cores.

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 everyday 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 institutions.

HUL's brands - like Lifebuoy, Lux, Surf Excel, Rin, Wheel, Fair & Lovely, Pond's,

Sunsilk, Clinic, Pepsodent, Close-up, Lakme, Brooke Bond, Kissan, Knorr-Annapurna, Kwality

Wall's – are household names across the country and span many categories - soaps, detergents,

personal products, tea, coffee, branded staples, ice cream and culinary products. They are

manufactured over 37 factories across India. The operations involve over 2,000 suppliers and

associates. HUL's distribution network, comprising about 2,500 redistribution stockists , covering

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

consumers.

HUL has traditionally been a company, which incorporates latest technology in all

its operations. The Hindustan Unilever Research Centre (HURC) was set up in


1958, and now has facilities in Mumbai and Bangalore. HURC and the Global

Technology Centers in India have over 200 highly qualified scientists and

technologists, many with post-doctoral experience acquired in the US and Europe.

HUL believes that an organization’s worth is also in the service it renders to the

community. HUL is focusing on health & hygiene education, women

empowerment, and water management. It is also involved in education and

rehabilitation of special or underprivileged children, care for the destitute and HIV-

positive, and rural development. HUL has also responded in case of national

calamities / adversities and contributes thro ugh various welfare measures, most

recent being the village built by HUL in earthquake affected Gujarat, and relief &

rehabilitation after the Tsunami caused devastation in South India.

In 2001, the company embarked on an ambitious programme, Shakti. Through

Shakti, HUL is creating micro-enterprise opportunities for rural women, there b y

improving their livelihood and the standard of living in rural communities. Shakti

also includes health and hygiene education through the Shakti Vani Programme,

and creating access to relevant information through the iShakti community portal.

The program now covers 15 states in India and has over 45,000 women

entrepreneurs in its fold, reaching out to 135,000 villages and directly reaching to

150 million rural consumers.

HUL is also running a rural health programme – Lifebuoy Swasthya Chetana. The

programmer endeavors to induce adoption of hygienic practices among rural

Indians and aims to bring down the incidence of diarrhoea. It has already touched

120 million people in approximately 50, 676 villages across India. The vision is to

make a billion Indians feel safe and secure.

If Hindustan Unilever straddles the Indian corporate world, it is because of being

single-minded in identifying itself with Indian aspirations and needs in every walk

of life.


CHAPTER7. COMPETITORS OF HUL


COMPETITORS

PRODUCT PROFILE OF SOME OF THE COMPETITORS:

The Fiama Di Wills range o f soaps has been launched under the sub - brand Skin Sense. The first

variant to be introduced in this range is Soft Green. This is a gentle caring soap, which helps

enhance retention of sk in proteins making skin look beautiful and youthful.

In February 2008, ITC launched two new ranges of soap - Vivel Di Wills and

Vivel -to cater to the skincare needs of a wide range o f consumers. Backed by


consumer insights, the ranges offer a unique value proposition of bringing together

ingredients that provide multiple benefits of Nourishment, Protection and Hydration in a single

product. Hence providing the ever discerning consumer complete care.

The packaging, reflecting the philosophy of the brand, fuses multiple benefits. The

unique carton pack has been developed b y ITC’s design team to provide a novel

consumer experience. Although the market trend shows that these ITC brands are no competition

to Pears right now. But if ITC improves its distribution network then these brands can be a threat

to HUL. 'Fairone Fairness Cream' was launched jointly by Elder Pharmaceuticals and

Shahnaz Husain. Elder Pharmaceuticals Ltd and Shahnaz Husain, herbal beauty

specialist, had entered into an agreement to launch four skin care products during

2006-20 07. Elder undertakes the manufacturing and marketing of the products,

while the conception and composition is done by Husain. Elder Pharmaceuticals

Ltd. is one of the leading companies in Indi a in the skin care sector. The company

is a major manufacturer o f aloe vera-based skin care products. A fair complexion has always

been associated with success and popularity. Men and women alike desire fairness, it is believed

to be the key to a successful life. Well for women the market is loaded with fairness cream but for

men there are very few creams.


Emami Fair and Handsome is one such cream for men. Emami herbalists and dermato logists

from India along with Activor Corp USA, has created “Fair & Handsome” a fairness cream for

Men with a breakthrough Five Power Fairness System to make skin fair and handsome in 4

weeks.

Garnier is a division of L'Oréal that produces hair care products, including the Fruct is line, and

most recently, skin care products under the name, Nutritioniste, that are sold around the world.

One of their key ingredients is a fruit concentrate used in all their products. It is a combination of

fruit acids, vitamin B3 and B6, fructose and glucose

Natural Fairever was initially launched in A.P. in 1998, following that a national

launch was made in 1999. Fairever is the brand of CavinKare Pvt Ltd(CKPL). This

cream has a blend of saffron and milk. It claims to work from within to provide a

distinctly fairer, glowing complexion much like that of Kashmiri beauties in just 4

weeks Trip le sunscreens also retain your fairness and reduce the harmful effects of

UV rays. It comes in a pack of 50g and 100 g. The 50g pack costs Rs.55. The Fairever claims to

have consumers as a woman who is the young and contemporary woman o f today. She has

strong values and believes in using a natural product that will help bring out her natural beauty

from within. Cinthol talc is a product of GODREJ Consumer Products Ltd (GCPL). GCPL


identifies Cinthol as its power brand. GCPL has launched new Cinthol range of soap, talc and

deodorant with Bollywood actor Hrithik Roshan as its new brand ambassador. Cinthol offers a

range of soaps, talc and deo sprays in three exciting fragrance - Classic, Cologne and Sport - in a

new packaging

Spinz talc is CavinKare Pvt Ltd(CKPL) brand. Spinz Talc is packed in sizes of 20 g, 50 g, 100 g

and 400 g and comes in three fragrances: Exotic Exchante Sandal

The Sp inz talc’s target are girls of around 1 8 to 26 years old from SEC A and B.

Easy-going and fun-loving, who lo ves to have a lo t of friends with whom she

spends time.

Competition

The above table shows the competition among the Indian FMCG brands. HUL is

the leader of the market with maximum market capitalization and maximum sales

turnover. The Net Profit stood at whooping 2500 crore approximately. HUL has

Dominated the FMCG market but now faces a lot of competitors like ITC , Procter

& Gamble, Godrej Consumer pro ducts, Marico etc.


POLICIES

Hindustan Unilever Limited (HUL) supplies high quality goods and services to meet t he daily

needs of consumers and customers. In doing so, the Company is committed to exhibit the highest

standards of corporate behavior towards its consumers, employees, the societies and the

environment in which we operate. Towards this, the Company recognizes its responsibility to

ensure safety and protection of health of its employees, contractors and visitors in all its operating

sites, which include manufacturing, sales and distribution, research laboratories and offices during

work and work related travel.

This Policy document defines the vision, principles, aim, required actions and

scope of the policy application as well as the responsibility for execution.

Vision

HUL’s vision is to be an injury free organization.

Mission

We will bring safety on top of mind for all employees and will integrate it with all

business processes. We will realize our Vision through an Integrated Safety

Management app roach, which focuses on People, Processes, Systems, Techno logy

and Facilities, supported by demonstrated leadership and employee commitment at

all levels as the prime drivers for ensuring a safe and healthy work environment.

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 aud its are a must

. Employee involvement is essential

. All deficiencies must be reported and corrected promptly

Note: In order to facilitate operationalization of the Safety Principles, a separate document has

been prepared, which covers:

a) Safety Principles

b) Success Criteria

c) Illustrative KPI

This document will form the basis for the concerned Line / Organizations in developing KPI's for

their respective functions / sites.

Scope of Application

This section defines the scope of application of this Policy (where, when and to

whom is this Policy applicable).

Where does this policy apply?

. All own/leased sites – Manufacturing, Research/Innovation, Offices, Depots,

Warehouses

. In-house purchased services i.e. canteen, travel desk, IT implementation etc.


Who does the policy apply to?

. All employees at business anywhere

. Contractors and visitors while at our own sites

When does it apply?

. At work (our employees, contractors and visitors)

. Travel between home and work o f our employees

. Business related travel including stay out of headquarter

. All Company organized business events i.e. training programs, conferences,

business related get-togethers, annual sports etc.

Implementation Responsibility

HUL Management at all levels is responsible for Policy implementation. Every site

shall prepare a responsibility matrix with respect to this Policy. Such SHE

responsibilities shall form an integral part of overall job responsibilities of all

employees.

All Unilever and HUL Standards, Rules and Procedures on Occupational Safety

and Health, including those that may be specific to a site are integral to this Policy

and its implementation. All employees are required to ensure strict adherence.

Quality is fundamental to our Business Success

Unilever’s mission is to meet everyday needs for nutrition, hygiene and personal

care with brands that help people feel good, look good and get more out of life.

And a key requirement is building in the quality expectations of our consumers

into our products. To win consumers’ confidence and loyalty, we need to consistently deliver

branded products of excellent quality. We understand the different needs of our consumers and

customers and strive to develop and deliver superior brands to

ensure that they’re the preferred choice. And by applying consistently high standards, we’re able

to do things right first time, cut waste, reduce costs and drive profitability.

Our Quality Policy describes the principles that everyone in Unilever follows,

wherever t hey are in the world, to ensure that we are recognized and trusted for our


integrity, the quality of our brands and products, and the high standards we set.

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 p licy. 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 we’ve forged effective working relationships with

suppliers and contract manufacturers.

• Building and maintaining excellent systems to ensure the quality and safety

of our products

We’re proactively and continuously developing our systems and processes to

ensure quality and safety throughout the whole value chain, and we’re setting a

bench mark 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.

We actively promote our Quality Policy and have a quality assurance organization

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.

CHAPTER 8.SWOT ANALYSIS


SWOT ANALYSIS

STRENGTH

Variety of products

Distribution Network

Brand image

Quality Management

Innovation and R&D strength

THREATS

From High Class Competitor

Proctor & Gamble

Pantene

Dabur

Babool

Dabourlal Dent Manjan

Reckitt Benckiser


Dettol

Palmolive

Colgate, Nirma

OPPORTUNITIES

Huge Market

Increasing per capital income

Increasing consumption pattern

Potential for making more impact of brand image.

Coming in technology e.g. in water purifiers

WEAKNESS

Not able to compete with local competitor in the rural market

Not focus on upper class population

Pricing policy is not good


Chapter 9Forecasting methods


Forecasting

Forecasting is the process of making statements about events whose actual outcomes (typically)

have not yet been observed. A commonplace example might be estimation of some variable of

interest at some specified future date. Prediction is a similar, but more general term. Both might

refer to formal statistical methods employing time series, cross-sectional or longitudinal data, or

alternatively to less formal judgemental methods. In any case, the data must be up to date in

order for the forecast to be as accurate as possible.[1] Usage can differ between areas of

application: for example in hydrology, the terms "forecast" and "forecasting" are sometimes

reserved for estimates of values at certain specific future times, while the term "prediction" is

used for more general estimates, such as the number of times floods will occur over a long

period.

Time series methods

• Time series forecasting models try to predict the future based on past data.

• You can pick models based on:

1. Time horizon to forecast

2. Data availability

3. Accuracy required

4. Size of forecasting budget

5. Availability of qualified personnel


http://en.wikipedia.org/wiki/Future

http://en.wikipedia.org/wiki/Hydrology

http://en.wikipedia.org/wiki/Forecasting#cite_note-0

http://en.wikipedia.org/wiki/Longitudinal_study

http://en.wikipedia.org/wiki/Cross-sectional_data

http://en.wikipedia.org/wiki/Time_series

http://en.wikipedia.org/wiki/Prediction

http://en.wikipedia.org/wiki/Approximation

Time series methods use historical data as the basis of estimating future outcomes.

weighted moving average?

When using a moving average method described before, each of the observations used to

compute the forecasted value is weighted equally. In certain cases, it might be beneficial to put

more weight on the observations that are closer to the time period being forecast. When this is

done, this is known as a weighted moving average technique. The weights in a weighted MA

must sum to 1.

Weighted MA(3) = Ft+1 = wt1(Dt) + wt2(Dt-1) + wt3(Dt-2)

Advantages:

It is simpler when compared to trend method by the principle of least squares.

It is elastic. If a couple of values are added in the data towards the end, due to availability

of latest data, the moving averages would change only towards the end of the data and

can be easily calculated.

It provides a true indicator of inherent trend in the data.

If the data is available on monthly or quarterly basis, moving totals on yearly basis

remove the seasonality from the data.

Disadvantages:

Trend values cannot be found in the beginning and towards the end of the data.

Moving average values are not amenable to mathematical treatment for forecasting trend

values obtained by method of least squares.


http://en.wikipedia.org/wiki/Time_series

Trend analysis

Trend Analysis is the practice of collecting information and attempting to spot a pattern, or

trend, in the information. In some fields of study, the term "trend analysis" has more formally

defined meanings.

Although trend analysis is often used to predict future events, it could be used to estimate

uncertain events in the past, such as how many ancient kings probably ruled between two dates,

based on data such as the average years which other known kings reigned.

Past data is used to make future predictions .

Known or Independent variables are used for predicting Unknown or dependent variables,

using the trend equation- “ Predictive analysis”

Based on trend equation, we find ‘Line of Best Fit’ and then it is , projected in a scatter

diagram, dividing points equally on both sides.

TREND EQUATION

Y^ = a + bX + E

Y^ = Estimated value of Y

a = Constant or Intercept

b = slope of trend line


X = independent variable

E = Error term

The slope, B , indicates the average rate of change in the hydrologic characteristic during each

year of the time period. If the slope is significantly different from zero, the trend in the

hydrologic variable is equal to the magnitude of the slope and the direction of the trend is

defined by the sign of the slope: increasing if the sign is positive and decreasing if the sign is

negative. If the slope is not significantly different from zero, there is no trend in the hydrologic

variable.

One advantage of this method of trend analysis is that it is easy to apply to a large number of

sites. A disadvantage is that it can fail to detect trends that are nonlinear but still monotonic

(generally in one direction). Other methods, such as the Mann-Kendall test, could be used to

detect trends that are monotonic but not necessarily linear, but these only indicate the direction,

and not the magnitude, of significant trends.


CHAPTER10

CALCULATIONS


Demand Forecasting for Surf Excel Sachet For the year 2011-12 using Moving Average Method

Year 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12Jan 5.76 8.2 8.5 9.33 11.66 14.84Feb 6.6 9.6 9.6 9.45 10.98 14.97Mar 4.9 7.1 7.9 8.66 9.8 15.08Apr 5.75 8.6 8.9 8.45 12.38 14.96May 5.5 8.6 7.1 9.48 10.38 15Jun 6.3 7.9 9.4 7.89 12.66 15.01Jul 4.7 9.9 8.5 8.95 13.02 14.99Aug 7.1 10.6 8.1 9.02 11.11 15Sept 6.8 11.1 7.8 10.04 13.09 15Oct 7 9.7 11 9.75 14.45 14.99Nov 6.3 10.8 9.8 10 14.62 14.99Dec 6.29 12.3 6.2 10.98 15.45 14.99Total 73 120 102 112 152 179.82

Demand Forecasting for the year 2011-12 using Trend Projection Method

Month Month(t) Sales(Yt-Observed Data) Yt*t t2 Forecasted SalesJan 1 11.66 11.66 1 10.265Feb 2 10.98 21.96 4 10.655Mar 3 9.8 29.4 9 11.045Apr 4 12.38 49.52 16 11.435May 5 10.38 51.9 25 11.825Jun 6 12.66 75.96 36 12.215Jul 7 13.02 91.14 49 12.605Aug 8 11.11 88.88 64 12.995Sept 9 13.09 117.81 81 13.385Oct 10 14.45 144.5 100 13.775Nov 11 14.62 160.82 121 14.165Dec 12 15.45 185.4 144 14.555Total 78 149.63 1029 650 148.92


CHAPTER 11.

CONCLUSION


CONCLUSION

Forecasts are vital to every business organization and for every significant management decision.Forecasting is the basis of corporate long-run planning.

In Finance and accounting, it provides the basis for budgetary planning and cost control.

Marketing relies on sales forecasting to plan new products, compensate sales personnel and make other key decision.

Production and operation personnel use forecasts to make periodic decision involving process selection, capacity planning and facility layout, as well as for continual decision about production, planning, scheduling and inventory.

Hence we have found from the sales of past five years data ,there is little fluctuation in sales amount from last continuous years so When the demand for a product is neither growing or declining rapidly, and if it does not have seasonal characteristics, a moving average can be useful in removing the random fluctuations for forecasting and Trend projection method is applicable to time series that shows consistent increase or decrease in value over time and exhibit and long-term linear trend.


BIBLIOGRAPHY

http://www.hul.co.in/

HUL Annual report.

QUANTATITIVE TECHNIQUES BY N.D.VOHRA

http://en.wikipedia.org/wiki/Hindustan_Unilever

http://en.wikipedia.org/wiki/Demand_forecasting


http://en.wikipedia.org/wiki/Hindustan_Unilever

http://www.hul.co.in/

Final docDEMAND FORECASTING OF HUL

Business

raw material

brooke bond

hindustan

personal care

personal care

people feel

skin care

brooke bond