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Hindustan Unilever Ltd.
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INTRODUCTIONINTRO
India's largest Fast Moving Consumer Goods company with 80 factories across
India.
In 1931, first Indian subsidiary, Hindustan Vanaspati Manufacturing Company,followed by Lever Brothers India Limited (1933) and United Traders Limited (1935).
HUL formed in November 1956;
The Anglo-Dutch company Unilever owns a majority stake in HindustanUnilever Limited.
The mission add vitality to life.
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Contd..
Sales growth in 2008-09 is 15.5%
Operating margin increased by 0.4% from14% to 14.4% in the year 2008-09
Gross sales is 21649.51 crores
Share price Rs237.50
HUL is the market leader in the soap
segment in India
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STRATEGIC THINKING
VISION:HUL's vision is to continuously innovate technologies to further
reduce water consumption and further increase conservation inits operations. Simultaneously, HUL sites will progressivelyhelp communities, wherever required, to develop watersheds.
MISSION OF HUL:
Unilever's mission is to add Vitality to life. We meet everydayneeds for nutrition, hygiene, and personal care with brands thathelp people feel good, look good and get more out of life.
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CORPORATE PUPROSE
Unilever's mission is to add Vitality to life. We meet everydayneeds for nutrition; hygiene and personal care with brandsthat help people feel good, look good and get more out oflife.
Our deep roots in local cultures and markets around the worldgive us our strong relationship with consumers and are thefoundation for our future growth. We will bring our wealthof knowledge and international expertise to the service oflocal consumers - a truly multi-local multinational.
Our long-term success requires a total commitment toexceptional standards of performance and productivity, toworking together effectively, and to a willingness toembrace new ideas and learn continuously.
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PRODUCT SEGMENTATION OF HUL
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0%
10%
20%
30%
40%
50%
60%
70%
80%
HUL
MP I
MP I IV SI UA I N F HUL WI H I S MP I S
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Competitors of HUL SOAPS
HUL brands
Lux
Rexona
Breeze
Lifebuoy
Pears
Dove
Hamam
Competitors brands
Santoor, Chandrika
Cinthol, Mysore Sandal
Godrej no. 1, Nirma
Dettol
Santoor,
Camay
Margo
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57%
55% 55%
52%
10%9%
8% 8%9%
5%
HULs SOAP MARKETSHARE
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SWOT ANALYSISStrengths:
Strong brand portfolio, price, quantity & variety.
Innovative Aspects.
Presence of Established distribution networks in
both urban and rural areas.3400 distributers
16 million outlets over the world.
700 million customer base.
Strong R&D of the company Highly skilled human resource.
Corporate Social Responsibility (CSR)
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Weaknesses:Strong Competitors.
High advertising costs
Complex supply chain configuration, unwieldy number. Of SKUs with
dispersed
manufacturing locations.
Price positioning in some categories allows for low price competition.
Opportunities:
Large domestic market over a billion population.
Untapped rural market.
Changing Lifestyles & Rising income levels, i.e.
increasing per capita income of consumers.
Threats: Tax and regulatory structure.
Mimic of brands
Entry of ITC in FMCG sector.
Increasing cost of raw material
SWOTAnalysis
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PORTERS FORCES
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RIVALS
Consumer in this category enjoy
multitude of choices.
It does not cost anything for a
consumer to buy one brand of
shampoo instead of another, makingthe industry quite competitive.
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SUPPLIERS
Consumer product faces some amount ofsupplier power simply because of the
cost they incur when switching suppliers
Suppliers that do a large amount of
business with these companies are alsobeholden to their customers.
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BUYERS(CUSTOMERS)
Consumer faces weak buying powerbecause customers are fragmented and
have little influence on price or
product.
Considering buyer power retailers it is
very high since they are able tonegotiate the price with the companies.
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POTENTIAL ENTRANTS
Given the amount of capital investmentneeded to enter certain segment inhouse hold consumer products, thethreat of new entrant is fairly low.
Whether the new entrant can get itsproducts on the shelves of the sameretailers as its much larger rivals.
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THREAT OF SUBSTITUTE
Within the consumer product industry, brand
succeeds in helping to build a competitive
advantage, but even the pricing power of
the brands can be eroded.
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PESTANALYSIS
POLITICAL Legislation such as the minimum wage or anti discrimination
laws.
Voluntary codes and practices
Market regulations
Trade agreements, tariffs or restrictions
Tax levies and tax breaks
Type of government regime eg communist, democratic,
dictatorship
ECONOMICAL
Recession will have high unemployment, low spending
power and low stakeholder confidence
Cheaper labour in developing countries affects the
competitiveness of products from developed countries
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SOCIAL Changes in the structure of a population will affect the supply and
demand of goods and services within an economy.
Falling birth rates will result in decreased demand and greatercompetition as the number of consumers fall.
Organisationsmust be able to offer products and services that aim tocomplement and benefit peoples lifestyle and behavior.
TECHNOLOGICAL
Advanced technology for manufacturing process which give low costadvantage.
Technology infrastructure such as the internet and other informationexchange systems including telephone
Technology systems incorporating a multitude of software whichhelp them manage their business.
Technology hardware such as mobile phones, Blackberrys, laptops,desktops, Bluetooth devices, photocopiers and fax machines whichtransmit and record information.
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STRATEGIES FOLLOWED AT HUL
Distribution strategy.Distribution network (direct selling)
Brand extension strategy
Line extension strategy
Repositioning strategy
Promotional strategy-ads,(Rs700-800 cr)Segmentation strategy
Premium brand
Affordable brand
Value for moneyInnovation strategy-introduction of sachet in shampoo
Mergers and acquisitions strategy
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Thank U