1. BRIEF HISTORY
Over 100 years' link with India. In 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 1895 and other famous brands like Pears, Lux and Vim. Vanaspati
was launched in 1918 and the famous Dalda brand came to 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 51.55% equity
in the company. The rest of the shareholding is distributed among about 380,000 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.
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2. 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 Lever Limited, 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, Nepal Lever Limited (NLL), and its factory represents the largest
manufacturing investment in the Himalayan kingdom. The NLL 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 Icecream 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 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
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3. Wall's range of Frozen Desserts. By the end of the year, the company entered into a strategic
alliance with the Kwality Icecream Group families and in 1995 the Milkfood 100% Icecream
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 Group,
benefits from scale economies 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 Pasteurised Crabmeat business of the Amalgam
Group of Companies, a leader in value added Marine Products exports.
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4. COMPANY PROFILE
Hindustan Unilever Limited
Type Public
Founded 1933
Headquarters Mumbai, India
Harish Manwani Chairman
Key people
Nitin Paranjpe, CEO
Industry Fast moving consumer goods
Products tea, soap, detergents
Employees 41,000
Parent Unilever
Website www.HUL.com
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5. Hindustan Unilever Limited (abbreviated to HUL), formerly Hindustan Lever Limited , is
India's 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.
Unilever's mission 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 51.55% of the equity. The rest of the shareholding is distributed
among 380,000 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 in close to 80 factories. The operations involve over 2,000 suppliers and
associates. HUL's distribution network, comprising about 7,000 redistribution stockists,
directly covers 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 Lever Research Centre (HLRC) was set up in 1958, and now has
facilities in Mumbai and Bangalore. HLRC and the Global Technology Centres 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 organisation'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 through 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.
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6. Over the last three years the company has embarked on an ambitious programme, Shakti. Through
Shakti, HUL is creating micro-enterprise opportunities for rural women, thereby 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 programme now covers about 50,000
villages in 12 states. HUL's vision is to take this programme to 100,000 villages impacting the
lives of over a 100 million rural Indians.
HUL is also running a rural health programme – Lifebuoy Swasthya Chetana. The programme
endeavtheirs to induce adoption of hygienic practices among rural Indians and aims to bring
down the incidence of diarrhoea. It has already touched 70 million people in approximately
15000 villages of 8 states. The vision is to make a billion Indians feel safe and secure. If
Hindustan Lever 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.
CORPORATE PURPOSE
Unilever's mission is to add Vitality to life. We meet everyday needs for nutrition , hygiene and
personal care with brands that help people feel good, look good and get more out of life.
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7. Our deep roots in local cultures and markets around the world give us our strong relationship with
consumers and are the foundation for our future growth. We will bring our wealth of knowledge
and international expertise to the service of local consumers - a truly multi-local multinational.
Our long-term success requires a total commitment to exceptional standards of performance and
productivity, to working together effectively, and to a willingness to embrace new ideas and learn
continuously.
To succeed also requires, we believe, the highest standards of corporate behaviour towards
everyone we work with, the communities we touch, and the environment on which we have an
impact.
This is our road to sustainable, profitable growth, creating long-term value for our shareholders,
our people, and our business partners.
MANAGEMENT STRUCTURE
Hindustan Unilever Limited is India's largest Fast Moving Consumer Goods (FMCG) Company. It
is present in Home & Personal Care and Foods & Beverages categories. HUL and Group
companies have about 16,000 employees, including 1200 managers.
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8. The fundamental principle determining the organization structure is to infuse speed and flexibility
in decision-making and implementation, with empowered managers across the company’s
nationwide operations.
BOARD
The Board of Directors as repositories of the corporate powers act as a guardian to the Company as
also the protectors of shareholder’s interest.
This Apex body comprises of a Non- Executive Chairman, four whole time Directors and five
independent Non – Executive Directors. The Board of the Company represents the optimum mix
of professionalism, knowledge and experience.
MANAGEMENT STRUCTURE
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9. Mr Harish Manwani
Chairman
Mr. Douglas Baillie - Mr. D Sundaram – Mr. Nitin Paranjpe –
Chief Executive Officer Director Finance Executive Director
and Managing Director and IT Home & Personal Care
Mr. Shreejit Mishra – Mr. Sanjiv Kakkar – Mr. Dhaval Buch –
Executive Director Executive Director Executive Director
Foods Sales and Customer Development Supply Chain
Mr. Ashok Gupta – Ms Leena Nair –
Executive Director Executive Director
Legal HR.
HINDUSTAN UNILEVER LIMITED INDIA’S LARGEST FMCG
COMPANY
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16. CODE OF BUSINESS PRINCIPLES
MISSION:
Hindustan Unilever Limited mission is to add strength to life. We meet everyday needs for
nutrition, hygiene, and personal care with brands that help people feel good, look good and get
more out of life.
INTRODUCTION
HUL has earned a reputation for conducting its business with integrity and with respect for
the interests of those their activities can affect. This reputation is an asset, just as real as
their people and brands.
Their first priority is to be a successful business and that means investing for growth and
balancing short-term and long-term interests. It also means caring about their consumers,
employees and shareholders, their business partners and the world in which we live.
From HUL Spokesperson “To succeed requires the highest standards of behavior from all of us. The general
principles contained in this Code set out those standards. More detailed guidance tailored to the needs of different
countries and companies will build on these principles as appropriate, but will not include any standards less rigorous
than those contained in this Code.
We want this Code to be more than a collection of high-sounding statements. It must have practical value in their day-
to-day business and each one of us must follow these principles in the spirit as well as the letter”. ref: business
world magazine.
CODE OF BUSINESS PRINCIPLES
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17. STANDARD OF CONDUCT
We conduct our operations with honesty, integrity and openness, and with respect for the human
rights and interests of our employees.
We shall similarly respect the legitimate interests of those with whom we have relationships.
OBEYING THE LAW
HUL companies and employees are required to comply with the laws and regulations of the
countries in which they operate.
EMPLOYEES
• HUL is committed to diversity in a working environment where there is mutual trust and
respect and where everyone feels responsible for the performance and reputation of the
company. HUL will recruit, employ and promote employees on the sole basis of the
qualifications and abilities needed for the work to be performed.
• HUL are committed to safe and healthy working conditions for all employees. We will not
use any form of forced, compulsory or child labour.
• HUL are committed to working with employees to develop and enhance each individual's
skills and capabilities.
• HUL respect the dignity of the individual and the right of employees to freedom of
association.
• HUL will maintain good communications with employees through company based
information and consultation procedures.
CONSUMERS
HUL is committed to providing branded products and services which consistently offer value in
terms of price and quality, and which are safe for their intended use. Products and services
will be accurately and properly labelled, advertised and communicated.
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18. SHAREHOLDERS
HUL will conduct its operations in accordance with internationally accepted principles of good
corporate governance. They will provide timely, regular and reliable information on their
activities, structure, financial situation and performance to all shareholders.
BUSINESS PARTNERS
HUL is committed to establishing mutually beneficial relations with their suppliers, customers
and business partners.
In their business dealings they expect their partners to adhere to business principles
consistent with their own.
COMMUNITY INVOLVEMENT
HUL strives to be a trusted corporate citizen and, as an integral part of society, to fulfill their
responsibilities to the societies and communities in which they operate.
PUBLIC ACTIVITIES
HUL companies are encouraged to promote and defend their legitimate business interests.
HUL will co-operate with governments and other organizations, both directly and through
bodies such as trade associations, in the development of proposed legislation and other
regulations which may affect legitimate business interests.
HUL neither supports political parties nor contributes to the funds of groups whose activities
are calculated to promote party interests.
THE ENVIRONMENT
HUL is committed to making continuous improvements in the management of their
environmental impact and to the longer-term goal of developing a sustainable business.
HUL will work in partnership with others to promote environmental care, increase
understanding of environmental issues and disseminate good practice.
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19. INNOVATION
In their scientific innovation to meet consumer needs they will respect the concerns of their
consumers and of society. They will work on the basis of sound science, applying rigorous
standards of product safety.
COMPETITION
HUL believes in vigorous yet fair competition and supports the development of appropriate
competition laws. Their companies and employees will conduct their operations in accordance
with the principles of fair competition and all applicable regulations.
BUSINESS INTEGRITY
HUL does not give or receive, whether directly or indirectly, bribes or other improper
advantages for business or financial gain. No employee may offer, give or receive any gift or
payment which is, or may be construed as being, a bribe. Any demand for, or offer of, a bribe
must be rejected immediately and reported to management.
HUL accounting records and supporting documents must accurately describe and reflect the
nature of the underlying transactions. No undisclosed or unrecorded account, fund or asset
will be established or maintained.
CONFLICTS OF INTERESTS
All HUL employees are expected to avoid personal activities and financial interests which
could conflict with their responsibilities to the company.
HUL employees must not seek gain for themselves or others through misuse of their
positions.
COMPLIANCE – MONITORING – REPORTING
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20. Compliance with these principles is an essential element in their business success. The Unilever
Board is responsible for ensuring these principles are communicated to, and understood and
observed by, all employees.
Day-to-day responsibility is delegated to the senior management of the regions and operating
companies. They are responsible for implementing these principles, if necessary through more
detailed guidance tailored to local needs.
Assurance of compliance is given and monitored each year. Compliance with the Code is subject
to review by the Board supported by the Audit Committee of the Board and the Corporate Risk
Committee.
Any breaches of the Code must be reported in accordance with the procedures specified by the
Joint Secretaries. The Board of Unilever will not criticize management for any loss of business
resulting from adherence to these principles and other mandatory policies and instructions.
The Board of Unilever expects employees to bring to their attention, or to that of senior
management, any breach or suspected breach of these principles.
Provision has been made for employees to be able to report in confidence and no employee
will suffer as a consequence of doing so.
ENVIRONMENT POLICY
Hindustan Lever Limited (HUL) supplies high quality goods and services to meet the daily needs
of consumers and industry. In doing so, the Company is committed to exhibit the highest standards
of corporate behavior towards its consumers, employees, the societies and the world in which we
live.
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21. The company recognizes its joint responsibility with the Government and the Public to protect
environment and is committed to regulate all its activities so as to follow best practicable means
for minimizing adverse environmental impact arising out of its operations.
The company is committed to making its products environmentally acceptable, on a scientifically
established basis, while fulfilling consumers' requirements for excellent quality, performance and
safety.
The aim of the Policy is to do all that is reasonably practicable to prevent or minimize,
encompassing all available knowledge and information, the risk of an adverse environmental
impact arising from processing of the product, its use or foreseeable misuse.
This Policy document reflects the continuing commitment of the Board for sound Environment
Management of its operations. The Policy applies to development of a process, product and
services, from research to full-scale operation. It is applicable to all company operations covering
its plantations, manufacturing, sales and distribution, research & innovation centers and offices.
This document defines the aims and scope of the Policy as well as responsibilities for the
achievement of the objectives laid down.
THE VISION
Their vision is to continue to be an environmentally responsible organization making continuous
improvements in the management of the environmental impact of their operations.
HUL will achieve this through an Integrated Environment Management approach, which focuses
on People, Technology and Facilities, supported by Management Commitment as the prime driver.
INVESTMENT BEHIND BRANDS
Innovation & Superior Quality
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22. Family – safe Petalsoft Water & effort saving Quick wash - 50% No mud Rin
Advance from germs
Perfect Radiance “5 in 1” hair Total Care Whiter teeth Fresher breath
BRANDS
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25. COLOUR COSMETICS
• Lakme
AYURVEDIC PERSONAL AND HEALTH CARE
• AYUSH
FOODS
TEA
• Brooke Bond
• Lipton
COFEE
• Brooke Bond Bru
FOODS
• Kissan
• Annapurna
• Knorr
ICE-CREAM
• Kwality Wall’s
DIRECT SELLING:
PRODUCT RANGE
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26. • Lever home range
• Male grooming
• Oral Care
• Ayurveda
• Personal Wash
• Foods
Reach - 1400 towns (Largest in India)
Consultant base - 330,000
ACCORDINGLY,
HUL'S AIMS ARE TO:
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27. 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 annual improvement objectives and targets
and review these to ensure that these are being met at the individual unit and corporate levels.
Reduce Waste, conserve Energy and explore opportunities for reuse and recycle.
Involve all employees in the implementation of this Policy and provide appropriate training.
Provide for dissemination of information to employees on environmental objectives and
performance through suitable communication networks.
Enctheirage 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 practice.
RESPONSIBILITIES
Corporate
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28. The Board and the Management Committee of HUL is committed to conduct the company
operations in an environmentally sound manner. The Management Committee will:
Set mandatory standards and establish environmental improvement objectives and targets for HUL
as a whole and for individual units, and ensure these are included in the annual operating plans.
Formally review environment performance of the company once every quarter.
Review environment performance when visiting units and recognise exemplary performance.
NOMINATE:
- A senior line manager responsible for environmental performance at the individual HUL site.
- HUL environmental coordinator.
The Management Committee, through the nominated environmental coordinator will:
Ensure implementation of HUL Policy on environment and compliance with Unilever and HUL
environmental standards and the standards stipulated under relevant national / local legislation.
When believed to be appropriate, apply more stringent criteria than those required by law.
Assess environmental impact of HUL operations and establish strategies for sound environment
management and key implementation steps.
Enctheirage development of inherently safer and cleaner manufacturing processes to further raise
the standards of environment performance.
Establish appropriate management systems for environment management and ensure regular
auditing to verify compliance.
Establish systems for appropriate training in implementation of Environment Management
Systems at work.
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29. Ensure that all employees are made aware of individual and collective responsibilities towards
environment.
Arrange for expert advice on all aspects of environment management.
Participate, wherever possible, with appropriate industry and Government bodies advising on
environmental legislation and interact with national and local authorities concerned with protection
of environment.
INDIVIDUAL UNITS
The overall responsibility for environment management at each unit will rest with the Unit Head,
who will ensure implementation of HUL Policy on environment at unit level. Concerned line
managers / heads of departments are responsible for environmental performance at department
levels.
In order to fulfill the requirements of the Environment Policy at each site, the Unit Head will:
Designate a unit environment coordinator who will be responsible for co-ordinating environmental
activities at unit, collating environmental statistics and providing / arranging for expert advice.
Agree with the Management Committee Member responsible for the unit, specific environmental
improvement objectives and targets for the unit and ensure that these are incorporated in the annual
objectives of the concerned managers and officers and are reviewed periodically.
Ensure that the unit complies with Unilever and HUL mandatory standards and the relevant
national and state regulations with respect to environment.
Ensure formal environmental risk assessment to identify associated environmental aspects and take
appropriate steps to control risks at acceptable levels.
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30. Ensure that all new operations are subjected to a systematic and formal analysis to assess
environmental impact. Findings of such exercises should be implemented prior to commencement
of the activity.
Manage change in People, Technology and Facilities through a planned approach based on
training, risk assessment, pre-commissioning audits and adherence to design codes.
Regularly review environment performance of the unit against set objectives and targets and strive
for continual improvement.
Sustain a high degree of environmental awareness through regular promotional campaigns and
employee participation through training, safety committees, emergency drills etc.
Ensure dissemination of relevant information on environment within the unit and to outside bodies,
and regularly interact with Government authorities concerned for protection of environment.
Maintain appropriate emergency procedures consistent with available technologies to prevent /
control environmental incidents.
Provide appropriate training to all employees.
Ensure periodic audits to verify compliance with environment management systems and personally
carry out sample environment audits to check efficacy of the systems.
Report environmental statistics to HUL Corporate Safety & Environment Group on a monthly
basis.
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31. RESEARCH AND INNOVATION CENTERS
Since most new products and processes are developed in these Units, certain additional
responsibilities devolve on them to ensure implementation of the Environment Policy of the
company. In addition to the Unit Head's responsibilities outlined above, the heads of these units
will:
Ensure that a formal and systematic risk assessment exercise is undertaken during the
process/product development stage with specific reference to environmental impact.
Transfer technology to the pilot plant and main production through a properly documented process
specification which will clearly define environmental impact and risks associated with processes,
products, raw material and finished product handling, transport and storage.
Ensure that treatment techniques are developed for any wastes generated as a result of the new
product/process and is incorporated into the process specifications.
QUALITY POLICY:
Hindustan Lever Limited considers quality as one of the principal strategic objectives to guarantee
its growth and leadership in the markets in which it operates.
The company is committed to respond creatively and competitively to the changing needs and
aspirations of their consumers through relentless pursuit of technological excellence, innovation
and quality management across their businesses, and offer superior quality products and services
that are appropriate to the various price points in the market as well as to their commitment to
building shareholder value.
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32. The company recognizes that its employees are the primary stheirce of success in its operations
and is committed to training and providing them the necessary tools and techniques as well as
empowering them to ensure broad base compliance of this policy in the organization at all levels.
The company is committed to fulfill its legal and statutory obligations and international standards
of product safety and hygiene and will not knowingly sell product that is harmful to consumers or
their belongings. It will institute systems and measures to monitor compliance in order to meet its
responsibilities to consumers.
The company will maintain an open communication channel with its consumers and customers and
will carefully monitor the feedback to continuously improve its products and services and set
quality standards to fulfill them. The company is committed to extend its quality standards to its
contract manufacturers, key suppliers and service providers and by entering into alliances with
them, to jointly improve the quality of its products and services. This policy is applicable to
production from its own facilities as well as to production that is outsourced.
The company will periodically review this quality policy for its effectiveness and consistency with
business objectives.
The company delegates authority and responsibility for dissemination and implementation of this
policy to each Business and Unit Head.
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34. SAFETY AND HEALTH POLICY
INTRODUCTION
Hindustan Lever Limited (HUL) supplies high quality goods and services to meet the 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.
THEIR VISION
Their vision is to be an injury free organization.
HUL NEWS:”We will bring safety on top of mind for all employees and will integrate it with all
business processes. We will realize their Vision through an Integrated Safety Management
approach, which focuses on People, Processes, Systems, Technology and Facilities, supported by
demonstrated leadership and employee commitment at all levels as the prime drivers for ensuring a
safe and healthy work environment”.
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35. 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
All deficiencies must be reported and corrected promptly
In order to facilitate operationalisation of the Safety Principles, a separate document has been
prepared, which covers:
a) Safety Principles
b) Success Criteria
c) Illustrative KPI
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36. Consumer satisfaction
Indira is 20 years old, a tribal woman at Kondegaon village in Bastar district. She is just back from
the nearby jungles, collecting firewood. After attending to her baby son, she will go to the village
well to take a quick wash. Yesterday her husband brought her a white soap, with pink petals in it.
Indira had requested him to buy one, for the festival later this evening.
Indira is among millions of consumers in rural India who use Hindustan Lever's products. She
came to know about Lux through the TV set at the community centre. It is not very costly, and also
available nearby.
Home to over 700 million people, rural India comprises not only over 70% of India's billion-strong
population, but also over 12% of the world's population. The rural population already accounts for
substantial consumption of Fast Moving Consumer Goods and also consumer durables. About 50%
of the sales of soaps & detergents are generated in rural India. Similarly, almost half the demand
for black & white television sets, pressure cookers, table fans, sewing machines also comes from
there.
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37. COST MANAGEMENT:
But the potential is even larger, both in terms of consumption and penetration. The fact that 70% of
the population accounts for only 50% of even relatively well-penetrated categories, like soaps &
detergents, indicates the enormous scope of consumption-led growth in these categories. Therefore
such categories will derive growth out of increased usage. In categories, which are relatively less
penetrated, like personal products, rural India offers an even bigger growth opportunity through
greater penetration and then consumption. For example only three out of 10 consumers in rural
markets use shampoo or skin care products. Therefore growth in such categories will emerge, as
more consumers purchase these products, and then continue to use them regularly.
Hindustan Lever has taken many initiatives over the decades to create markets in the rural
hinterlands. By marketing relevant products, at affordable prices.
At the same time, if products have to come up the order in the rural purchase hierarchy, they have
to be affordable. If rural India today accounts for about half of detergents sales, it is because HUL
has developed low-cost value-for-money branded products, like Wheel. The company has also
taken initiatives to create markets even for apparently premium products, by offering them in pack
sizes, like sachets, whose unit prices are within the reach of rural consumers. For example,
initiated in the 1980s, sachets (Rs.2, Re.1, or 50 paise) today constitute about 55% of Hindustan
Lever's shampoo sales. With media reach gradually increasing, rural consumers today, where the
media has its footprints, share the same aspirations with their urban counterparts. HUL has
responded to the trend with low unit price packs of even other products - Lux at Rs.5, Lifebuoy at
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38. Rs.2, Surf Excel sachet at Rs.1.50, Pond's Talc at Rs.5, Pepsodent toothpaste at Rs. 5, Fair &
Lovely Skin Cream at Rs.5, Pond's Cold Cream at Rs.5, Brooke Bond Taaza tea at Rs.5.
OTHER MARKETING STRATEGIES:
For decades now, Hindustan Lever has also taken initiatives to circumvent the limitation in
communication channels, by innovatively leveraging non-conventional media. Among them are
wall paintings, cinema vans, weekly markets (haat), fairs and festivals. Given the rural consumer's
fascination for cinema, the cinema vans show popular movies, interspersed with products
advertisements. Weekly markets, fairs and festivals are parts and parcel of rural life. They give an
opportunity to address consumers, spread over many tiny hamlets, at one location. The occasions
are used to demonstrate product benefits and also sell such products. Such demonstrations have
played a significant role in creating, for example, the detergents market in rural India. In recent
times, such demonstrations are being deployed to illustrate how visible clean is not hygienic clean,
and how using soap is essential to prevent easily avoidable infections.
Communication through fairs and festivals are backed by direct consumer contact. For example, in
1998-99, Hindustan Lever implemented a major direct consumer contact, called Project Bharat,
which covered 2.2 crore homes. Each home was given a box, at a special price of Rs.15,
comprising a low unit price pack of shampoo, talcum powder, toothpaste and skin cream, along
with educational leaflets and audio-visual demonstrations. The project has helped eliminate
barriers to trial, and has strengthened salience of both particular categories and brands. Similarly in
2002, Hindustan Lever has launched a similar large-scale direct contact, called Lifebuoy Swasthya
Chetana, which already covers 70 million people in 18,000 villages of 8 states. The project is
intended at generating awareness about good health and hygiene practices, and specifically how a
38
39. simple habit of washing hands is essential to maintaining good health. The initiative will involve
interaction with students and senior citizens, who act as change agents.
AVAILABILITY OF HUL’S PRODUCT:
Generating awareness pays dividends only when steps are taken to ensure constant availability of
products. In rural India particularly, availability determines volumes and market share, because the
consumer usually purchases what is available at the outlet, influenced very largely by the retailer.
Therefore, over the decades, Hindustan Lever has progressively strengthened its distribution reach
in rural India, which today has about 33 lakh outlets. Direct rural distribution in Hindustan Lever
began with the coverage of villages adjacent to small towns. The company's stockists in these
towns were made to use their infrastructure to distribute products to outlets in these villages. But
this distribution mode could only be extended to villages connected with motorable roads, and it
could cover about 25% of the rural population by 1995.
Therefore in 1998, Hindustan Lever launched Project Streamline to further extend its distribution
reach. Under this initiative, the company identifies sub-stockists in a large village, connected by
motorable road to a small town. This sub-stockist in turn distributes the company's products to
outlets in adjacent smaller villages using transportation suitable to interconnecting roads, like
cycles, scooters or the age-old bullock cart. Hindustan Lever is thus trying to circumvent the
barrier of motorable roads. As a result, the distribution network, as of now, directly covers about
50,000 villages, reaching about 250 million consumers. The company simultaneously uses the
wholesale channel, suitably incentivising them to distribute company products.
39
40. HUL has in the recent past established a common distribution system in rural areas for all its
products. Given the number of brands and their packs the rural retailer usually requires, one HUL
representative can take all the products from the company portfolio that he needs. This common
distribution system is now fully operational, under one Regional Sales Manager exclusively
dedicated to rural markets of each region of the country.
Over time, Hindustan Lever will further strengthen its rural distribution through mutually
beneficial alliances with rural Self Help Groups (SHGs). Over the last five years, financial
institutions, NGOs and government organizations are working closely to establish SHGs, whose
objective is to alleviate poverty through sustainable income-generating activities. Since 2001,
Hindustan Lever is implementing Project Shakti, whereby SHGs are being offered the option of
distributing relevant products of the company as a sustainable income-generating activity. The
model hinges on a powerful win-win relationship; the SHG engages in an activity which brings
sustainable income, while Hindustan Lever gets an interface to interact and transact with the rural
consumer. HUL's vision for Project Shakti is to scale it up across the country by 2005, creating
about 25000 Shakti entrepreneurs, covering 100,000 villages, and touching the lives of 100 million
rural consumers. Begun with 50 groups in Nalgonda district of Andhra Pradesh, with the support
of local authorities, the project has been extended, as of now, to about 50,000 villages in 12 states.
A typical Shakti entrepreneur conducts business of around Rs.10,000 - Rs 15,000 per month,
which gives her an income of about Rs 700 - Rs.1000 per month on a sustainable basis. As most of
these women are from below the poverty line, and live in extremely small villages (less than 2000
population), this earning is very significant, and is almost double of their past household income.
The full benefit of Project Shakti will be realised after some years.
40
41. GROWTH AND ACHIEVEMENTS:
1930
1888, less than four years after William Hesketh Lever launched Sunlight Soap in England, his
newly-founded company, Lever Brothers, started exporting the revolutionary laundry soap to
India. By the time the company merged with the Netherlands-based Margarine Unie in 1930 to
form Unilever, it had already carved a niche for itself in the Indian market. Coincidentally,
Margarine Unie also had a strong presence in India, to which it exported Vanaspati (hydrogenated
edible fat).
1933
- Incorporated on 17th October, under the name of a Lever Brothers (India) Pvt., Ltd. (LBIL) was
the wholly owned subsidiary of Unilever Ltd. London, UK.
- 1933 Lever Brothers India Limited (LBIL) incorporated in India to manufacture Soaps.
1935
- On 11th May a subsidiary Co. was incorporated under the name United Traders Pvt. Ltd. for
marketing the products of the Co. or imported from the parent Co.
1956 -
- On 27th October, the Company was converted into a Public Ltd. Co.
- On 1st November, Hindustan Vanaspati Mfg. Co. Pvt. Ltd., William Gossage & Sons (India) Pvt.
Ltd. and Joseph Crosfield & Sons Unilever Ltd. were amalgamated with LBIL and the name was
changed to Hindustan Lever Ltd. From 23rd october onwards activities of subsidiary Co. were
taken over by its holding Co.
- On 17th November Unilever Ltd. Offered to the public 557,000 No. of equity shares of Rs.10
each.
1976
- The company had set up plants at Taloja in Maharshtra for the manufacture of ossein and di-
calcium phosphate. In August these plants were commissioned.
41
42. 1980
- In order to reduce the non-resident holding in the Co. to 51%, Uniliver Ltd. offered for sale
during Feb. out of its shareholding in the Co. 4239523 No. of equity shares of Rs.10 each at a
premium of Rs.9.50 per share in the following manner;
- i) 10,00,000 shares to public financial institutions. - ii) 25,12,702 shares to the existing resident
Indian shareholders on a pro-rata basis in the ratio of 1:4.
- iii) 726,821 shares to employees and Indian directors.
1983
- A new fine chemical unit was commissioned.
- As consideration, Indian shareholders of HL Ltd. were offered 62,20,576 No. of equity shares of
Rs.10 each of Lipton India Ltd., at par in proportion of 2:8. ie 2 Lipt:8 HL equity. 1985
- A project for the manufacture of 500 tonnes per day of diammonium phosphate was
commissioned.
1986
- Lux toilet soap was launched.
1987
Lifebouy Personal and Breez soaps launched.
1989
- Synthetic Detergent plant at Sumerpur in UP & Tiolet soap plant in Orai in UP were
commissioned.
- Cracking catalyst plant at Haldia commissioned.
- Vegetable oil plant commissioned at Kandla free trade zone.
1991
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43. - Company proposed to set up a 17,000 tpa. film sulphonation plant at Taloja to manufacture a
range of detergent actives.
1992
- Entered in dental product market by introducing Pepsodent, Mentadent G etc.
- A factory to manufacture leather garments and other leather based products including wool-on-
leather garments and wool-on-leather was set up in Chennai.
- The Company undertook to set up a large scale acquaculture centre at Tanjavur in Tamil Nadu
for farming and processing catfish for the U.S. markets in technical collaboration with FFDA,
Florida, USA who also provide a full buy-back guarantee.
1993
- Tata Oil Mills Co. Ltd. (TOMCO) was merged with Hindustan Lever Ltd with effect from 1st
April. As per the scheme of amalgamation, shareholders of TOMCO were allotted without
Payment in cash 2 equity shares of Rs.10 each of HL for 15 equity shares of Rs.10 each held in
TOMCO. After the amalgamation Unilever PLC London were allotted on a preferencial basis
29,84,347 equity shares of Rs.10 each at a premimium of Rs.95 per share for maintain their share
holding at 51% in the Co.
- The Company entered into joint venture agreement with Lakme Lever Ltd. to undertake the
manufacturing and distribution of colour cosmetics and other personal care products.
- The Company received the President's Award for Outstanding performance in Agri
Commodities for the year 1994-95.
1995
HUL and Indian cosmetics major, Lakme Ltd, form 50:50 joint venture, Lakme Lever Ltd. HUL
acquires Kwality and Milkfood 100% brandnames and distribution assets. - HUL and US-based
S.C. Johnson & Son Inc. form 50:50 joint venture, Lever Johnson (Consumer Products) Pvt.
Ltd.HUL Soaps and Detergent sales cross one million tonnes.
1996
- Brooke Bond India Ltd. was amalgamated with the Company. As per the scheme of
amlgamation, the Company allotted 533,28,713 equity shares to the share holders of Brooke Bond
India Ltd. in the proportion 9 shares of the company for 20 shares held in Brooke Bond India Ltd.
43
44. - The Company entered into joint venture S C Johnson & Son USA. The Joint Venture named
Lever Johnson Consumer products Pvt. Ltd.
1998
- The Directors of Hindustan Lever Limited at their meeting held on 16th March, considered and
approved the proposal for amalgamation of Ponds India Limited with Hindustan Lever Limited.
HUL's tea business is among the biggest in the world.
- HUL has signed a memorandum of understanding with Tata Housing Development Company for
developing some of its properties into residential and commercial complexes.
- HUL has a world-class information technology infrastructure to enable the businesses to respond
faster and perform better.
- Hindustan Lever Limited's Bangalore factory has received National Productivity Award for the
fourth year in a row from National Productivity Council. The factor has also received ISO 9002
certification.
1999
- Hindustan Lever Ltd (HUL), has joined hands with the Institute for Social and Economic Change
(Isec) for a rural development programme in Karnataka.
- Hindustan lever Ltd, has decided to merge its subsidiary Industrial Perfumes Ltd with the
company. The merger would be effective from January 1.
- Hindustan Lever Limited (HUL) has decided to dispose of its dairy business to Nutricia (India)
Pvt Ltd and spin off its animal and poultry feeds into a separate subsidiary.
2000
- The Company will be the largest e-tailer in the next two years.
- The Company has launched a new brand of toopaste -- Aim.
- The Company launched the International Lux Skincare range, "Sunscreen Formula".
- The Company has launched a cooking medium New Dalda Active.
- Kwality Wall's, a division of Hindustan Lever Ltd., has launched softy ice cream and has
positioned it as a mass market product and Head of the ice cream business.
44
45. - Hindustan Lever Ltd's Pepsodent toothpaste has introduced games at McDonald's outlets.
- The Company has launched the new Nutririch Fair & Lovely fairness reviving lotion.
2001
- HUL has over 36,000 employees, and has created 2 lakh indirect jobs. Its operations are spread
across 70 locations in India. There are over 50 factories, of which 28 are in backward areas. The
operations involve 2000 suppliers and aassociates and 7000 stockists and agents. HUL has
emerged as a major Exporter.
- Hindustan Lever has entered into a joint venture with Godrej Agrovet a subsidiary of Godrej
Soaps.
- In October 2000 HUL acting in concert with Unilever made an open tender offer for the
remaining 24.62%of the IBL equity at price Rs 173.00 per share.
2001
- The Board of Hindustan Lever Ltd (HUL) had approved the transfer of its undertaking engaged
in seeds business to its subsidiary Paras Extra Growth Seeds Ltd.
- The company has signed an agreement with ICI India, a subsidiary of ICI plc, UK, for sale of
Nickel Catalyst business and Adhesives business, a sub-unit of Specialty Chemicals Division of
the company's Chemicals and Agri operations for a consideration of Rs.21 crore and Rs 9 crores
respectively.
2002
-Opto Circuits enters into an agreement with HUL to buy the business line of Digital
Thermometers.
- Comes out from the premium (prestige) fragrances segment by stopping distribution of Calvin
Klein in the country
2003
- Ties up with Pepsi for distribution, signs a memorandum of understanding with Pepsi, to leverage
each other's strengths in distribution. The agreement provides Pepsi access to the HUL's
institutional accounts.
-HUL extended its Knorr Annapurna range into soup powders at Rs 5. Sporting flavours such as
Tomato Tease, Spicy Vegetable, Chicken Punch and Peppery Chicken
45
46. -The companty has introduced a new mango drink 'Mr Fruit'.
2004
-Relaunches Rin Shakti Powder and Rin Shakti Bar
-Mr. Harish Manwani appointed president, home and personal care, North America , a business
worth 5bn euros in sales turnover for '02
-HUL unveils new schemes to lure customers in Tamil Nadu
-Hindustan Lever Ltd has introduced its new active Gel Close Up in the market
-Hindustan Unilever launches `Perfect Radiance', range of 12 premium skincare products under
brand name Fair & Lovely on May 26, 2004
-HUL enters into kids' personal care market
-Unilever, the parent company of Hindustan Lever and one of the world's largest consumer
products companies, has set up a global sourcing arm, that will have a large presence in India to
buy products and raw materials from low-cost locations for its subsidiaries across the world
-Launches Dove Ultra Moisturizing Body Wash
-HUL inks pact with Pepsi in beverage segment
2005
-HUL introduce iced tea in glass bottles
-HUL rolls out Brooke Bond brand variation
-Mcleod Russel & HUL signs MoU
2007
-Hindustan Unilever Ltd. has appointed Mr. Ashok K. Gupta as "Officer who is in default" for the
purposes of Compliance with section 5(f) of the Companies Act, 1956.
46
47. HUL DISTRIBUTION NETWORK
MANUFACTURING UNITS ALL ACROSS INDIA
C&F 1 C&F 2 C&F 3 C&F 4 C&F 5 C&F 6 C&F 7
STOCKISTS STOCKISTS STOCKISTS STOCKISTS STOCKISTS STOCKISTS STOCKISTS
WHOLESALERS
RETAILERS
CUSTOMERS
This is the whole Distribution Chain of HUL to cover the Rural market. The company have
remarkably worked upon to make the supply chain from manufacturers to retailers simple with
very few number of mediators and jobbers. It has helped them to maintain the transparency in the
cycle and also have let them established a prompt delivery process. The products are manufactured
in the factories all across India and then is supplied from there to the various Carriage and
Forwarding (C&F) units which are 5-10 per state depending on the area they have to cover and are
established by the company. These C&F units then supply the products to the various Wholesalers
confined to their area only and according to the wholesalers demand. The wholesalers then supply
47
48. the products to the semi-wholesalers and the retailers as per the volume of their order. Then the
semi-wholesalers deliver the products to the retailers and customers.
MANUFACTURER
STAGE 1-
C&F
In this stage the products reach to the Carriage and Forwarding unit from various manufacturing
units established all across India. The volume of the delivery depends upon the quantity
required/ordered by the C&F unit. The depot sends the request of the volume of the products to the
Head Office, which then order the various factories to supply the products to the mentioned depot.
The supply is met within a week. HUL has 45 C&F’s with 7000 stockists and 2000+ suppliers and
associates to target the market.
C&F
STAGE 2-
WHOLESALERS
The C&F then supplies the products according to the demand of various wholesalers. Each of the
depot cover a region assigned to them.
Each C&F acquires 5-7 trucks and hire 4-5 more trucks to supply products everyday.
They work on the concept of advance payment by DD by the wholesalers and deposit them in the
bank which is transferred to the head office.
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49. HUL DISTRIBUTION NETWORK IN RURAL MARKET
MANUFACTURING UNITS ALL ACROSS INDIA
C&F 1 C&F 2 C&F 3 C&F 4 C&F 5 C&F 6 C&F 7
STOCKISTS STOCKISTS STOCKISTS STOCKISTS STOCKISTS STOCKISTS STOCKISTS
WHOLESALERS
AGENTS
RETAILERS
CUSTOMERS
IN Rural Geographic Regions of India the product which should be made by the manufactures can
be delivered through by C & F unit and these unit provide stock in the hand of the merchant
wholesalers. Wholesaler delivers the product or stock to the different retailers (who sales stock in
49
50. breaking bulk) through by agents. The main difference in urban and rural areas distribution
networks are the agent who made relation between merchant wholesalers to retailers. Retailers can
sell stock in small quantity to the ultimate consumers.
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53. NATION WIDE MANUFACTURING:
80 factories, across India
The year was 1923. Lord Leverhulme, the legendary founder of Lever Brothers, was visiting India.
The nationalist sentiment in India was for locally manufactured products. Lord Leverhulme, who
believed that what is good for a country is equally good for the company, responded to that
aspiration because he too shared that dream.
His dream ultimately was realised in 1934. In September 1934, after more than a decade of
discussions in London and in India, a Lever factory was allowed to sprout on the land that had
been reclaimed by the Bombay Port Trust at Sewri. From here, a month later rolled out the first
cake of Sunlight soap to be manufactured in India. The same year, Lever Brothers took over the
Garden Reach Factory in Kolkata.
These two factories were the first in a manufacturing base, which today literally dots the length
and breadth of India. From Assam to Gujarat, from Uttaranchal to Kerala.
Hindustan Unilever's diverse product range is today manufactured in about 80 factories. In
addition, the company outsources from 150 other units. The operations involve 2,000 suppliers and
associates.
DEVELOPING BACKWARD AREAS
Several HUL factories are situated in backward areas. The company has consciously responded to
the national policy of development of backward areas by setting up manufacturing units in these
places, which provide several direct and indirect employment opportunities for these areas, and
leads to general economic development of these regions through industrialization. In fact, all major
investments of HUL, in recent years, have been either in A-Category backward areas or No-
Industry Districts. These include factories in Khamgaon and Yavatmal (Maharashtra), Chhindwara
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54. (Madhya Pradesh), Orai, Sumerpur and Khalilabad (Uttar Pradesh), Haldia (West Bengal),
Silvassa (Dadra & Nagar Haveli), Pondicherry, Goa, Doom Dooma (Assam), Haridwar
(Uttaranchal) and Barotiwala (Himachal Pradesh). Since 2001 itself, HUL has set up nine new
factories in backward areas.
Equally, HUL has an enviable track record in taking over sick enterprises, in response to requests
from Government, and converting them into viable operations. The company's units at Mangalore
and Rajpura all bear testimony to this achievement. In the process, HUL has saved precious jobs
and developed local economies.
HUL's manufacturing facilities, like the Khamgaon soap plant and the Sumerpur detergent bar
unit, are recognized as among the best in the Unilever world.
HUL has adopted Total Productive Maintenance (TPM) for achieving manufacturing excellence
since 1994. As on date, TPM is in different stages of implementation in 28 factories. Four HUL
factories have already received the TPM Consistency Award, and 14 factories have been awarded
with the TPM Excellence Award.
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55. MEETINGS NEEDS EVERY WHERE
How do you ensure that Mr. Ramesh in Kanyakumari gets his Lifebuoy soap and Mrs. Kulkarni in
Jammu gets to know how Bru coffee tastes even before she has bought it? Well, you need to have
a cutting edge distribution network in place.
Hindustan Lever's distribution network is recognized as one of its key strengths. Its focus is not
only to enable easy access to our brands, but also to touch consumers with a three-way
convergence - of product availability, brand communication, and higher levels of brand
experience.
HUL's products, manufactured across the country, are distributed through a network of about 7,000
redistribution stockists covering about one million retail outlets. The distribution network directly
covers the entire urban population.
The general trade comprises grocery stores, chemists, wholesale, kiosks and general stores.
Hindustan Lever services each with a tailor-made mix of services. The emphasis is equally on
using stores for direct contact with consumers, as much as is possible through in-store facilitators.
AT THE SUPERMARKETS
Self-service stores and supermarkets are fast emerging in metros and large towns. To service
modern retailing outlets in the metros, HUL has set up a full-scale sales organization, exclusively
for this channel. The business system delivers excellent customer service, while driving growth for
the company and the store. At the same time, innovative marketing initiatives are taken to provide
consumers with experience of our brands at the store itself, through product tests and in-store
sampling.
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56. IN THE VILLAGES
HUL has also revamped its sales organization in the rural markets to fully meet the emerging
needs and increased purchasing power of the rural population. The company has brought all
markets with populations of below 50,000 under one rural sales organization. The team comprises
an exclusive sales force and exclusive redistribution stockists, under the charge of dedicated
managers. The team focuses on building superior availability, while enabling brand building in the
deepest interiors. HUL's distribution network in rural India already directly covers about 50,000
villages, reaching about 250 million consumers, through about 6000 sub-stockists.
HARNESSING INFORMATION TECHNOLOGY
An IT-powered system has been implemented to supply stocks to redistribution stockists on a
continuous replenishment basis. The objective is to catalyze HUL's growth by ensuring that the
right product is available at the 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 online interaction on orders, dispatches, information sharing and monitoring. RS
Net covers about 80% of the company's turnover. Today, the sales system gets to know every day
what HUL stockists have sold to almost a million outlets across the country. RS Net is part of
Project Leap, HUL's end-to-end supply chain, which also includes a back-end system connecting
suppliers, all company sites and stretching right upon stockists.
PIONEERING NEW CHANNELS
Hindustan Unilever is simultaneously creating new channels, designed on the same principle of
holistic contact with consumers.
Project Shakti, HUL's partnership with Self Help Groups of rural women, is becoming an
extended arm of the company's operation in rural hinterlands. Started in 2001, Project Shakti has
already been extended to about 50,000 villages in 12 states - Andhra Pradesh, Karnataka, Gujarat,
Madhya Pradesh, Tamil Nadu, Chattisgarh, Uttar Pradesh, Orissa, Punjab, Rajasthan, Maharashtra
and West Bengal. The respective state governments and several NGOs are actively involved in the
56
57. initiative. The SHGs have chosen to partner with HUL as a business venture, armed with training
from HUL and support from government agencies concerned and NGOs.
Hindustan Unilever Network (HUN) is the company's arm in the Direct Selling channel, one of
the fastest growing in India today. It already has about 3.5 lakh consultants - all independent
entrepreneurs, trained and guided by HLN's expert managers. HLN has already spread to over
1500 towns and cities, covering 80% of the urban population, backed by 42 offices and 240 service
centres across the country. It presents a range of customized offerings in Home & Personal Care
and Foods.
Out-of-Home consumption of products and services is a growing opportunity in India, as
elsewhere in the world. Hindustan Unilever is already the largest player in the hot beverages out-
of-home segment, with over 15000 tea and coffee vending points. The company is expanding the
network aggressively, in the education, entertainment, leisure and travel segments. HUL's alliance
with Pepsi will significantly strengthen this channel.
Health & Beauty Services are Hindustan Unilever's simultaneous foray to meet the increasing
consumer need for such products and services. Lakme Salons provide specialized beauty services
and solutions, under the recognized authority of the Lakme brand. The Ayush Therapy Centers
provide easy access to authentic Ayurvedic treatments and products.
Hindustan Unilever, which once pioneered distribution in India, is today reinventing distribution -
creating new channels, and redefining the way current channels are serviced. In the process it is
converging product availability, with brand communication and brand experience.
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58. SHAKTI - CHANGING LIVES IN RURAL INDIA
Shakti is HUL's rural initiative, which targets small villages with population of less than 2000
people or less. It seeks to empower underprivileged rural women by providing income-generating
opportunities, health and hygiene education through the Shakti Vani programme, and creating
access to relevant information through the iShakti community portal.
In general, rural women in India are underprivileged and need a sustainable source of income.
NGOs, governmental bodies and other institutions have been working to improve the status of
rural women. Shakti is a pioneering effort in creating livelihoods for rural women, organized in
Self-Help Groups (SHGs), and improving living standards in rural India. Shakti provides critically
needed additional income to these women and their families, by equipping and training them to
become an extended arm of the company's operation.
Started in 2001, Shakti has already been extended to about 80,000 villages in 15 states - Andhra
Pradesh, Karnataka, Tamilnadu, Maharashtra, Gujarat, Madhya Pradesh, Chattisgarh, Uttar
Pradesh, Rajasthan, Punjab, Haryana, West Bengal, Orissa, Bihar & Jharkhand. The respective
state governments and several NGOs are actively involved in the initiative.
Shakti already has about 25,000 women entrepreneurs in its fold. A typical Shakti entrepreneur
earns a sustainable income of about Rs.700 -Rs.1,000 per month, which is double their average
household income. Shakti is thus creating opportunities for rural women to live in improved
conditions and with dignity, while improving the overall standard of living in their families. In
addition, it involves health and hygiene programmes, which help to improve the standard of living
of the rural community.
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59. Shakti's ambit already covers about 15 million rural population.
Plans are also being drawn up to bring in partners involved in agriculture, health, insurance and
education to catalyze overall rural development.
HUL's vision for Shakti is to scale it up across the country, covering 100,000 villages and touching
the lives of 100 million rural consumers by 2005.
Shakti Vani is a social communication programme. Women, trained in health and hygiene issues,
address village communities through meetings at schools, village baithaks, SHG meetings and
other social fora. In 204, Shakti Vani has covered 10,000 villages in Madhya Pradesh, Chattisgarh
and Karnataka. The vision is to cover 80,000 villages in 2005.
iShakti, the Internet-based rural information service, has been launched in Andhra Pradesh, in
association with the Andhra Pradesh Government's Rajiv Internet Village Programme. The service
is now available in Nalgonda, Vishakapatnam, West Godavari and East Godavari districts. iShakti
has been developed to provide information and services to meet rural needs in medical health and
hygiene, agriculture, animal husbandry, education, vocational training and employment and
women's empowerment. The vision is to have 3,500 kiosks across the state by 2005.
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62. LIFEBUOY SWASTHYA CHETNA
HEALTH & HYGIENE EDUCATION
Lifebuoy Swastya Chetna (LBSC) is a rural health and hygiene initiative which was started in
2002. LBSC was initiated in media dark villages (in UP, MP, Bihar, West Bengal, Maharashtra,
Orissa) with the objective of spreading awareness about the importance of washing hands with
soap.
The need for a program of this nature arose from the fact that diarrhoeal diseases are a major cause
of death in the world today. It is estimated that diarrhoea claims the life of a child every 10
seconds and one third of these deaths are in India. According to a study done by the London
School of Hygiene and Tropical Medicine, the simple practice of washing hands with soap and
water can reduce diarrhoea by as much as 47%. However, ignorance of such basic hygiene
practices leads to high mortality rates in rural India.
Being India’s leading personal wash health brand, Lifebuoy saw a role for itself in propagating the
message of hygiene and health in villages. We launched our Lifebuoy Swasthya Chetna initiative
keeping this rationale in mind.
LBSC is a multi-phased activity which works towards effecting behaviour change amongst the
rural population it touches. It demonstrates that “visible clean is not really clean” thereby proving
the importance of washing hands with soap. It targets children as they are the harbingers of change
in society and mothers since they are the custodians of health.
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63. As stated above, the campaign has been divided into various phases. In the initial phase, a Health
Development Facilitator (HDF) and an assistant initiates contact and interacts with students and
influencers of the community, i.e. village community representatives, medical practitioners, school
teachers etc. A number of tools such as a pictorial story in a flip chart format, a "Glo-germ
demonstration" and a quiz with attractive prizes to reinforce the message are used. The "Glo-Germ
demonstration" is a unique tool to make unseen germs visible and emphasize the need to use soap
to wash hands and kill germs. The first interaction with students is then replicated with the women
and finally the rest of the community. The various stages reinforce the message and learnings,
which is crucial in order to effect awareness and behaviour change in favour of hand wash
hygiene.
The programme has touched 27000 villages and 80 mn people over the last four years. In 2006
alone LBSC contacted 10,000 villages in UP, MP, Jharkhand and Bihar. This on-going project is
committed to spreading the message of health and hygiene and touching more lives in rural India
over 2007.
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64. FAIR & LOVELY FOUNDATION
Economic Empowerment of Women
The Fair & Lovely Foundation is HUL's initiative which aims at economic empowerment of
women across India. It aims to achieve this through providing information, resources, inputs and
support in the areas of education, career and enterprise. It specifically targets women from low-
income groups in rural as well as urban India. Fair & Lovely, as a brand, stands on the economic
empowerment platform and the Foundation is an extension of this promise. The Foundation has
renowned Indian women, from various walks of life, as its advisors. Among them are
educationists, NGO activists, physicians. The Foundation is implementing its activities in
association with state governments.
In India, low-income families, albeit unwillingly, tend to discriminate against girl children, in
providing opportunities for education and enterprise, because of resource constraints. The support
provided by Fair & Lovely Foundation will help girl children avail opportunities of higher
education and acquire skills in appropriate professions. The series of projects that have been drawn
up to achieve the vision include the following:
Careers:
Career guidance is provided by organising career fairs. About 500,000 students have benefited
from these career fairs in 150 towns and cities in till 2004, getting acquainted with over 200 career
options. The programme offers workshops for career guidance, resume-writing skills, personality
development. A career guidance programme has also been specially designed for television, and is
running on three TV channels. Career columns are being written and sponsored in different
magazines.
64
65. Education:
Scholarships for education such that it opens career avenues, specifically targeting low-income
groups are being provided. 2003 was the first year of scholarships - 147 students have received
scholarships in 2003. The 2004 scholarships for urban students have been announced; 72 women
have received the scholarships. The scholarships for rural students are yet to be announced.
Enterprise:
Vocational training
a. a three-month Home Health Care Nursing Assistant's Course
b. skill development in the areas of embroidery and garment designing
c. professional course for aspiring beauticians.
In all, 400 women have been trained till 2004.
The Foundation has also begun to train "Balwadi" teachers. About 1000 teachers have been trained
in Maharashtra and a pilot has begun in Bihar.
Launched in 2003, Fair & Lovely Foundation seeks to impact the lives of about 5000 women by
2005. This will be done through scholarships and enterprise initiatives. For career guidance, it
seeks to touch millions of aspiring women and students in an ongoing programme.
65
66. ORDER/ PRODUCT FLOW THROUGH SUPPLY CHAIN MANAGEMENT
IN HINDUSTAN UNILEVER LIMITED
ORDER/ PRODUCT FLOW THROUGH SUPPLY CHAIN FUNCTIONS
Orders Products
DATA
MANAGEMENT CHANNEL A
Orders
CHANNEL B CUSTOMER
Products Orders
Products PRODUCT
MANUFACTURING DISTRIBUTION CHANNEL C
Products
Parts
Production
plans
Demand
PART SUPPLY SUPPLY PLANNING Forecast
DEMAND
PLANNING
Component
Requirement
66
67. LIST OF COMPETITORS:
1. Procter & Gamble
2. ITC Ltd.
3. Nirma
4. Colgate Palmolive Company
5. Nestle
6. Britannia
7. Dabur
8. Wal-Mart
67
68. 9. Marico
10. Tata tea
11. GSK
12. GCPL
13. Gillette
RESEARCH METHODOLOGY
Research in common parlance prefers to a search for knowledge. Once can also define research as
a scientific and systematic search for pertinent information on a specific topic. In fact research is
an art of scientific investigation. Research is an academic activity and as such the term should be
used in a technical sense.
Research Problem:
In every organization “Distribution channel” makes its own place. All Business organizations are
using Distribution Channel to provide its goods to manufactures to the end users. Because of
which our study is going on to describe the “Distribution Channel of Hindustan Unilever Limited
in rural market”.
Research Objective:
68
69. The purpose of the research is to discover answers to question through the application of scientific
procedures. The main aim of the research is to find out the truth which is hidden and which has not
been discovered as yet. Though each research study has its own specific purpose we may think of
research objectives as falling into a number of following broad grouping:
• Study of Distribution channel of “Hindustan Unilever Limited” in rural market .
• Market survey of different retailers who provided the Hindustan Unilever Limited
products to the end consumers in Rural Market.
RESEARCH PLAN:
Research Design:
“Research design is the arrangement of conditions for collection and analysis of data in a manner
that aims to combine relevance to the research purpose with economy in procedure”.
In this research project we can take Descriptive Research for collection and analysis of Data.
Descriptive Research:
Descriptive research includes surveys and fact-finding enquiries of different kinds. The major
purpose of descriptive research is description of the state of affairs as it exists at present. The main
69
70. characteristics of this method are that the researcher has no control over the variables; he can only
report what has happened or what is happening.
SAMPLE DESIGN:
A sample is only a portion of the universe or population. A sample design is a definite plan for
obtaining a sample from a given population. It refers to the technique or procedure or the
researchers adopts in selective items of the sample so that the data collected may be the
representative of the population.
Method of Sampling:
Probability Sampling:-
It is also known as random sampling. Here, every item of the universe has an equal chance or
probability of being chosen for sample.
Probability sampling may be taken in form of:
• Simple Random Sampling
• Systematic Random Sampling
• Stratified Random Sampling
• Cluster and area Sampling
• Sequential Random Sampling
70
71. Non-Probability Sampling:-
It is also known as deliberate or purposive or judge mental sampling. In this type of sampling,
every item in the universe does not have an equal, chance of being included in a sample.
Non- Probability sampling may be taken in form of:
• Convenience Sampling.
• Quota Sampling.
• Judgement Sampling.
We choose Simple Random Sampling method here for analysis of data.
Simple Random Sampling: - As it is very difficult to meet each and every respondent. So, we
randomly select the sample and in this type of sampling every member has an equal chance of
selection so that data has been collected randomly.
Sample Size:
This refers to the number of items to be selected from the universe to constitute a sample. The size
of the sample should not be too larger or too smaller. It should be optimum. An optimum sample is
one which fulfills the requirements of efficiency, representatives, reliability and flexibility
100 retail units or outlets are the SAMPLE SIZE.
Sample Universe:
Lucknow City, Barabanki etc.
71
72. RESEARCH INSTRUMENT:
Questionnaire:
Questionnaire are formal set of question prepare to collect the required information. This is one of
the most effective and popular techniques used in surveys. However one has to be careful while
drawing up questionnaire before deciding on the questions it is important to understand the exact
nature of the information required and who should be interviewed.
The content, phrasing and the sequence of the questionnaire should also be clear and unambiguous.
The knowledge levels of the target of respondent should also be kept in mind while drawing up the
questions.
Data Collection Methods:
In dealing with any problem, once the sample has been selected data must be collected from the
sample population. There are several ways of collecting the appropriate data, which defer
considerably in the context of cost, time and other resources.
Questionnaires, Personnel Interview, Open ended, Close ended & multiple Questions in the
questionnaire have been asked from the sample to draw a useful conclusion.
They can be broadly divided into two into two categories:
• Primary Source
• Secondary Source
72
73. Primary Data:
Primary data is a data which is collected from a fresh for the first time. There are several methods
of collecting the primary data are as follows:
• Observation Method
• Interview Method
• Questionnaire Method
• Depth Interview Method
• Content Analysis Method
The data collected in this project is primary data and they could be made through by Questionnaire
and Observation method.
Secondary Data:
There are those data which have already been collected by someone else and have panel through
statistical power. When the researcher utilizes secondary data, he has to look into various sources
from where he can obtain data usually published data is available in:
• Technical and trade journals.
• Books, Magazines & newspapers.
• Public records & statistics.
• Historical Documents and other resources.
• Website journals, etc.
73
74. ANALYSIS OF DATA:
1. (A) Do you keep products of HUL in your outlet/shop?
a).Yes 88 b). No 12 .
Do you keep products of HUL in your outlet/shop?
100
88
90
80
70
60
50
40
30
20
12
10 74
0
Yes No
75. 1 B) Why don’t you keep the products of HUL in your shop or why did you stop keeping its
products?
a). erratic supply 4
b). lack of demand 2
c). low margin 2
d). no supplier 3
e). don’t know about the company 1
75
76. Why don’t you keep the products of HUL in your
shop?
4.5
4
4
erratic supply
3.5
3
3 lack of demand
2.5
low margin
2 2
2
no supplier
1.5
1
1 don’t know about the
company
0.5
0
1
2. From whom do you purchase your product?
1). Distributor 25
2). Dealer/ Agent 40
3). Agency 18
4). Wholesaler 17
76
77. From whom do you purchase your product?
17
25
3.
Distributor
Dealer/ Agent
18 Agency
Wholesaler
40
How do you rate the delivery process of the distributor/dealer?
a) Excellent 25
b) Above Average 33
c) Average 38
d) Below Average 4
e) Extremely Poor 0
77
78. How do you rate the delivery process of the
distributor/dealer?
4 0
25
Excellent
Above Average
38
Average
Below Average
Extremely Poor
33
4. Are you satisfied with the distributor/dealer behavior?
Yes 68
No 32
Are you satisfied with the distributor/dealer behavior?
80
68
70
60
50
Yes
40
32 No
30
20
10
78
0
1
79. 5. Are you satisfied with the delivery of the goods supplied by distributor/ dealer?
Yes 71
No 29
Are you satisfied with the delivery of the goods supplied by
distributor/ dealer?
29
Yes
No
71
79
80. 6. Are they providing you adequate supply of goods?
Yes 76
No 24
Are they providing you adequate supply of goods?
80 76
70
60
50
Yes
40
No
30 24
20
10
0
1
80
81. 7. Is the distributor taking the damages/ compensation regularly?
Yes 78
No 22
Is the distributor taking the damages/ compensation regularly?
90
78
80
70
60
50 Yes
40 No
30
22
20
10
0
1
81
82. 8. What is the mode of payment to the distributor/ Dealer by Retailer?
Cash 62
Credit 24
Cheque 14
What is the mode of payment to the distributor/ Dealer by
Retailer?
14
Cash
Credit
24
Cheque
62
82
83. 9. Are they providing you any discount on cash payment?
Yes 52
No 48
Are they providing you any discount on cash payment?
53
52
52
51
50
Yes
No
49
48
48
47
46
1
In the case of Hindustan Unilever Limited the company is providing Rs.800 per month for a
Windows display along with 1% cash discount and 2% on the sales amount on quarterly basis
given to his retailers.
83
84. 10. Any extra benefit for the increment of the sales given by them?
Windows Display 75
Long term sales plan 20
Canopy 5
Any extra benefit for the increment of the sales given by them?
5
20
Windows Display
Long term sales plan
Canopy
75
84
85. 11. Can agents regularly make aware you about the new products of HUL regular or not?
Yes 72
No 28
Can agents regularly make aware you about the new products
of HUL regular or not?
80
72
70
60
50
Yes
40
No
28
30
20
10
0
1
85
86. FINDINGS
1. In case of sales agent behaviors the HUL agents are more efficient and focused.
2. Due to 4 Distributors in Lucknow it is easier for the retailers to give orders because of small
payments.
3. There are many schemes given by the HUL in small quantity to his retailers i.e., Cash
discount on every sales order.
4. Experience salesman easily influences the super value store.
5. HUL are providing much benefit to the retailer to increase their sales i.e., windows display,
canopy etc.
86
87. RECOMMENDATION
These are some of the recommendation which can be given in case of Hindustan Unilever
Limited:-
1. Sales agent who is in rural market should be experience person because they are easily made
relationship with her retailers.
2. HUL can provide a various new schemes to his retailers for making potential retailers.
3. There should be some visit of the Area Manager from time to time arrange by the company.
4. The employee should be given uniforms in which the name of the company should be
printed, by doing this the sales people get motivated. These shops should be opened for 24
hours. They should offer 24 hours free home delivery system.
5. The delivery vehicle should be attractive the name of the company should be printed in that
so that it becomes the sources of advertisement.
6. The companies should emphasis on its advertisement; there should be BRAND FIT in that.
For example when lux launch its advertisement with sharukh khan with girls. It was heavily
criticized because it was not fit with the brand. It adversely affects the opinion of the
customer and it results in decrease in sales.
7. Company should emphasis on their business areas. They should penetrate their business in
the rural areas. 69% of the Indian population lives in rural areas. There is huge market there
and very less market has been penetrated.
87
88. CONCLUSION
With the study of the topic we can know about the distributor relationship with the retailers of the
largest firm in retail Sector are:
HINDUSTAN UNILEVER LIMITED.
With the study it can be easily known how the retailers are been selected HINDUSTAN
UNILEVER LIMITED (Super value store) and what the terms and conditions regarding the
selection of the retailers and what are the benefits being provided to the retailers and what are the
various benefits being provided to the retailers in order to increase their sales.
The company is making there strategies regarding the customer and the various product assortment
being provided to the retailers and whether the distributor is helping the retailers in managing the
demand of the retailers and also the sales agent behavior and delivery man behavior affects the sale
of the retailers as well as the distributor.
So, my study is visualize the distribution channel of the HINDUSTAN UNILEVER LIMITED in
rural areas and they say that retailers liked
LIMITATIONS
88
89. Everything in this world has its own advantages and disadvantages which shows ‘nothing is
perfect’.
Following are the problems faced but it’s a part of game:
1. TIME CONSUMING: It is very much obvious that it is a time consuming process. So much
time has been spent for this purpose.
2. LOW PARTICIPATION: Obviously many respondents have not participated in this and have
also created some problems which simply shows that they were not interested.
3. BIASNESS: Sometimes interested customers were also biased so the collected figures involve
both positive and negative figures.
4. It does not cover all the aspects of the company.
5. SUBJECTIVE: This project only tells you what it is all about.
BIBLOGRAPHY
89
90. Books:-
C R Kothari (Research Methodology)
Websites:-
www.hul.com
www.google.com
Magazines & Newspapers:-
Business World
Economic Times
The Times of India
90
