Introduction«..

Y Hindustan Unilever Limited (µHUL¶), formerly Hindustan

Lever Limited (it was renamed in late June 2007 as
HUL).
Y India's largest Fast Moving Consumer Goods company
Y HUL is also one of the country's largest exporters
Y The mission that inspires HUL's over 15,000 employee
s, including over 1,300 managers, is to "add vitality
to life.³
Y 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.
4roducts«..
 mnalysis of Distribution Network of
HUL
Y We have analyzed the distribution network of HUL from the
following aspects:

1. Evolution of HUL¶s distribution network

2. Transportation & Logistics
3. Channel Design
4. Initiatives taken for channel member management
5. Field force management
6. mnalytical Framework
7. Financial mnalysis
 Evolution of HUL¶s distribution
Network
Y The first phase of the HUL distribution network
had wholesalers placing bulk orders directly with
the company
Y The focus of the second phase, which spanned
the decades of the 40s, was to provide desired
products and quality service to the company's
customers
Y The highlight of the third phase was the
concept of "Redistribution Stockist" (RS) who
replaced the RWs
Distribution at Villages«

Ö Ö
Ö 
 
Distribution at Urban Centers«
Y Distribution of goods from the manufacturing
site to C & F agents take place through
either the trucks or rail roads depending on
the time factor for delivery and cost of
transportation.
Y Generally the manufacturing site is located
such that it covers a bigger geographical
segment of India.
Y From the C & F agents, the goods are
transported to RS¶s by means of trucks and
the products finally make the µlast mile¶ based
on the local popular and cheap mode of
transport.
New Distribution Channels«
4roject Streamline«.
 Hindustan lever Network

Y Mother Depot and Just in Time

System
Y Leveraging Information technology
Y RS Net Initiative
Y mdexa iCollaboration suite
p        !
p   "  #  $% &
 Channel Design
Y Hindustan Lever Limited (HUL) has two
types of channel selling å

i. Regular (traditional) retail channel,

ii.Direct Selling Channel in the name of
Hindustan Lever Network (HLN).
 Channel structure
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    å
o Wholesaler (gets 1.5 % max. discount from RS)
o Retailers (gets 1.0% max. discount from RS)
v


Y Gets cash discounts and other schemes promoted by HUL (gets
points under Vijeta Scheme).
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 23

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Y o Soap, detergents å 8% on MR4

Y o Cosmetics å 10% on MR4
Y o Food items å 8% on MR4
# #(
Y Company programs (Scheme Discounts + Cash Discounts)
Y T4R schemes based on Sales (1 % to 4 %)
Y Vijeta scheme is not for retailers.
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 Initiatives Taken to Improve The
Distribution Network

Y Setting up of a fullåscale sales organization comprising key

account management and activation to impact, fully engage
and service modern retailers as they emerge.
Y Servicing Channel partners and customers with continuous
daily replenishment.
Y Leveraging scale and building expertise to service Modern
Trade and Rural Markets.
Y Delaying of sales force to improve response times and
service levels
Y Launching the Unicare scheme with upmarket pharmacies and
retailers to sale its premium brands.
Y Launching of several promotional schemes for existing
wholesalers and distributors.
 Field Force Management

Y In HUL, the field force is evaluated using

´
´
 
     
 '   å

Y 1. Secondary Sale (Max points = 2.5)

Y 2. Eco (Max points = 0.5)
Y 3. Focus (Max points = 0.5)
Y 4. FCS (Max 4oints = 0.5)
 Non Monetary Methods

Y Based on the QOC various awards are distributed to the field

persons at the end of every month. These awards are also
known as µMOC Star¶ awards.

Y If QOC score > 4.5 - The person is eligible for 7 star award

Y If QOC score > 4 - The person is eligible for 5 star award

Y If QOC score > 3.5 -The person is eligible for 3 star award
 mnalytical Framework
Y We tried to analyze HUL¶s distribution network in the light of
20 most significant variables that affect the distribution part 0f
channel management for any organization in the business of
marketing & selling of goods.
1. No of Consumers
2. Geographic Dispersion Of Consumers
3. Frequency of purchase
4. Tendency to postpone purchase
5. Level of Familiarity/Knowledge (of consumer)
6. Degree of brand loyalty
7. 4urchased on Impulse
8. level of Involvement(LOI)
9. 4urchased as a Basket of Goods
10. Speed & complexity of Decision making process
mnalytical Framework cont«.

11. present of Expert influencer in the decision making process

12. Element of crisis purchase exists
13. Element of risk aversion exists
14. 4erish ability of the product
15. Time band associated with the purchase of the product
16. Fungibility
17. Degree of customization possible
18. Negative/4ositive reinforcing product
19. Value/Volume ration(value density) of the product
 Financial mnalysis
˜   !  

ms stated earlier also, marketing expenses here

include the following ±
- Commissions
- Rebates 29
- Discounts
- Sales promotional
- Expenses on direct selling agents
- Entertainment expenses etc.
"  !  
Y Distribution expenses include the outward freight
cost to the company.
Thank--You
Thank