FMCG IndustryHindustan Unilever Limited

Group 4

Group Members
Smruti Kumar Aditi Upadhaya Broyston Dias Ozer Dsilva Sachin Silveira Vikrant Prabhu

Introduction
What is FMCG?

Products which have a quick turnover, and relatively low cost are known as Fast Moving Consumer Goods (FMCG). FMCG products are those that get replaced within a year.

Overview of FMCG Industry

According to the AC Nielsen India study, the industry grew 5.3% in value between 2004 and 2005. FMCG include a wide range of frequently purchased consumer products such as toiletries, soap, cosmetics, tooth cleaning products, shaving products and detergents. FMCG may also include pharmaceuticals, consumer electronics, packaged food products, soft drinks, tissue paper, and chocolate bars.

Indian FMCG Sector

The Indian FMCG sector is the fourth largest in the economy and has a market size of US$13.1 billion. FMCG in India has a strong and competitive MNC presence across the entire value chain. Well-established distribution networks, as well as intense competition between the organised and unorganised segments are the characteristics of this sector

Top 10 FMCG Companies in India

Hindustan Unilever Ltd. ITC (Indian Tobacco Company). Nestl India. GCMMF (AMUL). Dabur India. Cadbury India. Britannia Industries. Procter & Gamble Hygiene and Health Care. Marico Industries.

Interesting Facts About HUL Logo

Introduction

Unilever was founded on 1 January 1930 by Lever Brothers . In 1931, Unilever set up its first Indian subsidiary, Hindustan Vanaspati Manufacturing Company. Unilever acquired Lipton in 1972 and in 1977 Lipton Tea (India) Limited was incorporated.

Pond's (India) had been in Indian market since 1947.

Pond's (India) Limited had been present in India since 1947.

Products of HUL

SWOT ANALYSIS OF HUL

Strengths

Wide range of Innovative products. Strong Brand (Portfolio, price, quantity, variety, etc.) Distribution Network. - 3400 distributors - 16 million outlets over the world - 700 million customer base Strong R & D. Highly skilled Human Resource Market Position

Weaknesses

Not able to compete with local competitors in the rural market. Changing consumption patterns. Low exports level (At present). High advertising costs.

Opportunities

Huge domestic market (Over a billion population).

Changing Lifestyle and Increasing per capital income. Untapped Rural Market

Opportunities (Growth Prospects)

Threats

New Entrant Competitors Increasing costs (E.g. Raw Materials)

Market Share

Market Share
HUL ITC Others Dabour Britania Nestle
8% 6%

5%

35%

17%

29%
Source: Nielsen

Market Position

Industry Category and Products

Household Care Personal Wash: HUL is the leader with market share of 53%. Detergents: HUL is the leader with 38% of market share. Personal Care Skin Care: HUL is the leader with a market share of 54%. Shampoos: Again the market is dominated by HUL with around 47% market share. Oral Care: HUL occupies second position with market share of 30%.

Cont...
Food & Beverages

Food Segment: The foods category in FMCG is gaining popularity with a swing of launches by HUL, ITC, Godrej, and others.
Tea: Leading branded tea players are HUL and Tata Tea. Coffee: The major players in this segment are Nestl, HUL and Tata Tea.

Financials

HUL: 5 reasons why shares have hit life-time high

Here are the reasons for the strong buying interest seen in the stock;

Strong volume growth Net jumps twofold Sales in-line with estimates Margins expand Both home and personal care and foods segments registered double digit growth

Porters Five Forces Analysis

Threat to Entry- LOW

Low capital requirement to entry Cost advantage independent of size High scope of innovation

Power of Buyers- HIGH

Differentiated R.M. by supplier Low switching cost

Power of Supplier- LOW

Many suppliers Most R.M(S) homogeneous & not complex, hence easily available

Threat of Substitute- High

Product-for-product substitute Slightly differentiated products

Competitive Rivalry- High

Highly saturated industry (scarce customers) Constant innovation and marketing tactics

Marketing Mix

PRODUCT
HOME CARE

PERSONAL CARE

FOOD PRODUCTS

WATER PURIFIER

PLACE

Use 0,1 & 2 level of distribution channel Convenient stores (food, home care &personal care products) Departmental stores ( personal care, home care, food products) Supermarkets ( food products, home care products) General stores (food, home care products) Malls (food & personal care products) Exclusive outlets (Lakme salons, Ayush Therapy Centres) OOH (Out-Of-Home) consumption- 15000 tea & coffee vending points Direct selling- water purifier, 3.5 consultants for customized offerings in home, personal care & foods.

PRICE

Disparate type of pricing adopted for various product categories

Few product categories with two end pricing targeting different segmentsDetergent- wheel (low price), Surf Excel (high price) Soap- Dove, Lux (high price), Breeze, Rexona (low price)etc.
Yet pricing strategy common to allMarket-oriented pricing (based on competitors price- lower or price leadership) example- Annapurna atta- 5Kg. For Rs. 190 & Ashirwad atta 5Kg. For Rs. 195

PROMOTION

PLATFORMS USED: Print media Electronic media Live demonstrations and contests Common promotion strategy: Utility/ functionality based (in most brands) ex. Vim 100 nimbooyon ki shakti

CSR Activities

Health & Hygiene Education

Awareness of washing hands with soaps

Lifebuoy Swastya Chetna (LBSC) is a rural health and hygiene initiative which was started in 2002. 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.

SHAKTI -

Changing Lives in Rural India

It seeks to empower underprivileged rural women by providing

income-generating opportunities.
It is a pioneering effort in creating livelihoods for

rural women.

Shakti provides critically needed additional income to these

women and their families.

Economic Empowerment of Women

The Fair & Lovely Foundation is HUL's initiative which aims at economic empowerment of women across India. 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.

Special Education & Rehabilitation

Ankur: The centre takes care of children with challenges, aged between 5 and 15 years. Ankur provides educational, vocational and recreational activities to over 35 children. Anbagam: Yet another day care center, Anbagam ("shelter of love"), has been started in 2003 also in the South India Plantations. It takes care of 11 children.

Latest Product innovations

New Vaseline Skin lotion: delivering moisture where its needed New Kwality Walls: with ice structuring protein which helps to make ice cream lower in fat & sugar. New Surf Excel Quick Wash: with anti-foam ingredients which reduces the need for rinsing & saves two bucketfuls of water per wash. HUL has developed & rolled out a hair shampoo called Tresemme which does not need water.

Sustainable Innovation

An upside-down roll-on deodorant that uses 18% less plastic in each pack. Pure It, a battery operated home water purification device which gives pure drinking water at low cost. Comfort Easy Rinse fabric conditioner which minimises the amount of water needed to rinse clothes.

Contd..

Another product developed by HUL is Magic liquid which will reduce water usage by two third. It is launched in water-scarce state of Andhra Pradesh

Career Options

The Fast Moving Consumer Goods (FMCG) sector has once again been voted by B-school students of the Class of 2012 as the most coveted sector for employment, with HUL topping the list of employers of choice According to this years survey conducted by Nielsen: -- Students choices FMCG sector (36%) Management consulting (29%) IT consultancy / services (20%) Investment banks (20%).

Cont...

Growth Potential: According to the survey, students felt that FMCG (25%), E-Commerce (22%), Management Consulting (19%), Financial Institutions (19%) and the Indian Banks (17%) were amongst the sectors with high growth potential.

Finance Department

The operating structure is divided into three work streams.

Finance Business Partners embed best practice and enhance decision support skills. Accounting and Information applies information management processes to create value for the business.
Expertise Services work across everything from insurance and risk, to investor relations and pensions.

Marketing Department

Brand development -- This is about creating exciting and compelling visions for their brands and developing plans across the full marketing mix.

Brand building -- Here they translate the visions into a local market context, plan practical activity and make sure those plans are executed flawlessly.

Human Resource Department

Diverse roles -- HR's job is to make sure we have highly-skilled, exceptional people in all areas of the organisation. -- Within that, there are numerous possibilities split into three broad areas. HR Services -- Deliver and continuously improve services such as payroll, recruitment, pensions and benefits. -- They also track, monitor and aggressively manage service performance to ensure that its delivered to the required quality and at the optimum cost.

Conclusion

With its long and luminous history HUL is India's true pride.

It is company which the customers in rural as well as urban India relate to. The future for HUL is demanding newer and high level innovations so as to cope up with increasing competition.
However HUL is well equipped with all what is needed of this Indian Giant.

Reference

http://www.about-fmcg.com/What-is-FMCG/FMCG-industry-facts http://www.scribd.com/doc/50140512/9/CH-3-4-MAJOR-PLAYERSIN-THE-FMCG-SECTOR-IN-INDIA http://in.reuters.com/finance/stocks/overview?symbol=HLL.NS http://www.hul.co.in/mediacentre/pressreleases/2012/HUL-JuneQuarter-2012-Financial-Results.aspx http://www.hul.co.in/mediacentre/newsandfeatures/ http://www.nielsen.com/in/en/news-insights/press-room/2012/fmcgthe-most-preferred-sector-for-b-school-students.html http://www.hul.co.in/careers-redesign/carreerschoices/

Thank You