Distribution Network of Hindustan Unilever

Presented By: Amit Joshi

 In 1931, Unilever set up its first Indian subsidiary, Hindustan

Vanaspati Manufacturing Company . Thereafter the Lever Brothers India Limited and United Traders Limited were established in 1933 and 1935 respectively. In November 1956, these three companies merged and form HUL.
Harish Manwani (Chairman), Nitin Paranjpe (CEO and Managing Director) Revenue 19,87.14 crore (US$4.46 billion) (2010-2011).

Hindustan Unilever's distribution covers over 1 million retail outlets across India directly and its products are available in over 6.3 million outlets in the country, nearly 80% of all retail outlets in India. The company claims that two out of three Indians use its many home and personal care products, food and beverages.

Personal wash

Lux, lifebuoy, dove Pears, rexona, breeze,

Laundry

Surf excel Wheel sunlight

Skin care

Fair & lovely Ponds Vaseline

Hair care
Hindustan unilever ltd Oral care

Sun silk Clinic

Pepsodent close-up

Deodorants

Axe rexona

Color cosmetics

lakme

ayurvedic

ayush

CONTRIBUTION TO DIFFERENT SECTORS

74.3%

Distribution Network of Hindustan UniLever (HUL)

A marketing channel performs the work of moving goods from

producers to consumers. Members of the marketing channel perform a number of key functions like forward flow of activity from the company to the customers(goods) & backward flow from customers to company (order, Payment).
FMCG major HUL is the subsidiary of UNILEVER with a

market capitalization of $ 14 billion. HUL owns 35 of Indias 150 most trusted & powerful brands.

To maintain their market leadership, HUL pursues innovative distribution mechanisms to reach the millions of potential consumers in both urban areas and small remote villages where there is no retail distribution network, no advertising coverage, and poor roads and transport.

 Project Shakti, launched in 2000. Its enabled Hindustan Lever to access

80,000 of India's 638,000 villages Project Shakti targeted the very small villages (<2,000) and tapped into preexisting womens self help groups (SHG). Underprivileged rural women were invited to become direct-to-consumer sales distributors for HUL products. Termed Shakti Ammas ,these women represent HUL and sell its home-care, health, and hygiene products in their villages. The company provides training in selling, commercial knowledge and bookkeeping to help them become micro-entrepreneurs. The idea is to be able to reach those villages which do not have good road connectivity and where the penetration of media is also poor. most Shakti entrepreneurs net a monthly profit of 700 - 1000 rupees. By the end of 2009 there were more than 45 000 Shakti entrepreneurs covering 3 million homes in 100 000 villages in 15 states in India

Sales & Distribution of HUL in Kolkata

Hindustan Unilever in Kolkata covers the consumers mainly with the combination of C&F and stockists who indirectly deal with the Retail outlets. The company which is headquartered in Mumbai has appointed M/s Mitra Logistic Pvt. Ltd as the C & F agent for Eastern region (West Bengal, Assam, Orissa & Bihar). C & F agents can be classified into 2 types:
With investment and Without investment.

The without investment C&F agents are mere Forwarding agents and act as the transporter to the company. M/s Mitra Logistic Pvt. Ltd is a forwarding agent on behalf of HUL. The C&F agent then supplies the goods to the authorized stockists. These Stockists are also classified into 2 categories called U1 and U2.

U1 & U2
The stockists are classified as U1 and U2 stockist on the basis of the products that they stock. E.g. U1 stockist generally stocks products like surf and ponds whereas the U2 stockist deals with high profile products of HUL like Lakme and Dove. The stockiest in HUL system is commonly referred to as Re Stockist (RS). In Kolkata there are approximately 7 U1 Stockists and 5 U2 Stockists. These are appointed for a particular region of the city. Each Stockist is then responsible for distributing the goods to the retail counters in his region. On an average Each Stockiest caters to 700-900 retail outlets of the city. The retailers then provide the goods to consumers.

U1 & U2
Then depending upon the type of products, sales, turnover and the number of retail counters a stockist is dealing with, the company has classified the stores into: Super Value Stores Smart / FLO Unicare Vijeta The stockist is also responsible for dealing with Modern retail outlets like shopper stop and pantaloon. The stockist also supplies the goods to CSD Canteens.

Sales force behind the Distribution channel

The distribution channel cannot be successful without a good sales force. In the case of HUL Kolkata the sales were co-ordinated by Area sales manager (ASM), Activation Manager (AM), Territory Sales In charge (TSI). These people were working on behalf of HUL and were a Link between the stockist and the company. The goods moved to the stockists godown by the companys Truck. The stockist then appointed a (Re Stockist Salesman) RSSM who was responsible for collecting the orders & payments from the retail outlets. The delivery is made by either cycle or through a van depending upon the size of the order. The lead time for delivery from the company was 1 day. The orders were placed online using the CRM software of unilever called UNIFY.

Ecommerce Marketing Practices

The company heavily relies on Electronic means of

communications for running the business. The entire Sales and distribution channel is integrated through eCRM software called UNIFY which are installed in every PC system of the C&F, Stockist. The company has up to date record of the inventory position of all the stockists. A stockist is required to maintain a minimum level of inventory. If the stock position goes below a critical level order is automatically triggered and the company sends the goods to the stockist. All operations thus take place online.

Thank You