A

Project Report
On “Study of supply Channel Management of Hindustan Unilever Limited.”

Submitted By

Partho mukherjee PGDM (operations) Sem 3rd
under the guidance of mr. Vivek swami sinhgad institute of business administration&research

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S. NO. 40/4A+4B/1 NEARPMCOCTROI POST, KONDHWA –SASWAD ROAD, KONDHWA (BK) PUNE-411048 CERTIFICATE

This is to certify that Mr. /Ms PARTHO MUKHERJEE student of SINHGAD INSTITUTE OF BUSINESS ADMINISTRATION & RESEARCH; Pune has completed report of “STUDY OF SUPPLY CHAIN MANAGEMENT OF HINDUSTAN UNILEVER LIMITED” academic year 2009-11 He has worked under our guidance and direction. The said report is based on bonafide information.

PROJECT GUIDE NAME Prof. VIVEK SWAMI D. pol

DIRECTOR prof . Avadhoot

Date:-

Place:-

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hereby declare that the project work STUDY OF SUPPLY CHAIN MANAGEMENT OF HUL Which has been submitted to SINHGAD INSTITUTE OF BUSINESS ADMINISTRATION & RESEARCH. Date: Signature of student Place: Partho Mukherjee 3 .Declaration I PARTHO MUKHERJEE of MMM-1V (2009-11). is an original work of the undersigned and has not been reproduced from any other sources and has not been submitted to any University for any other award of degree or Scholarship.

for his/her support and invaluable assistance rendered towards presentation of this work. and wholehearted involvement during every stage of this project. My special thanks to Prof. this project would never have been possible and have greatly influenced the timely and successful completion of this project. Vivek Swami. A. whose embellished ideas helped us to blossom our endeavors without whose considerate approach and insight. 4 . for his valuable guidance. being available beyond the stipulated period of time for all kind of guidance and supervision and ever-willing attitude to help.. POL Director. inspiration. Project Supervisor of MMM-IV Department.. His experience.Acknowledgement It gives me the great pleasure to express our deep sense of gratitude towards Prof. perception and through professional knowledge. of Sinhgad Institute of Business Administration & Research.

4 5. 04 06 07 08 09 12 23 24 REFERENCES 5 . 3.Table of Contents No 1 2. Topic ACKNOWLEDGEMENT OBJECTIVE OF THE STUDY SUMMARY RESEARCH METHODOLOGY INTRODUCTION COMPANY INTRODUCTION OF STUDY CONCLUSION Page No. 6. 7. 8.

What is the benefit to the customer from company`s channel management? 6 .OBJECTIVE OF STUDY 1. Which channel level is adopting by company? 5. To understand the way how they make smooth their processes. 4. 3. To understand the types of channel management. 2. To do the deep study of channel management adopted by Hindustan Unilever Limited.

Direct sell. 7 . this is one of the P from 4 P`s. Two level.SUMMARY I am doing my management thesis on Distribution Channel management of Hindustan Unilever Limited. Price. There are four types of P`s Product. There are alternate channels of distribution channel may be available. Distribution channels can thus have a number of levels. each passing the product down the chain to the next organization. Zero level. In it Hindustan Unilever Limited is one of the leading Organized Retailer. II. before it finally reaches the consumer or enduser. One level. Place and Promotion. V. Brokers. III. and HUL etc. In this four P`s Place means Distribution . Agent Distributors Retailers. Distribution Channel management means. I. Now a day’s FMCG sector is booming sector. I. IV. II. ITC. There are four types of distribution channels. In India there are very few organized retailer like P&G. For smooth running Channel management is very important to every firm. frequently there may be a chain of intermediaries. III.

IV. Three level. 8 .

Slazenger and Mr. . D. The research design will be descriptive in nature. Research Design Research design is an arrangement of conditions for collection of and analysis of data in a manner that aims to combine relevance to research purpose with economy of procedure. correct or verify knowledge.Stephenson in the encyclopedia of Social Sciences define Research as "the manipulation of things. Data Collection Data will be collected by two ways: Secondary Data This type of data has already been collected by someone else and has already passed through statistical process. whether that knowledge aids in construction of theory or in the practice of an art". collection. “Marketing Research is the systematic design. concepts or symbols for the purpose of generalizing to extend. analysis and reporting of data and finding relevant solution to a specific marketing situation or problem".RESEARCH METHODOLOGY Research Methodology is a way to systematically solve the research problem. The Research Methodology includes the various methods and techniques for conducting a Research. The sources of secondary data are: • Books • Websites • Magazines 9 .

detergents. HUL is the market leader in Indian products such as tea.INTRODUCTION OF COMPANY Hindustan Unilever Limited (abbreviated to HUL). and Surf. Rexona. Vim dishwash. BRANDS Some of its brands include Kwality Wall's ice cream. Hamam. Bru Coffee. 10 . Annapurna salt and atta. the non-executive chairman of the board. as its products have become daily household name in India. Lifebuoy. Pepsodent and Close Up toothpaste and brushes. Lux. Vaseline lotions. India and its 41. Kissan squashes and jams. is India's largest consumer products company and was formed in 1933 as Lever Brothers India Limited.000 employees are headed by Harish Manwani. Breeze. Fair & Lovely creams. soaps. Rin and Wheel laundry detergents. Lipton tea. The company was renamed in late June 2007 "Hindustan Unilever Limited". It is currently headquartered in Mumbai. Clinic All Clear. The Anglo-Dutch company Unilever owns a majority stake in Hindustan Unilever Limited. Brooke Bond tea. Pureit Water Purifier. Pond's talcs and creams. Lakmé beauty products. Liril. formerly Hindustan Lever Limited . Moti soaps. Sunsilk and Dove shampoos. Clinic Plus.

We meet everyday needs for nutrition. to working together effectively. hygiene and personal care with brands that help people feel good. Our long-term success requires a total commitment to exceptional standards of performance and productivity. To succeed also requires. hygiene. and the environment on which we have an impact. This is our road to sustainable. creating long-term value for our shareholders. 11 . we believe. our people. the highest standards of corporate behaviour towards everyone we work with. and our business partners. Corporate purpose Unilever's mission is to add Vitality to life. 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.Mission Unilever's mission is to add Vitality to life. profitable growth.a truly multi-local multinational. look good and get more out of life. the communities we touch. look good and get more out of life. We will bring our wealth of knowledge and international expertise to the service of local consumers . We meet everyday needs for nutrition. and to a willingness to embrace new ideas and learn continuously. and personal care with brands that help people feel good.

Market Share of Hindustan Unileaver Limited 12 .

13 . Alternate Channels A number of alternate 'channels' of distribution may be available: Selling direct. since both direct and indirect channels may be used. who sells to end customers Advertisement typically used for consumption goods Distribution channels may not be restricted to physical products alone. before it finally reaches the consumer or end-user. This process is known as the 'distribution chain' or the 'channel. who typically sells direct on behalf of the producer Distributor (also called wholesaler). airlines. which the producer must take into account. for example. centralized reservation systems. who sells to retailers Retailer (also called dealer or reseller). such as with an outbound sales force or via mail order. may sell their services (typically rooms) directly or through travel agents. each passing the product down the chain to the next organization. along with those of the all-important end-user. Hotels. tour operators. They may be just as important for moving a service from producer to consumer in certain sectors. tourist boards.INTRODUCTION OF STUDY Meaning of Distribution Channel Frequently there may be a chain of intermediaries. Internet and telephone sales Agent. etc.' Each of the elements in these chains will have their own specific needs.

In small markets (such as small countries) it is practical to reach the whole market using just one. But the most important is the distributor or wholesaler. even for the simplest of consumer goods. in consumer goods a retailer. a wholesaler for example. In IT and Telecom industry levels are named "tiers". as the 'zerolevel' channel. is now mainly used to extend distribution to the large number of small. 14 . The next level. which direct contact with no intermediaries involved. In Bangladesh Telecom Operators are using different Chains of Distribution.Channel Level Distribution channels can thus have a number of levels.and zero-level channels. for industrial goods a distributor. Kotler defined the simplest level. A one tier / two tier channel means that vendors work directly with dealers and with distributors who sell to dealers. especially 'second level'. neighborhood retailers or dealers. In Japan the chain of distribution is often complex and further levels are used. A one tier channel means that vendors IT product manufacturers (or software publishers) work directly with the dealers. features just one intermediary. In large markets (such as larger countries) a second level. the 'one-level' channel.

To all intents and purposes. In some parts of certain organizations this may in fact be formalized. offer a very useful parallel. is the use of `marketing' by service and administrative departments. or each departments. this process can and should be viewed as a normal buyer-seller relationship. In all of this. but just as practical. The fact that this is a captive market. 15 . in dealing with their clients. the lessons of the non-profit organizations.The internal market Many of the marketing principles and techniques which are applied to the external customers of an organization can be just as effectively applied to each subsidiary's. with the possible exception of the pricing mechanism itself. should not discourage the participants from employing marketing techniques. to optimize their contribution to their `customers' (the rest of the organization in general. as goods are transferred between separate parts of the organization at a `transfer price'. 'internal' customers. Less obvious. and those parts of it which deal directly with them in particular). resulting in a `monopoly price'.

Criteria for Selecting Channel Partners Sales Factors Product Factors Experience Factors Administrative Factors Risk Factors Motivating Channel Members Distributor Advisory Councils Evaluating Channel Members Modifying Channel Arrangements PLC Changes Growth of Multi-Channel Marketing Systems 16 .

Customers are constantly on the look out for convenience and service.for selecting channel members. Distribution channel is a key area that can be outsourced. when purchasing goods. A change in HUL product policy may need new type of channel members.How HUL Recruit Their Channel Members? To successful in the market HUL focus on core competencies and outsource other activities. Therefore recruitment of channel member in HUL is continuous process. who suit the company`s requirement. These criteria can be divided into sales factors. Managing channels is one of the most important dimensions of businesses across the world for improving their value in the market. the Hindustan Unileaver Limited. Alteration in customers test and preference will also influence the HUL to change existing channel members if they are unable to cater to the changed conditions. careful recruiting and screening producer is essential. has to make the final selection based on some criteria. Recruiting channel member should be a continuous process for two reason one is that channel member may leave the organization .the other is that the organization might feel the need to change existing channel members. 17 . experience factors. Effective channel management helps companies decrease costs and reach potential customers profitably. product factors. Recruiting as a Continuous Process. Effective channel management involves proper recruitment of channel members. but channel members have to be selected carefully . After effective screening. In the recruitment process. screening involves elimination of applicants who do not match the criteria set for the position. Recruiting channel members should be a continuous process.

Channel members can be evaluated by using parameters like sales quota attainment. All activities and organizations helping with the exchange are part of the marketer’s channels of distribution. average inventory levels.administrative factors and riskfactors. The distribution requirements of a company will keep changing according to changes in the product life cycle. However. channel members’ cooperation in promotional and training programmers.. we describe a supply chain as consisting of all parties and their supplied activities that help a marketer create and deliver products to the final customer. the distribution decision is primarily concerned with the supply chain’s front-end or channels of distribution that are designed to move the product (goods or services) from the hands of the company to the hands of the customer. Modifying channels accordingly is essential for the success of the organization. etc. they have to be constantly evaluated and based on their performance. Conflict management among channel members is another important activity for the management of the Hindustan Unileaver Limited. For marketers. 18 . After selecting channel members. But the idea is the same as with tangible goods. Channels of Distribution Of Hindustan Unilever Ltd`s In the Business Buying Behavior Tutorial. care should be taken in dealing with channel members for proper channel management. proper management of inventory. the Hindustan Unileaver Limited will either retain existing channel members or try to forge relationships with new channel members. Obviously when we talk about intangible services the use of the word “hands” is a figurative way to describe the exchange that takes place.

Resellers These organizations. distributors or dealers.Activities involved in the channel of Hindustan Unileaver Limited are wide and varied though the basic activities revolve around these general tasks:  Ordering  Handling and shipping  Storage  Display  Promotion  Selling  Information feedback Type of Channel Members Channel activities may be carried out by the marketer or the marketer may seek specialist organizations to assist with certain functions. 19 . generally purchase or take ownership of products from the marketing company with the intention of selling to others. also known within some industries as intermediaries. We can classify specialist organizations into two broad categories: Resellers and Specialty Service Firms. If a marketer utilizes multiple resellers within its distribution channel strategy the collection of resellers is termed a Reseller Network.

such as manufacturers or other wholesalers.e. storage. Distribution Service Firms – Offer services aiding in the movement of products such as assistance with transportation. Industrial Distributors – Firms that work mainly in the business-tobusiness market selling products obtained from industrial suppliers. Others – This category includes firms that provide additional services to aid in the distribution process such as insurance companies and firms offering transportation routing assistance. 20 . Wholesalers – Organizations that purchase products from suppliers. do not take ownership of the product): Agents and Brokers – Organizations that mainly work to bring suppliers and buyers together in exchange for a fee. and in turn sell these to other resellers. and order processing. Specialty Service Firms Hindustan Unileaver Limited that provide additional services to help with the exchange of products but generally do not purchase the product (i. such as retailers or other wholesalers.These organizations can be classified into several sub-categories including: Retailers – Organizations that sell products directly to final consumers..

Channels differ based on the type of channel members involved in cooperation and the extent to which members cooperate. Channel information systems have also influenced the structure of distribution channels. Information is easily available to all channel members. Different channel systems include consensus systems. Channel members have opted for collective goals over individual goals and have started looking for benefits to the channel as a whole. horizontal systems and inter-type systems. Coordination and cooperation among channel members have greatly improved due to CIS. resulting in an increase in trust and commitment. They add value to the distribution function and enable channel members to integrate different channel functions. stored and transmitted between channel members. Lengthy channels have given way to shorter and highly efficient distribution systems. Channel cooperation and coordination have led to successful and profitable relationships at different levels in the channel – between manufacturers and suppliers. suppliers and retailers and between manufacturers and retailers.Benefits of Technology used in channel management Information technology has made a big difference to channel operations and management. Information systems have revolutionized the way information is collected. which was not possible in conventional distribution systems. vertical systems. 21 .

Functional Process Integration External Integration Factors Driving Supply Chain Integration Increasing Customer Satisfaction Improving Supply Chain Productivity Changing Competitive Environment Role of Organizational and Channel Support for Supply Chain Integration 22 .Ways and Means of Supply Chain Management Nature of Supply Chain Integration Cross .

There are two types of supply chain integration-internal integration which aims at achieving the integration between functional areas. We first discussed the nature of supply chain integration. The process of achieving effective supply chain integration. 23 . and external integration which aims at integrating the internal operations of the firm with that of its supply chain partners. An integrated supply chain can be defined as one which has achieved alignment of the members of the supply chain and their processes.Effective supply chain integration enables firms to improve efficiency and effectiveness of their supply chain.

o Zero Level. o Three Levels. 24 ... o One Level. Which contain following o Agent o Distributor o Retailer o Distribution service firms. There are some channel Levels adopted by. • As Hindustan Unileaver ltd adopted Hybrid Integration which benefited customer by getting various kinds of products with schedule.CONCLUSION • Through this study I understood the process of Hindustan unilever ltd. o Two Levels. • In Hindustan Unileaver ltd.

co.in  www.REFERENCES  Retail Management.com  25 .com www.supplychain management.wikipedia.com  www.hul.  sales and Distribution.google.  www.

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Thank You 27 .

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