Aashi Arya | PGP13003 | Section A

Contribution of Project Shakti to HUL’s bottom line

 HUL had introduced low unit price packs(LUPs) which made low penetration
products affordable for low income group people.
 Another extension of Project Shakti was Project Vani where in a local woman was
appointed as Vani, trained and experted in matters of health and hygiene. This Project
was a communication program aimed at spreading awareness of health and hygiene
practices in rural India.
 Providing better margins to women entrepreneurs of the bottom line by allowing them
to sell directly to consumers and also making them self-sustained.
 iShakti was another Project Shakti initiative implemented to bring Internet connection
to the villages that had never seen a computer.
 Build communication channels in media dark regions
 Project Shakti helped develop a customer base for HUL that has a self-motivated team
of sales representatives who can penetrate into the untapped rural markets

Social value of Project Shakti

 Increase in the standard of living of people in rural India. It led to an increase in the
disposal income of rural households by almost 50%
 Increase in the health and hygiene awareness in rural households
 iShakti- empowering the local community by providing access to information
 Empowerment of women by making them entrepreneurs
 The connection between community and business is important as it develops
customers for a lifetime. HUL did the same which also enhanced their image as a
socially responsible company

Challenges

Shakti was a win-win initiative and HUL knew that it needed to overcome challenges on a
number of fronts.

 The team at HUL had to figure out a way to double the number of entrepreneurs
without significantly increasing the number of people who managed them.
 In 12 states where Shakti now operated, the Shakti model had received varying degrees
of support from the different state governments, with very close cooperation in five of
them, as compared to Andhra Pradesh where the state government had actively
endorsed it.
 Prosperity levels varied widely across different states, and this affected the viability of
Shakti entrepreneurs.
 The level of infrastructure impacted accessibility to villages.
  The status of women in rural society differed across states. For example, women in
Andhra Pradesh were far more independent than those in some northern states.
In some districts, it was almost impossible for a woman to venture out of her home and
try to sell products to other homes or to male retailers in the village.
 Wide differences in the dialects prevalent in neighboring districts made it difficult for a
rural sales promoter to work effectively across a state.
 Also they had to deal with the challenge of developing self-confidence and enterprise
among barely literate underprivileged women in a severely male-dominated society to
prevent them from getting demoralized after a few initial rejections.
 They realized they needed a formal training program to equip the Shakti entrepreneurs
with the skills and confidence required to manage a viable business.
 They also faced a challenge in finding a brand managers to invest in the Project. They
had to convince the brand managers to pick up much of Shakti’s promotion and brand-
building costs.
 Also women had unsold stocks worth thousands of rupees stacked up in their homes
and they were also to pay back the loan they had availed of to buy these stocks.
Women who had never undertaken any independent economic activity regretted their
decision of becoming Shakti.

The benefits of Project Shakti were:-

 It empowered women by improving their social status

 Gave people access to hygienic products and thus improved health conditions
 It enabled women to acquire education and entrepreneur skills in the process
 HUL earned profits through Project Shakti as it taped the Below Poverty Line
market, which was an untapped market earlier.
 HUL through this project was able to manage it’s CSR goals by empowering people
to come out of poverty

Had the project not been profitable revenue wise, HUL should continue with it, as the social
benefits resulting from this profit outweigh the costs involved in it. The development of the
sachet revolutionized the FMCG industry. Products that had suffered very low penetration
among lower- income groups were now affordable to these consumers.