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HUL : Hindustan Unilever Limited
 

HUL : Hindustan Unilever Limited

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HUL : Hindustan Unilever Limited ...

HUL : Hindustan Unilever Limited
Mission & Vision
History
BCG Matrix, Porter’s 5 forces,
SWOT Analysis

Presentation By:
Amara Bandukada
Umme Baba
Arul Collins
Anand Sawji
Ayush Parekh

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    HUL : Hindustan Unilever Limited HUL : Hindustan Unilever Limited Presentation Transcript

    • Hindustan Unilever Limited A Management Process Presentation
    • Introduction Definitions of BCG Matrix, Porter’s 5 forces, SWOT Analysis
    • Introduction  Boston Consulting Group (BCG) Matrix is developed ny BRUCE HENDERSON of the Boston Consulting Group in the early 1970s.  According to this technique, businesses or products are classified as low or high performers depending upon their market growth rate and relative market share.
    • BCG Growth-Share Matrix  It is a portfolio planning model which is based on the observation that a company’s business units can be classified to four categories:  Stars  Question Marks  Cash Cows  Dogs It is based on the combination of market growth and market share relative to the next best competitor.
    • Advantages  This matrix helps to manage and organize company portfolio and strategies.  These matrix is use full for small and large business volume.  It helps us to take effect action for our business as well as we can make future planning too.  We make our product marketing and manufacturing plan according to the result that show in graph.
    • Disadvantages  This matrix ignores the synergic effects of business factors.  If a company has high market shares then it is not a success full business, there must be equal level of business growth factor and vice versa.  Not every dog’s quadrant is bad sometimes it give you more profit than cash cow.  We cannot get 100% accurate our market result, because some market has sudden change property.  Sometimes low market share also give you benefits.
    •  Named after Michael E. Porter, this model identifies and analyzes 5 competitive forces that shape every industry, and helps determine an industry's weaknesses and strengths. 1. Competition in the industry 2. Potential of new entrants into industry 3. Power of suppliers 4. Power of customers 5. Threat of substitute products Definition of 'Porter's 5 Forces:
    • Porters 5 forces:
    • Advantages  Helps to shape our strategy to survive.  Lowers risk.  Identify supplier power.  Helps to build good customer relationship.
    • Disadvantages  Pace of change is now more rapid.  Market structures were seen as relatively static.  The model provides you with only a snapshot of your environment.  It can be difficult to define the industry  The model does not consider non-market forces  The model is most applicable for analysis of simple market structures.  The model is based on the idea of competition.
    • SWOT Analysis  SWOT analysis (alternatively SWOT Matrix) is a structured planning method used to evaluate the Strengths, Weaknesses, Opportunities, and Threat s involved in a project or in a business venture.  A SWOT analysis can be carried out for a product, place, industry or person.  It involves specifying the objective of the business venture or project and identifying the internal and external factors that are favorable and unfavorable to achieving that objective.
    • SWOT Analysis
    • Advantages  It is a source of information for strategic planning.  Builds organization’s strengths.  Reverse its weaknesses.  Maximize its response to opportunities.  Overcome organization’s threats.  It helps in identifying core competencies of the firm.  It helps in setting of objectives for strategic planning.  It helps in knowing past, present and future so that by using past and current data, future plans can be chalked out.
    • Disadvantages  Focusing too much on strengths can lead to ignorance of one's flaws and can eventually lead to the weakening of one's business.  Focusing too much on weaknesses can lead to the neglecting of strengths or cause a person too look down on their business.  Missing opportunities is basically a missed chance to possibly get a business known. Not all opportunities can help. You have to think if you'll benefit positively in the long run.  The basic idea with threats is that if you don't know them harm will come if not sooner, then later.
    • HUL  India’s largest FMCG Company.  Parent Company (Unilever) has a presence in over 100 countries and employs more than 174,000 people worldwide.  Headquartered in Mumbai (HUL).  More than 200 highly qualified scientists and technologists.  Listed at BSE and NSE
    • History & Present Position  The Company was incorporated in 1933 but its products have been sold in India since 1888.  The Group has more than 400 brands spanning 14 categories of home, personal care and food products  HUL touches the lives of two out of every three Indians everyday.  Over 700 million consumers  More than 15,000 employees, including 1,300 managers
    • Organization Structure
    • Board of Directors
    • Mission Unilever’s mission is to add Vitality to life. We meet everyday needs for nutrition, hygiene, and personal care with brands that help people feel good, look good and get more out of life.
    • Vision  We work to create a better future every day.  We help people feel good, look good and get more out of life with brands and services that are good for them and good for others.  We will inspire people to take small everyday actions that can add up to a big difference for the world.  We will develop new ways of doing business with the aim of doubling the size of our company while reducing our environmental impact.
    • Financial Performance
    • Performance Analysis
    • Brands under HUL More than 400 brands under HUL but about main 30 are taken up for research and presentation.
    • BCG Matrix
    • (a) Entire FMCG Sector Market Growth Rate = 13% GROWTH RATE SEGMENT/SECTORS Excellent growth of above 20 percent (>20%) Deodorant 41.5% (40%) Tooth paste 22% (20%) Men’s Fairness product 32% (32%) Hair colorants/dies 22% (21%) Cleaners and repellents 23% (22%) Dish wash 27% (26%) High growth rate of 10 to 20 percent (10-20%) Skin and fairness cream 18% (16%) Detergent powder 16% (15%) washing cakes 13% (13%) toilet soaps 16% (15%) tooth brush 13% (13%) shampoos 12% (9.8%) skincare 15% (15%). Moderate growth of 0 to 10 percent (0-10%) Toothpowder 1.8% (2%) Liquid soaps 7% (6%) Shaving products 8% (7%) coconut oil 2% (2%)
    • (b) Relative Market Share Data RELATIVE MARKET VALUE = Market Share of the Product Market Share of the Largest Competitor
    • SR. NO. INDUSTRY HUL PRODUCT AND ITS MARKET SHARE (C1) LARGEST COMPETITOR AND ITS MARKET SHARE (C2) RELATIVE MARKET VALUE (RMV) =C1/C2 1. DEODRANT AXE Deodorant (25%) Fa (8.5%) 2.94 2. TOOTHPASTE Close Up and Pepsodent (32.8 %) Colgate - Palmolive (52.4%) 0.62 3. FAIRNESS CREAM Fair & Lovely (76%) Cavin Kare’s {Fairever} (15%) 5.06 4. MEN’s FAIRNESS CREAM Fair & Lovely Menz Active (<5%) Emami {Fair&Handsome} (Almost 70%) 0.04 5. FLOOR CLEANER Domex (10.5%) Reckitt {Harpic} (80%) 0.13 6. DETERGENT BAR Rin (4.2%) Nirma (35%) 0.12 7. DETERGENT Wheel Nirma {Ghari} 1.54
    • 8. DETERGENT POWDER Surf (35%) Wheel (20.83%) 1.68 9. TOILET SOAP Lifebuoy (18.4%) Lux (15.5%) Nirma (10%) Nirma (10%) 1.84 1.55 10. SHAMPOO Dove (7.9%) Clinic Plus (21.1%) Sunsilk (15.8%) Pantene (9.4%) Pantene (9.4%) Pantene (9.4%) 0.84 2.24 1.68 11. ATTA Annapurna (26%) ITC {Ashirwad} (40%) 0.65 12. TEA BAG Taj Mahal (25%) Tata Tetley (56%) 0.44 13. MOISTURISING CREAM Vaseline (55.6%) Nivea (20.2%) 2.75 14. FOOD Kissan Ketchup (26%) Maggi Ketchup {Nestle} (47%) 0.55
    • (c) RELATIVE SEGMENT’S SALES DATAPRODUCTS’ SEGMENT TOTAL SALES OF HUL SALES OF PRODUCTS IN 2012-13 SALES OF PRODUCTS AS % OF TOTAL SALES Soaps and Detergents 20,018.51 8,791.56 44.6 Personal Products 20,018.51 5,844.10 29.7 Beverages 20,018.51 2,343.97 11.9 Foods 20,018.51 902.57 4.6 Ice Creams 20,018.51 274.58 1.4 Exports 20,018.51 1,171.79 5.6 Others 20,018.51 656.05 2.2 (In Crores)
    • PRODUCTS’ SEGMENT SALES OF PRODUCTS IN 2012-13 SALES OF PRODUCTS IN 2011-12 % OF GROWTH IN EACH SEGMENT Soaps and Detergents 8,791.56 8,265.64 6.168501 Personal Products 5,844.10 5,047.90 14.64603 Beverages 2,343.97 2,142.43 8.990537 Foods 902.57 730.78 21.11338 Ice Creams 274.58 231 17.28249 HUL Sales Comparison with the Base Year (In Crores)
    •  MARKET GROWTH RATE ANALYSIS As we had analysed in the beginning the entire FMCG market Growth rate which is 13%, thus this 13% benchmark will be used to distinguish between the industries (w.r.t. HUL’s products) with high growth rate and low growth rate. High Growth Rate Industries Low Growth Rate Industries Deodorant Tooth Paste Skin And Fairness Cream (MEN & WOMEN) Cleaners Dish Wash Detergent Powder Toilet Soaps Processed Food Packed Wheat Flour Tea Bags Washing Cakes Shampoos Toothpowder Liquid Soaps Shaving Products Jam & Jellies Moisturizing Creams Packed Branded Tea Coffee
    •  RELATIVE MARKET SHARE ANALYSIS The market leader position occur when the relative market value crosses 1.0 because then the organisation’s market share in terms of sales is above that of its largest competitor. The bigger the value (>1.0) the higher market share that product has and is more preferably placed on the extreme of the BCG matrix. High Market Share Low Market Share AXE Deodorant Fair & Lovely Fairness Cream Wheel Surf Excel Lifebuoy Lux Clinic Plus Sunsilk Vaseline Kissan Jam Vim Kwality Walls Lipton Red Label Knor Soups Close Up Pepsodent Fair & Lovely Menz Active Domex Rin Dove Shampoo Annapurna Taj Mahal Tea Bags Kissan Ketchup Bru Breeze Taaza Brooke Bond Sehatmand Knor Meal Maker Range
    • On the basis of above mentioned analysis, almost every product of HUL is being analysed against the industry to which it belongs and then placed in one of the 4 quadrants of BCG matrix…
    • STARS QUESTION MARKS AXE Deodorant Fair & Lovely Lakme Anti Ageing Vim Wheel Surf Excel Lifebuoy Lux Kwality Walls Kissan Jam Knor Soup Close Up Pepsodent Annapurna Fair & Lovely Menz Active Domex Rin Breeze Taj Mahal Tea Bags Kissan Ketchup Knor Meal Maker CASH COWS DOGS Clinic Plus Sunsilk Vaseline Red Label Taaza Brooke Bond Sehatmand Bru HIGH LOW HIGH LOW
    • SWOT Analysis Strengths, Weakness, Opportunities and Threats for Hindustan Unilever Limited.
    • Strengths  HUL is a part of the Unilever group, hence strong brand equity  It has over 15000 employees  Reach 6.4 million retail outlets which includes direct reach to over 1.5 million retail outlets  Two R&D centres in India in Mumbai and Bangalore  Products with presence in over 20 consumer categories with over 700 million Indian consumers using its products  As a part of CSR, HUL has initiatives like project Shakti, plastic recycling, women empowerment etc
    • Weakness  Market share is limited due to presence of other strong FMCG brands.  HUL products has stiff competition from big domestic players and international brands.  High advertising cost due to large number of products.  Loseing of market share in segments including soaps, hair, oral & skincare.
    • Opportunities  Tap rural markets and increase penetration in urban areas.  Mergers and acquisitions to strengthen the brand.  Increasing purchasing power of people thereby increasing demand.  Diversification can enter new segments like medicines and confectionery etc.
    • Threats  Intense and increasing competition amongst other FMCG companies.  FDI in retail thereby allowing international brands.  Competition from unbranded and local products.  Increasing tax rate and other duites increase’s cost and direct effect on the sale of the product.
    • Competitors  1. Marico  2. L'Oréal  3. Nirma Ltd  4. ITC  5. Colgate-Palmolive  6. Procter and Gamble  7. Dabur
    • PORTER’S FIVE FORCES MODEL
    • THREAT OF NEW ENTRY • It does not have any measures which can control the entry of new firms. • The resistance is low and the structure of the industry is complex.
    • • Bargaining power of consumer is very high. • Customers are never reluctant to buy or try new things off the shelf. BUYERS POWER
    • • The bargaining power of suppliers of raw material and intermediate goods is not very high. • There is no monopoly situation in the supplier side. SUPPLIER POWER
    • • There are complex and never ending consumer needs and no firm can satisfy all needs alone. • This leads to higher consumer expectation. Threat of substitution
    • • In HUL , rivalry among competitors is fierce. • Market players use all sort of tactics and activities. Competitive rivalry
    • Conclusion • Increased focus on farm sector will boost rural incomes. • Better infrastructure will improve the supply chain. • If the company can able to change the mindset of consumers, then they would generate higher growth in near future.
    • Presentation By: Source:  Definitions: Wikipedia and Google.  History, About HUL, Data and Statistics: www.hul.co.in  Reference for BCG: www.marketing91.com www.studymode.com www.papers.ssrn.com www.academia.edu  SWOT and 5 forces: Research by Team.  Guidance: Miss Andrea David Ayush Parekh Anand Sawji Arul Collins Amara Bandukada Umme Baba
    • Thank You! A Management Process Presentation