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HINDUSTAN UNILEVER LIMITEDAbout the company

Hindustan Unilever Limited (abbreviated to HUL), formerly Hindustan Lever Limited, isIndia's largest consumer products company and was formed in 1933 as Lever Brothers India

Limited. It is currently headquartered in Mumbai, India and its 41,000 employeesareheaded by Harish Manwani, the non-executive chairman of the board. HUL is the marketleader in Indian products such as tea, soaps, detergents, as its products have become dailyhousehold name in India. The Anglo-Dutch company Unilever owns a majority stakeinHindustan Unilever Limited.

The company was renamed in late June 2007 to "Hindustan Unilever Limited" to provide the

optimum balance between maintaining the heritage of the Company and the future benefitsand synergies of global alignment with the corporate name of "Unilever". This decision willbe put to the Shareholders for approval in next "Annual General Meeting". HUL isoneamong those companies in the country that derives huge revenues (over 50 per cent) fromthe rural areas. Hindustan Unilever Limited (HUL) is India's largest Fast MovingConsumerGoods company, touching the lives of two out of three Indians with over 20 distinctcategories in Home & Personal Care Products and Foods & Beverages. They endow th

ecompany with a scale of combined volumes of about 4 million tonnes and sales ofnearlyRs.13718 crores.

HUL is also one of the country's largest exporters; it has been recognised as aGolden SuperStar Trading House by the Government of India. The mission that inspires HUL's over15,000 employees, including over 1,300 managers, is to "add vitality to life." HUL meetseveryday needs for nutrition, hygiene, and personal care with brands that help p

eople feelgood, look good and get more out of life. It is a mission HUL shares with its parentcompany, Unilever, which holds 52.10% of the equity. The rest of the shareholding isdistributed among 360,675 individual shareholders and financial institutions.HUL's brands - like Lifebuoy, Lux, Surf Excel, Rin, Wheel, Fair & Lovely, Pond's, Sunsilk,Clinic Plus, Pepsodent, Close-up, Lakme, Brooke Bond, Kissan, Knorr-Annapurna, KwalityWall's are household names across the country and span many categories - soaps,detergents, personal products, tea, coffee, branded staples, ice cream and culinary

products. They are manufactured over 40 factories across India. The operations involve over

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2,000 suppliers and associates. HUL's distribution network, comprising about 4,000 redistribution stockists, covering 6.3 million retail outlets reaching the entire urban population, and about 250 million rural consumers.

HUL has traditionally been a company, which incorporates latest technology in all itsoperations. The Hindustan Unilever Research Centre (HURC) was set up in 1958, an

d nowhas facilities in Mumbai and Bangalore. HURC and the Global Technology Centres in Indiahave over 200 highly qualified scientists and technologists, many with post-doctoralexperience acquired in the US and Europe.

HUL believes that an organisation's worth is also in the service it renders to the community.HUL is focusing on health & hygiene education, women empowerment, and watermanagement. It is also involved in education and rehabilitation of special or underprivileged

children, care for the destitute and HIV-positive, and rural development. HUL has alsoresponded in case of national calamities / adversities and contributes through variouswelfare measures, most recent being the village built by HUL in earthquake affectedGujarat, and relief & rehabilitation after the Tsunami caused devastation in South India.HUL has changed its strategy towards rural markets in order to tackle its somewhat flatgrowth in these areas. As against its earlier strategy of each business divisiondealing withthe rural market on an individual basis, the multinational has now adopted a sin

gleorganisational-push approach to achieve greater penetration and sales. HUL derives over 40per cent of its sales from rural India, which makes this part of the market a critical growthaspect for the company.The company is now looking at the rural market from anorganizational point of view rather than from the individual businesses point ofview. Thisapproach is expected to lead to better cohesion, greater push and deeper penetration,which would eventually lead to better sales. Several of HULs major business categories such as fabric wash, personal wash and beverages already get over 50 per cent oftheirsales from rural areas.However, officials say that it is not enough that individual business divisionspush their ownstrategies for the rural market, adding the company would have to work in unisonin orderto achieve a balanced growth.Example of HULs rural marketing strategy:-A unique example is Hindustan Lever's Lifebuoy soap. In rural India, health is of paramountimportance, because indisposition is very directly related to loss of income. Lifebuoy, whose

core equity is health and hygiene, has for decades now been synonymous with soapin ruralIndia.

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At the same time, if products have to come up the order in the rural purchase hierarchy,they have to be affordable. If rural India today accounts for about half of detergents sales,it is because HUL has developed low-cost value-for-money branded products, likeWheel.

The company has also taken initiatives to create markets even for apparently premiumproducts, by offering them in pack sizes, like sachets, whose unit prices are within the reachof rural consumers. For example, initiated in the 1980s, sachets (Rs.2, Re.1, or50 paise)today constitute about 55% of Hindustan Lever's shampoo sales. With media reachgradually increasing, rural consumers today, where the media has its footprints,share thesame aspirations with their urban counterparts. HUL has responded to the trend with lowunit price packs of even other products - Lux at Rs.5, Lifebuoy at Rs.2, Surf Ex

cel sachet atRs.1.50, Pond's Talc at Rs.5, Pepsodent toothpaste at Rs. 5, Fair & Lovely SkinCream atRs.5, Pond's Cold Cream at Rs.5, Brooke Bond Taaza tea at Rs.5.HUL Penetration in Rural Market:-

The First major step taken by HUL to penetrate the rural market is that it evolved itsdistribution model. Secondly in 1998 HULs personal products unit initiated Project Bharat,the first and largest rural home-to-home operation to have ever been prepared byanycompany.

The project covered 13 million rural households by the end of 1999. Along with OperationBharat, HUL conceptualized Project Streamline to enhance its control on the rural supplychain through a network of rural sub-stockists based in these villages. This gave thecompany the required competitive edge, and extended its direct reach to 37 per cent of thecountrys rural population. Then HUL started Operation Harvest which was used as amedium of communication with the villagers. During these exercise, vans from HULand itsdistributors did the rounds of 30,000 villages giving promotional packs, showingproductsads and identifying key retail and distribution points.

The principal issue in rural development is to create income-generating opportunities for therural population. Such initiatives are successful and sustainable when linked with thecompanys core business and is mutually beneficial to both the population for whomtheprogramme is intended and for the company. Based on these insights, HUL launchedProjectShakti in the year 2001, in keeping with the purpose of integrating business int

erests withnational interests. Today Hindustan Unilever Ltd has more than doubled its direct rural