Hindustan Unilever Limited or HUL as it is popularly known as started its journey in the Indian soil long back in the year 1933. So, this year the company is celebrating its 75th year’s anniversary. In the beginning the name of the company was ‘Lever Brothers India Limited’. Then, in 1956 ‘Hindustan Lever Limited’ (or more popularly HLL) was formed with the merger of three companies namely ‘Lever Brothers’, ‘Hindustan Vanaspati Mfg. Co. Ltd.’ and ‘United Traders Ltd.’. In June 2007, the company was renamed to ‘Hindustan Unilever Limited’. Unilever, the anglo-dutch parent of HUL has 52% stake in it.
Though in this blog we discussed ITC before HUL because of ITC’s higher market capitalization, HUL is the undisputed market leader in the FMCG segment. This is evident from the following figures showing HUL’s market share across categories in the FMCG segment:
HUL products are a household name in India. Its brands across categories touch lives of over 700 million Indian consumers every day. That means roughly two-third of Indian population uses HUL products. The two biggest strengths of HUL are: its leading brands and extensive distribution network.
a) Brands: HUL has around 35 major brands most which are leaders in their individual categories. In the year 2008 AC Nielsen-Brand Equity list of 100 Most Trusted Brands Annual Survey featured 16 HUL brands. HUL consistently has highest number of brands in top 50 or top 10 Indian brand’s list.
b) Distribution Channel: HUL products are manufactured in over 40 factories across India. Over 2000 suppliers and associates are involved in its operations. The giant HUL distribution network comprises of around 4000 redistribution stockists and 6.3 million retailer outlets. The wide-spread distribution network reaches almost entire urban India and around 250 million rural consumers. With the introduction of ‘Hindustan Unilever Network’ in 2003 – HUL is trying its hand at ‘Network Marketing’. Lately, HUL’s Shakti program (website: www.hllshakti.com) which supports rural women to become entrepreneurs and sell HUL products in villages increases the reach of HUL and provides it a unique capability to tap the still unexplored bottom-of-the-pyramid opportunities. Of late, HUL is trying to reduce the inventory requirements by unbundling the distributors. As per the pilot project in Mumbai, number of distributors has decreased drastically from 22 in 2007 to only 5 in 2008.