Distribution in HUL

8/2/2019 Distribution in HUL

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Presented By:

Ankur Mathur


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Sales & Distribution Network of Hindustan UniLever(HUL)

(Region: Kolkata)

A marketing channel performs the work of moving goodsfrom producers to consumers. It overcomes the time,place, and possession gaps that separate goods and

services from those who need or want them. Members ofthe marketing channel perform a number of key functionslike forward flow of activity from the company to thecustomers(goods) & backward flow from customers tocompany (order, Payment).

FMCG major HUL is the subsidiary of UNILEVER with amarket capitalization of $ 14 billion. HUL owns 35 of Indias150 most trusted & powerful brands and is Market Leaderacross categories

Fabric wash, Personal wash, Dish wash, hair wash, skinapplications, Talcum powders, packet tea, Jams2 Ankur Mathur


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The sales and distribution

challenge of HUL

HUL caters to Seven million distinct outlets across India (onefor every 29 households) and 59% of these stores are inrural India. HUL directly services over 1 million stores and

has a network of over 7000 Stockists and distributors.

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S & D of HUL in Kolkata

Hindustan Unilever in Kolkata covers the consumers mainly withthe combination of C&F and stockists who indirectly deal with theRetail outlets. The company which is headquartered in Mumbaihas appointed M/s Mitra Logistic Pvt. Ltd as the C & F agent for

Eastern region (West Bengal, Assam, Orissa & Bihar).

C & F agents can be classified into 2 types:

With investment and

Without investment.

The without investment C&F agents are mere Forwarding agentsand act as the transporter to the company. M/s Mitra LogisticPvt. Ltd is a forwarding agent on behalf of HUL. The C&F agentthen supplies the goods to the authorized stockists. TheseStockists are also classified into 2 categories called U1 and U2.

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U1 & U2

The stockists are classified as U1 and U2 stockist on thebasis of the products that they stock. E.g. U1 stockistgenerally stocks products like surf and ponds whereas the

U2 stockist deals with high profile products of HUL likeLakme and Dove. The stockiest in HUL system iscommonly referred to as Re Stockist (RS). In Kolkata thereare approximately 7 U1 Stockists and 5 U2 Stockists.These are appointed for a particular region of the city. Each

Stockist is then responsible for distributing the goods to theretail counters in his region. On an average Each Stockiestcaters to 700-900 retail outlets of the city. The retailers thenprovide the goods to consumers.

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U1 & U2

Then depending upon the type of products, sales, turnover andthe number of retail counters a stockist is dealing with, thecompany has classified the stores into:

Super Value Stores

Smart / FLO

Unicare

Vijeta

The stockist is also responsible for dealing with Modern retail

outlets like shopper stop and pantaloon. The stockist alsosupplies the goods to CSD Canteens and bills them for the sameand the difference in the amount is reimbursed by the company.

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Direct-to-Consumer Distribution

Project Sangam Direct- a non-store home delivery retailbusiness - was conceptualized (2001) and test marketed byHLL in Mumbai. Sangam operates a dedicated call centre

with trained personnel in Mumbai. The centre afterprocuring orders from customers passes them on forexecution to a network of re-distribution agents. Thismodel, which does not call for owning a physicalwarehousing or selling facility, offers the twin benefits of

convenience and value to its customers. HLL, afterunderstanding and analyzing consumer response, wantedto take the idea across the country.

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Sales force behind the Distributionchannel

The distribution channel cannot be successful without a goodsales force. In the case of HUL Kolkata the sales were co-ordinated by Area sales manager (ASM), Activation Manager(AM), and a Territory Sales In charge (TSI). These people were

working on behalf of HUL and were a Link between the stockistand the company. The goods moved to the stockists go-down bythe companys Truck. The stockist then appointed a (Re StockistSalesman) RSSM who was responsible for collecting the orders& payments from the retail outlets. The delivery is made byeither cycle or through a van depending upon the size of theorder. The lead time for delivery from the company was 1 day.The orders were placed online using the CRM software ofunilever called UNIFY.

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Evaluation/ Selection of ChannelMembers

The stockist are selected with a proper evaluation on thefactors like the investment capacity, Number of retail storescovered, Appropriate Sales force, and Infrastructure.

Companys policy is to work in advance payment mode. Toensure this the company maintained a stock of signedblank cheques of the stockist and these cheques werepresented to the bank upon the receipt of order andgeneration of the bill. Normally 20 cheque leaves were

maintained by the company and any decrease in this levelwas communicated to the stockist.

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Ecommerce Marketing Practices

The company heavily relies on Electronic means ofcommunications for running the business. The entire Salesand distribution channel is integrated through eCRM

software called UNIFY which are installed in every PCsystem of the C&F, Stockist. The company has up to daterecord of the inventory position of all the stockists. Astockist is required to maintain a minimum level ofinventory. If the stock position goes below a critical level

order is automatically triggered and the company sends thegoods to the stockist. All operations thus take place online.

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Unconventional Marketing

Channel

Looking at the booming retail sector of India and thesuccess of retail business of Pantaloon and shopper stop Iwould like to suggest a distribution channel on similar lines.

I would suggest that HUL opens a specialty store whichhouses all the brands of HUL under one roof. These storesshould be located near the strategic locations so that thepeople do not have to cover a long distance to reach thestore. Since HUL has a diverse product line it will a huge

success and it would be commercially viable also.

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Thank You

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Distribution in HUL

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