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Project Report
On Study of supply Channel Management of Hindustan Unilever Limited.

Submitted By

Partho mukherjee PGDM (operations) Sem 3rd


under the guidance of mr. Vivek swami sinhgad institute of business administration&research

S. NO. 40/4A+4B/1 NEARPMCOCTROI POST, KONDHWA SASWAD ROAD, KONDHWA (BK) PUNE-411048 CERTIFICATE

This is to certify that Mr. /Ms PARTHO MUKHERJEE student of SINHGAD INSTITUTE OF BUSINESS ADMINISTRATION & RESEARCH; Pune has completed report of STUDY OF SUPPLY CHAIN MANAGEMENT OF HINDUSTAN UNILEVER LIMITED academic year 2009-11 He has worked under our guidance and direction. The said report is based on bonafide information.

PROJECT GUIDE NAME Prof. VIVEK SWAMI D. pol

DIRECTOR prof . Avadhoot

Date:-

Place:-

Declaration

I PARTHO MUKHERJEE of MMM-1V (2009-11), hereby declare that the project work STUDY OF SUPPLY CHAIN MANAGEMENT OF HUL Which has been submitted to SINHGAD INSTITUTE OF BUSINESS ADMINISTRATION & RESEARCH; is an original work of the undersigned and has not been reproduced from any other sources and has not been submitted to any University for any other award of degree or Scholarship.

Date: Signature of student Place: Partho Mukherjee

Acknowledgement

It gives me the great pleasure to express our deep sense of gratitude towards Prof. A. POL Director, of Sinhgad Institute of Business Administration & Research,, for his valuable guidance, inspiration, and wholehearted involvement during every stage of this project. His experience, perception and through professional knowledge, being available beyond the stipulated period of time for all kind of guidance and supervision and ever-willing attitude to help, whose embellished ideas helped us to blossom our endeavors without whose considerate approach and insight, this project would never have been possible and have greatly influenced the timely and successful completion of this project.

My special thanks to Prof. Vivek Swami., Project Supervisor of MMM-IV Department, for his/her support and invaluable assistance rendered towards presentation of this work.

Table of Contents
No 1 2. 3. 4 5. 6. 7. 8. Topic ACKNOWLEDGEMENT OBJECTIVE OF THE STUDY SUMMARY RESEARCH METHODOLOGY INTRODUCTION COMPANY INTRODUCTION OF STUDY CONCLUSION Page No. 04 06 07 08 09 12 23 24

REFERENCES

OBJECTIVE OF STUDY 1. To do the deep study of channel management adopted by Hindustan Unilever Limited. 2. To understand the types of channel management. 3. To understand the way how they make smooth their processes. 4. Which channel level is adopting by company? 5. What is the benefit to the customer from company`s channel management?

SUMMARY I am doing my management thesis on Distribution Channel management of Hindustan Unilever Limited. For smooth running Channel management is very important to every firm. Now a days FMCG sector is booming sector. In India there are very few organized retailer like P&G, ITC, and HUL etc. In it Hindustan Unilever Limited is one of the leading Organized Retailer. There are four types of P`s Product, Price, Place and Promotion. In this four P`s Place means Distribution .

Distribution Channel management means, this is one of the P from 4 P`s. frequently there may be a chain of intermediaries; each passing the product down the chain to the next organization, before it finally reaches the consumer or enduser. There are alternate channels of distribution channel may be available. I. II. III. IV. V. Direct sell. Agent Distributors Retailers. Brokers.

Distribution channels can thus have a number of levels. There are four types of distribution channels. I. II. III. Zero level. One level. Two level.
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IV.

Three level.

RESEARCH METHODOLOGY
Research Methodology is a way to systematically solve the research problem. The Research Methodology includes the various methods and techniques for conducting a Research. Marketing Research is the systematic design, collection, analysis and reporting of data and finding relevant solution to a specific marketing situation or problem". D. Slazenger and Mr. .Stephenson in the encyclopedia of Social Sciences define Research as "the manipulation of things, concepts or symbols for the purpose of generalizing to extend, correct or verify knowledge, whether that knowledge aids in construction of theory or in the practice of an art". Research Design Research design is an arrangement of conditions for collection of and analysis of data in a manner that aims to combine relevance to research purpose with economy of procedure. The research design will be descriptive in nature. Data Collection Data will be collected by two ways: Secondary Data This type of data has already been collected by someone else and has already passed through statistical process. The sources of secondary data are: Books Websites Magazines

INTRODUCTION OF COMPANY
Hindustan Unilever Limited (abbreviated to HUL), formerly Hindustan Lever Limited , is India'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 employees are headed by Harish Manwani, the non-executive chairman of the board. HUL is the market leader in Indian products such as tea, soaps, detergents, as its products have become daily household name in India. The Anglo-Dutch company Unilever owns a majority stake in Hindustan Unilever Limited. The company was renamed in late June 2007 "Hindustan Unilever Limited". BRANDS Some of its brands include Kwality Wall's ice cream, Lifebuoy, Lux, Breeze, Liril, Rexona, Hamam, Moti soaps, Pureit Water Purifier, Lipton tea, Brooke Bond tea, Bru Coffee, Pepsodent and Close Up toothpaste and brushes, and Surf, Rin and Wheel laundry detergents, Kissan squashes and jams, Annapurna salt and atta, Pond's talcs and creams, Vaseline lotions, Fair & Lovely creams, Lakm beauty products, Clinic Plus, Clinic All Clear, Sunsilk and Dove shampoos, Vim dishwash.

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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. Corporate purpose 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. Our deep roots in local cultures and markets around the world give us our strong relationship with consumers and are the foundation for our future growth. We will bring our wealth of knowledge and international expertise to the service of local consumers - a truly multi-local multinational. Our long-term success requires a total commitment to exceptional standards of performance and productivity, to working together effectively, and to a willingness to embrace new ideas and learn continuously. To succeed also requires, we believe, the highest standards of corporate behaviour towards everyone we work with, the communities we touch, and the environment on which we have an impact. This is our road to sustainable, profitable growth, creating long-term value for our shareholders, our people, and our business partners.

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Market Share of Hindustan Unileaver Limited

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INTRODUCTION OF STUDY
Meaning of Distribution Channel Frequently there may be a chain of intermediaries; each passing the product down the chain to the next organization, before it finally reaches the consumer or end-user. This process is known as the 'distribution chain' or the 'channel.' Each of the elements in these chains will have their own specific needs, which the producer must take into account, along with those of the all-important end-user. Alternate Channels A number of alternate 'channels' of distribution may be available: Selling direct, such as with an outbound sales force or via mail order, Internet and telephone sales Agent, who typically sells direct on behalf of the producer Distributor (also called wholesaler), who sells to retailers Retailer (also called dealer or reseller), who sells to end customers Advertisement typically used for consumption goods Distribution channels may not be restricted to physical products alone. They may be just as important for moving a service from producer to consumer in certain sectors, since both direct and indirect channels may be used. Hotels, for example, may sell their services (typically rooms) directly or through travel agents, tour operators, airlines, tourist boards, centralized reservation systems, etc.

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Channel Level Distribution channels can thus have a number of levels. Kotler defined the simplest level, which direct contact with no intermediaries involved, as the 'zerolevel' channel. The next level, the 'one-level' channel, features just one intermediary; in consumer goods a retailer, for industrial goods a distributor. In small markets (such as small countries) it is practical to reach the whole market using just one- and zero-level channels. In large markets (such as larger countries) a second level, a wholesaler for example, is now mainly used to extend distribution to the large number of small, neighborhood retailers or dealers. In Japan the chain of distribution is often complex and further levels are used, even for the simplest of consumer goods. In Bangladesh Telecom Operators are using different Chains of Distribution, especially 'second level'. In IT and Telecom industry levels are named "tiers". A one tier channel means that vendors IT product manufacturers (or software publishers) work directly with the dealers. A one tier / two tier channel means that vendors work directly with dealers and with distributors who sell to dealers. But the most important is the distributor or wholesaler.

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The internal market Many of the marketing principles and techniques which are applied to the external customers of an organization can be just as effectively applied to each subsidiary's, or each departments, 'internal' customers. In some parts of certain organizations this may in fact be formalized, as goods are transferred between separate parts of the organization at a `transfer price'. To all intents and purposes, with the possible exception of the pricing mechanism itself, this process can and should be viewed as a normal buyer-seller relationship. The fact that this is a captive market, resulting in a `monopoly price', should not discourage the participants from employing marketing techniques. Less obvious, but just as practical, is the use of `marketing' by service and administrative departments; to optimize their contribution to their `customers' (the rest of the organization in general, and those parts of it which deal directly with them in particular). In all of this, the lessons of the non-profit organizations, in dealing with their clients, offer a very useful parallel.

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Criteria for Selecting Channel Partners Sales Factors Product Factors Experience Factors Administrative Factors Risk Factors Motivating Channel Members Distributor Advisory Councils Evaluating Channel Members Modifying Channel Arrangements PLC Changes Growth of Multi-Channel Marketing Systems

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How HUL Recruit Their Channel Members?


To successful in the market HUL focus on core competencies and outsource other activities. Distribution channel is a key area that can be outsourced, but channel members have to be selected carefully .for selecting channel members, who suit the company`s requirement, careful recruiting and screening producer is essential.

Recruiting as a Continuous Process.


Recruiting channel member should be a continuous process for two reason one is that channel member may leave the organization .the other is that the organization might feel the need to change existing channel members. Therefore recruitment of channel member in HUL is continuous process. A change in HUL product policy may need new type of channel members. Alteration in customers test and preference will also influence the HUL to change existing channel members if they are unable to cater to the changed conditions. Managing channels is one of the most important dimensions of businesses across the world for improving their value in the market. Customers are constantly on the look out for convenience and service, when purchasing goods. Effective channel management helps companies decrease costs and reach potential customers profitably. Effective channel management involves proper recruitment of channel members. Recruiting channel members should be a continuous process. In the recruitment process, screening involves elimination of applicants who do not match the criteria set for the position. After effective screening, the Hindustan Unileaver Limited. has to make the final selection based on some criteria. These criteria can be divided into sales factors, product factors, experience factors,
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administrative

factors

and

riskfactors.

After selecting channel members, they have to be constantly evaluated and based on their performance, the Hindustan Unileaver Limited will either retain existing channel members or try to forge relationships with new channel members. Channel members can be evaluated by using parameters like sales quota attainment, average inventory levels, proper management of inventory, channel members cooperation in promotional and training programmers, etc. The distribution requirements of a company will keep changing according to changes in the product life cycle. Modifying channels accordingly is essential for the success of the organization. However, care should be taken in dealing with channel members for proper channel management. Conflict management among channel members is another important activity for the management of the Hindustan Unileaver Limited..

Channels of Distribution Of Hindustan Unilever Ltd`s


In the Business Buying Behavior Tutorial, we describe a supply chain as consisting of all parties and their supplied activities that help a marketer create and deliver products to the final customer. For marketers, the distribution decision is primarily concerned with the supply chains front-end or channels of distribution that are designed to move the product (goods or services) from the hands of the company to the hands of the customer. Obviously when we talk about intangible services the use of the word hands is a figurative way to describe the exchange that takes place. But the idea is the same as with tangible goods. All activities and organizations helping with the exchange are part of the marketers channels of distribution.

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Activities involved in the channel of Hindustan Unileaver Limited are wide and varied though the basic activities revolve around these general tasks: Ordering Handling and shipping Storage Display Promotion Selling Information feedback

Type of Channel Members


Channel activities may be carried out by the marketer or the marketer may seek specialist organizations to assist with certain functions. We can classify specialist organizations into two broad categories: Resellers and Specialty Service Firms. Resellers These organizations, also known within some industries as intermediaries, distributors or dealers, generally purchase or take ownership of products from the marketing company with the intention of selling to others. If a marketer utilizes multiple resellers within its distribution channel strategy the collection of resellers is termed a Reseller Network.

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These organizations can be classified into several sub-categories including: Retailers Organizations that sell products directly to final consumers. Wholesalers Organizations that purchase products from suppliers, such as manufacturers or other wholesalers, and in turn sell these to other resellers, such as retailers or other wholesalers. Industrial Distributors Firms that work mainly in the business-tobusiness market selling products obtained from industrial suppliers.

Specialty Service Firms Hindustan Unileaver Limited that provide additional services to help with the exchange of products but generally do not purchase the product (i.e., do not take ownership of the product):

Agents and Brokers Organizations that mainly work to bring suppliers and buyers together in exchange for a fee. Distribution Service Firms Offer services aiding in the movement of products such as assistance with transportation, storage, and order processing. Others This category includes firms that provide additional services to aid in the distribution process such as insurance companies and firms offering transportation routing assistance.

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Benefits of Technology used in channel management


Information technology has made a big difference to channel operations and management. Information systems have revolutionized the way information is collected, stored and transmitted between channel members. They add value to the distribution function and enable channel members to integrate different channel functions, which was not possible in conventional distribution systems. Channel information systems have also influenced the structure of distribution channels. Lengthy channels have given way to shorter and highly efficient distribution systems. Coordination and cooperation among channel members have greatly improved due to CIS. Channel members have opted for collective goals over individual goals and have started looking for benefits to the channel as a whole. Information is easily available to all channel members, resulting in an increase in trust and commitment. Channels differ based on the type of channel members involved in cooperation and the extent to which members cooperate. Different channel systems include consensus systems, vertical systems, horizontal systems and inter-type systems. Channel cooperation and coordination have led to successful and profitable relationships at different levels in the channel between manufacturers and suppliers, suppliers and retailers and between manufacturers and retailers.

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Ways and Means of Supply Chain Management


Nature of Supply Chain Integration Cross - Functional Process Integration External Integration Factors Driving Supply Chain Integration Increasing Customer Satisfaction Improving Supply Chain Productivity Changing Competitive Environment Role of Organizational and Channel Support for Supply Chain Integration

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Effective supply chain integration enables firms to improve efficiency and effectiveness of their supply chain. An integrated supply chain can be defined as one which has achieved alignment of the members of the supply chain and their processes. The process of achieving effective supply chain integration. We first discussed the nature of supply chain integration. There are two types of supply chain integration-internal integration which aims at achieving the integration between functional areas, and external integration which aims at integrating the internal operations of the firm with that of its supply chain partners.

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CONCLUSION

Through this study I understood the process of Hindustan unilever ltd. Which contain following o Agent o Distributor o Retailer o Distribution service firms.

In Hindustan Unileaver ltd. There are some channel Levels adopted by... o Zero Level. o One Level. o Two Levels. o Three Levels.

As Hindustan Unileaver ltd adopted Hybrid Integration which benefited customer by getting various kinds of products with schedule.

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REFERENCES
Retail Management.

sales and Distribution.

www.supplychain management.com www.google.co.in

www.wikipedia.com www.hul.com

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Thank You

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