FMCG Sector

Assignment

Submitted by Rishab Mehta Enrollment A1802011421

Table of Content S no. 1 Title the overview of FMCG sector Page 3

Global leader from FMCG sector- HUL Part A Part B Part C Part D Part E

5 7 10 13 15 15

The overview of FMCG sector stating the sector outlook in India and in the global world. Answer 1
Fast Moving Consumer Goods (FMCG) goods are all consumable items (other than groceries/pulses) that one needs to buy at regular intervals. These are items which are used daily, and so have a quick rate of consumption, and a high return. FMCG can broadly be categorized into three segments which are: 1. Household items as soaps, detergents, household accessories, etc, 2. Personal care items as shampoos, toothpaste, shaving products, etc and finally 3. Food and Beverages as snacks, processed foods, tea, coffee, edible oils, soft drinks etc. Global leaders in the FMCG segment are Nestl, ITC, Hindustan Unilever Limited, Reckitt Benckiser, Unilever, Procter & Gamble, Coca-Cola, Carlsberg, Kleenex, General Mills, Pepsi, Gillette etc.

Overview of FMCG sector stating the sector outlook in India and in the global world.

The burgeoning middle class Indian population, as well as the rural sector, presents a huge potential for this sector. The FMCG sector in India is at present, the fourth largest sector with a total market size in excess of USD 13 billion as of 2012. This sector is expected to grow to a USD 33 billion industry by 2015 and to a whooping USD 100 billion by the year 2025. This sector is characterized by strong MNC presence and a well established distribution network. In India the easy availability of raw materials as well as cheap labour makes it an ideal destination for this sector. There is also intense competition between the organized and unorganized segments and the fight to keep operational costs low.

According to a study by the McKinsey Global Institute (MGI), 'Bird of Gold': The Rise of India's Consumer Market, Indian incomes are likely to grow three-fold over the next two decades and India will become the world's fifth largest consumer market by 2025, moving up from its 2007 position as the world's 12th largest consumer market. India ranks second in the Nielsen Global Consumer Confidence survey released on January 7, 2010an indication that recovery from the economic downturn is faster in India with consumers more willing to spend. The survey showed that in addition to the emerging markets of Indonesia and India, eight of the top ten most confident markets in The fourth quarter of 2009 came from the Asia Pacific region.

Answer 2 Global leader from FMCG sector- HUL

Hindustan Unilever Limited (abbreviated to HUL), formerly Hindustan Lever Limited, is INDIAs 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 as "Hindustan Unilever Limited". 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, Lakme beauty products, Clinic Plus, Clinic All Clear, Sunsilk and Dove shampoos, Vim dish wash, Ala bleach and Domex disinfectant,Rexona,Modern Bread and Axe deospray.HUL has produced many business leaders for corporate India. It is referred to as a CEO Factory' in the Indian press for the same reasons. Its leadership building potential was recognized when it was ranked 4th in the Hewitt Global Leadership Survey 2007 with only GE, P&G and Nokia ranking ahead of HUL in the ability to produce leaders with such regularity Today, HUL is one of Indias largest exporters of branded Fast Moving Consumer Goods. It has been recognized by the Government of India as a Golden Super Star Trading House. Over time HUL has developed into a viable & competitive sourcing base for Unilever worldwide in Home and Personal Care & Foods & Beverages category of products. HUL is also a global marketing arm for select licensed Unilever brands and also works on building categories with core country advantage such as branded basmati rice.

HUL Exports offers high level of service with flexibility and responsiveness thorough out the supply chain. It has a dedicated organization structure to support this endeavor and this has helped in growth of these businesses in particular. Intrinsic cost competitiveness in the end to end Supply chain with appropriate technology and competitive capital investment operations while delivering best in class quality enables HUL to position itself as a key sourcing hub for Unilever and also become a preferred partner for Global customers in categories we operate. HULs key focus in the exports business is on two broad categories. It is a sourcing base for Unilever brands in Home & Personal Care (HPC) and Food and Beverages (F&B) for supplies to other Unilever companies. It also focuses on becoming a preferred supplier to both non-Unilever and Unilever clients in three categories in which India, as a country, has competitive advantage Branded Rice, Marine Products and Castor and its Derivatives. HUL enjoys international recognition within Unilever and outside for its quality, reliability and speed of customer service.

HUL's Exports geography comprises, at present, countries in Europe, Asia, Middle East, Africa, Australia, and North America etc.

HULs products touches two out of three Indian everyday Reach 80% Households Direct Coverage of 1mln outlets 2000 Suppliers and Associates 71 Manufacturing locations 15000 Employees 1100 managers

Part A Complete product mix of HUL

Home and personal care

foods

personal wash laundry

skin care hair care oral care deodorants

colour cosmetic tea Coffee foods ice creams

surf Lux excel

fair & lovely

sunsilk naturals pepsodent axe lakme

brook bond Bru kissan kwality walls

lifebouy

rin

ponds

clinic plus

close up

rexona

knorr lipton anapurna

liril

wheel

hamam breeze dove Pears rexona

PRODUCT LINE

A) HOME AND PERSONAL CARE: 1) Personal wash Lux Lifebuoy Liril Hamam Breeze Dove Pears Rexona

2) Laundry Surf Excel Rin Wheel

3) Skin Care Fair and lovely Ponds Aviance

4) Hair care Sunsilk naturals Clinic

5) Oral care Pepsodent Close up

6) Deodorants 7) Colour Cosmetics Axe Rexona Lakme

8) Ayurvedic Personal and health care:

Ayush

9) FOODS a) Tea Brooke Bond Lipton b) Coffee Brooke Bond ,Bru c) Foods Kissan Knor Annapurna d) Ice cream Kwality walls

10) WATER PURIFIER Pureit

Part B Various ways to improve productivity Of HUL

Improving productivity is at the top of nearly every manufacturer's list but making it happen can be a challenge. There are some great methods that are proven to significantly improve productivity. One of the best is to measure, analyze and set goals for improvement. Only then can you work toward a logical plan for improving productivity. Then do it again and again until the process is where it needs to be. Here are a few great methods for improving your productivity: Increase Productivity with Real-Time Goals Monitor Small Stops and Reduced Speed Operation Tackling the Six Big Losses Reduce Changeover Time through Training and Awareness

STRATEGIES TO IMPROVE PRODUCTIVITY

Increase Productivity with Real-Time Goals PROBLEM Plant floor employees are informed of production goals when it is too late to act. STRATEGY Deliver real-time production goal information to the plant floor. Display a shift or job based goal. Additionally the target can be displayed in real-time as a count based on the product takt time. Actual count can also be shown as well as a calculated production efficiency and much more.

SOLUTION People respond to information that tells them where they are and where they should be in relation to production goals. Show the goal count, an actual count, a percent efficiency, pieces to goal, the estimated time to goal, a piece or time variance from goal, OEE Performance and more in any combination. Both the 87 Series 4" to 12" and XL Series Production Monitor displays are great choices for delivering real-time production goals to the plant floor.

Monitor Small Stops and Reduced Speed Operation PROBLEM Major downtime events appear to be under control however the process continues to miss target production. STRATEGY Get a handle on small stops and reduced speed operation (OEE Performance). SOLUTION Downtime is normally easy to identify because the equipment or process is simply not running, small stops and reduced speed operation, however is much more difficult to detect. What's worse is that these events, if logged, are often incorrectly logged making it difficult to identify and correct the problem. OEE Performance is a great tool for monitoring manufacturing performance. XL Series Production Monitor displays are capable of showing the number of small stops, reduced speed cycles, the time for each and OEE Performance. The results are often eye-opening when people find the slow leak in their production efficiency.

Tackling the Six Big Losses PROBLEM We are under constant pressure to make more with less. STRATEGY Tackle the Six Big Losses! SOLUTION The Six Big Losses represent the most common causes of efficiency loss in manufacturing. Knowing what they are and how to attack them is the key to swift and lasting improvement on your plant floor. XL Series Production Monitor displays expose real-time losses such as Down Time Loss (equipment failure, setup/changeover, etc.), Speed Loss (small stops, rough running, etc.) and Quality Loss (scrap, rework, etc) to enable teams to identify and correct problems when they occur.

Reduce Changeover Time Through Training and Awareness PROBLEM Changeover time is hurting production efficiency. STRATEGY Reduce changeover time significantly through training and awareness. Display the changeover time for all to see. Additionally, by showing the remaining pieces to goal or estimated time to job completion, operators can determine when to initiate internal set-up procedures. Internal set-up or those items which can be handled while running, is one of the greatest tools for minimizing changeover time.

SOLUTION Show time to completion by displaying either a pieces to goal count or an estimated time of completion based on the current run speed. Also display the changeover in-process time for all to see. Set goals to reduce the time required and use color-coded data to show the allowed changeover time in green and time overage in red. The 87 Series 4" to 12" and XL Series Production Monitor displays are great choices for reducing changeover time.

Part c

Marketing activities employed by the top players of this segment are as follow ITC Promotional activities A particular budget is allocated for the promotion of the products, the local promotion scheme is decided by the Area Sales Manager, it give its suggestion to the District office and that is forwarded to the Head Quarter in Kolkata.

P&G targets "high levels of marketing activity" The company is focusing on innovation and heightening its advertising expenditure, as it seeks to drive growth at a time when many consumers are displaying low levels of confidence.

Marketing strategies for HUL are as follow HUL FOR URBAN INDIA Adopted Total Productive Maintenance(TPM) to meet zero error, zero loss. Focuses on short supply chain for distribution. To meet the every needs of people everywhere. Also uses Direct selling channel(HUN), franchisee to reach everyone e.g. Aviance, Ayush. Build segments & market for the future where Unilever has strong expertise

FOR RURAL INDIA HUL should start some projects for rural India like it once did in 1997. Should Appoint some Sub-stockiest that directly covers about 50,000 villages & 250 million customers. Providing education on health and hygiene Women empowerment Water management Rehabilitation of special or underprivileged children Care for the destitute and HIV-positive Rural development. Plays active role in natural calamities

Part D Increasing rate of inflation is leading to higher cost of raw materials but at the same time Rise in disposable incomes is resulting in premium brands having faster growth and deeper penetration Because of this inflation the purchasing or spending power of consumer is also increasing as now they are able to purchase premium brands Good amount of inflation brings growth to the economy Lets take an example Now because of FDI in retail we are going to see that wallmart is going to invest in India, and because of this investment our economy will get lots of employment opportunities. Thus because of these investments the inflation will also go up which will result in high cost of raw material but these opportunities will also rise the power spending of consumer because now they are employed also and have an ability to spend.

Part E Major players of the sector will absorb the effect of packaging norms by the following manner Will give only large packs and will stop the use of small packages

companies may increase grammage