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Identification of Problem
 High cost structure of HLL

 Unable to tap much of market in economy and popular

segment of the detergent market

 Doesn’t pay much importance to its ice cream and

beverages business

 Small growth in soaps and detergent market on YoY basis

Understanding of Problem
 HLL cost structure is high due to high overheads and stringent
quality parameters.

 HLL is leader in Premium brand detergents which constitutes

only 2% of the total detergent market volume, remaining market
( popular and economy segment) which constitutes 98% of total
detergent market is being tapped mostly by Nirma and
unorganised sector.
Solutions to problem
• Do market research to know the reasons of lesser sale of its
product in ice cream and beverage market

• To know reasons of small growth in its soaps and

detergent market on YoY basis.

• To produce more products for economy and popular

segment of the society.

• Upgrading consumers through innovation to new levels of

quality and performance
 Consumer understanding and systems for building
consumer insight.
 Distribution structure with wide reach, high quality
coverage and ability to leverage scale
 Integrated supply chain and well spread manufacturing
 Use of RSNet
 Penetrating into rural areas
 Giving employment to SHG
 Its well organised workforce
• Competitors focusing on a particular
product and eating up HLL’s share,
like Nirma focusing
on soaps and detergents
Innovative Thinking
• To enter untapped market in branded Ayurvedic
medicines and other such consumer products.

• Emerging Modern Trade can be effectively used

for introduction of more upscale Personal Care

• Opportunity in Food sector: changing consumer

1.What kind of sales organization should HLL
design for the current market
2.What factors should be taken into account while
evaluating the performance of the distribution channel
in providing support through sales force?

• Transportation Railways, Roads ,Waterways, Animals

• Communication ITC using internet, Mobile users
• Warehousing Central/State Warehousing , Cooperatives , Rural Godowns
• Market factors- competitors, geography, Economy.
• Product factors- life cycle, size & weight, product value, consumer perceptions,
product complexity.
• Manufacturer factors- company objective & Resources, Desire for
control,Breadth of product life.
• Organization objectives mass appeal and rapid marketing.
• buying habit of customers- Understanding consumer needs and criteria for buying
• Channel Availability - Channels may not be available
Activities involved in making
products available to
customers when and where
they want to purchasel
3.What kind of Sales organization
HUL should develop for Rural

Salesman Salesman Salesman

• Direct Coverage: HUL appointed a common stockist to
service all outlets within a town and sell a limited selection of
the brand portfolio.  Towns consisted of populations of under
50,000 people.
• Indirect Coverage: HUL targeted retailers in accessible
villages close to larger urban markets.  Retail stockists were
assigned a permanent route to ensure that all accessible
villages in the vicinity were served at least once a fortnight.
• Streamline: Streamline leveraged the rural wholesale
channel to reach markets inaccessible by road.  Star Sellers
were appointed among wholesalers in a particular village.  Star
Sellers would purchase stock from a local distributor and then
distribute stock to retailers in smaller villages using local
means of transport (e.g. motorcycles, rickshaws).
• Project Shakti: Project Shakti targeted the very small villages
(<2,000) and tapped into pre-existing women’s self help
groups (SHG).  Underprivileged rural women were invited to
become direct-to-consumer sales distributors for HUL products
4.Should HUL follow the same
organizational design with current
business strategy ?
• The current strategy is to straddle the pyramid —
portfolio of brands to cater to consumers across
income ,classes, meeting both needs and aspirations.
• As income levels rise, the number of affluent homes will
also increase rapidly, and so HUL have to augment their
portfolio to address these consumers.
• In that case HUL has to come up with new organizational
structure to serve huge market of INDIA