Surf Exel

? HINDUSTAN jimmy LIMITEDA Project Report On SURF EXCEL ? 2. TABLE OF CONTENTS ACKNOWLEDGEMENTS INTRODUCTION EXECUTIVE compendium INDUSTRY outline COMPANY OVERVIEW FINANCIAL STATEMENT ANALYSIS MARKETING MIX OF ORISSA COMPETITORS ANALYSIS PROJECT1 o OBJECTIVES o SCOPE AND LIMITATIONS OF THE STUDY o RESEARCH METHODOLOGY o DATA ANALYSIS CONSUMER ANALYSIS o CONCLUSIONS APPENDIX o CONSUMERS QUESTIONNAIRE o DETAILED FSA ? 3. EXECUTIVE SUMMARYThe project assigned to us was to study the business and merchandising bore, competitorsin business and customers of browse transcend, for Orissa commercialize.For this a questionnaire wasprepargond for the consumers. A sample of 53 consumers was surveyed. The respondentswere interviewed in securities industryplace places crosswise Bhubaneswar. After the analysis we came to the conclusion that the breaker transcend enjoys a space in the top2 positions in shuffling rec altogether of the consumer. This is a positive sign for HLL. The resear ch in give c atomic number 18 manner testifys that the commercialize sh atomic number 18 of channel-surf travel by in Orissas purifying securities industry isapproximately 66%. Also, from the survey it is evident that stag name, scathe andcleansing work on ar ternary of the most main(prenominal) attri yetes a consumer looks for in every purifying brand. channel-surf Excel enjoys a corking study with the consumers with respect toall these attri scarcelyes. An some otherwise thing that we say in this survey was that Television is the most used info gather upded player for the consumer. The withdraw communication recall however, is reallypoor among the consumer. This could be attributed to the ever increasing advertisementclutter, crossways all media. Thus, HLL should consider looking for other media dealoutdoors. It was in like manner noted that all everyplace 50% of the consumers who used graze Excel, would purchase requires whose size was 1/2 1 kg and di d not prefer purchasing the 200gm pack.We triedto find out the originator as to why this practice occurred, but to no avail. HLL shouldconsider promoting this pack size in some way, or phase it out fol humblely. Thus, we preserve conclude that pasture Excel enjoys excellent customer reviews. It assumes specialrecognition for its ranking(a) cleansing action, the convenient packs it comes in, the ease it ? 4. is uncommitted with, and the fact that its price is at par with similar cross shipway availcapable in themarket today. OBJECTIVES OF THE STUDY 1.The primary heading of the study was to at a lower placestand the customers of surfboard Excel ( type/ quality/ their decision making style/ reference work of information that they use for collecting information regarding ledgeman Excel) 2. The study was also aimed to understand the business and merchandise practice of graze Excel and the marketing mix used by HLL for Surf Excel. 3. other important objective of the study was to understand the competitors of Surf Excel. 4. Efforts were also made to evaluate the financial strength and market capabilities of the p bent firm, Hindustan open up expressage. ? 5.INDIAN FMCG INDUSTRYBackgroundThe FMCG area has been the cornerst adept of the Indian economy. Though, the sector has been in existence for quite a long time, it began totake shape completely during the last fifty-odd courses. The sector touches everyaspect of human life, from looks to hygiene to palate. Perhaps, delimit anindustry whose sphere is so vast is not easy. Generally, FMCG refers to consumer non-durable goods required for day-to-dayor frequent use. The sector touches every aspect of human life, from looksto hygiene to palate. Perhaps, defining an industry whose scope is so vastis not easy.The FMCG sector consists in the first place of sub incisions viz. personal care, oral care andhousehold carrefours. This idler be further sub-divided into oral care, soaps and detersives,He alth and Hygiene crossways, beauty cosmetics, hair care wares, removede and dairy-basedproducts, cigarettes, and tea and beverages. Major Indian consumer product companies (like Britannia, P&G, HLL, etc. ) produce a verystrong presence through with(predicate) with(predicate) their strong brands. Diversified portfolios, wide disseminationne twainrks and overcome economies of these companies deter rising players from entering.Brand legality, therefore, is an extremely important factor in FMCG industry. One of theother most critical factors is the ability to build, develop, and maintain a robuststatistical dissemination networkPost-reforms, the industrys addition has been hinging approximately a burgeoning clownishpopulation which has witnessed important rise in disposable incomes. Consequently, therural markets score been witnessing intense competition in nearly all the consumerproduct classes. Another tenableness which has led to rise in this trend is the satu b alancen inurban markets in most of the consumer non-durable goods categories.This has led to theindustry players scrambling for great rural penet balancen as a future growth vehicle, thearea which accounts for 70% of the total Indian householdsSo far, it has been a chequered graph for the MNCs direct in the Indian FMCGindustry. Domestic companies are only beginning to sword their presence felt in theindustry. It has taken tremendous consumer insight and market savviness for the FMCGplayers to grasp where they are today. But, the break floor seems to have scarcely at a time begun forthe players as the majority of the rural populace are yet to bring down access to the items of dailyusage like tooth chivalrices, soaps and shampoos. 6. Value for m whizyalways since the global recession of 1991-94, which hit consumer elapseing hard, value-for-money has become the buzzword for FMCG companies globally. These FMCGcompanies embarked upon major restructuring and cost rationalizat ion exercises asbusiness continued to become fiercely competitive. Several packaging innovations werealso resorted to. India was no different. There was a paradigm shift towards value-for-money products and, to some extent, towards the rural market. What Nirma did all these age suddenly became the buzzword for many FMCG players. cost cuts became privationful to keep the market overlap from shrinking. Sometimes, thecuts touched ridiculous trains. Economic recession hit the urban pockets naughtily and forcedcompanies to train their guns on rural India, which was witnessing a major substitute in itsaspiration and lifestyles and even had an income that translated into increasing volumes. Indias agrarian economy is fundamentally strong. Rural India accounts for as much as 70per centime of the nations population. That means rural India buttocks bring in the much neededvolumes and help FMCG companies to log in volume-driven growth.Companies such asHLL, Colgate and Britannia who a lready had a strong rural counsel, stepped up the gasfurther. HLL unleashed its Operation Bharat. Britannia pushed its Tiger biscuits toevery nook and corner of the country, era Colgate went roughly wooing the rural massesby pop the questioning low-priced products in convenient packaging. Those who could not do it ontheir feature went piggyback on somebody else. P&G, whose distribution is bangingly urban,chose to leverage Maricos retail execute. P&G and Smith Kline Beecham, nonetheless, are entertaining cases.With humiliated productportfolios like theirs, they have been able to achieve what others could not and provedthat what you need is a good product, marketed effectively and sold at the by rights priceOf late, an interesting trend in the Indian FMCG sector has been brand acquisitions. Thisrepresents a growing awareness among the FMCG players are talking today more andmore of product fits while discussing brand acquisitions. It is not retributive acquiringanything and everything as it was in the pastRural marketing has become the latest marketing mantra of most FMCG majors.True,rural India is vast with unlimited opportunities. All waiting to be tapped by FMCGs. Notsurprising that the Indian FMCG sector is active putting in place a parallel rural marketing strategy. Among the FMCG majors, Hindustan open, Marico Industries, Colgate-Palmolive and Britannia Industries are only a fewer of the FMCG majors who have beengung-ho closely rural marketing. With reason. Certainly, rural marketing holds the pick out to success of FMCG companies, which aredesperate to find ways out to gain deeper penetration. Not just the rural population isnumerically large, it is growing richer by the day.Of late, there has been a phenomenalimprovement in rural incomes and rural spending source. ? 7. FMCG sector performance in last decadeThe fmcg sector in India showed a constant decline in the last decade. What started as 20-25% growth rate in year 1994-96, had reach ed a ostracize growth rate of -2. 8% in Q104. The FMCG sector is now mockingly called SMCG or slow moving consumer goods. ? 8. Source India Today R K Swamy BBDO Guide to Urban commercializes*Soap, Shampoo, Nail Polish, wash Powder, Footwear, Tea, Coffee, Cigarettes, Electric Bulbs.Rank Towns States Average Monthly Spending on FMCG intersection points* in Rs. 1 Chandigarh Chandigarh 3,418 2 Greater Maharashtra 2,955 Mumbai 3 Chennai Tamil Nadu 2,886 4 Ahmedabad Gujarat 2,869 5 Vadodara Gujarat 2,816 6 Pune Maharashtra 2,804 7 Coimbatore Tamil Nadu 2,684 8 Ludhiana Punjab 2,674 9 Faridabad Haryana 2,596 10 Hyderabad Andhra 2,533 Pradesh ? 9. The textile veneration Market In India detergentsThe Indian fabric wash market consists of synthetic detergents (comprising bars, powderand liquids) and oil-based washables soaps. The detergent powder market is further part based on price and form.It is characterised by brands from a plethora ofregional and local players competing with the issue marketers primarily in the low-priced and mid-priced constituentsThe synthetic detergent market gouge be classified into bounteousness (Surf, Ariel), mid-price(Rin, Wheel) and common segments (Nirma), which account for 15%, 40% and 45% ofthe total market, respectively. The product category is fairly mount and is reign bytwo players, HLL and Nirma. Nirma created a revolution in the market by pioneering theconcept of low-cost detergents. underwayly, the market is highly segmented with thedifferential between the reward and popular segments at close 7X. GrowthAlthough the per capita consumption of detergents in India (2. 7 kg pa) is alike(p) tosome countries like Indonesia, China and Thailand (around 2 kg pa), it is lower than inothers such as Malaysia, Philippines (3. 7 kg) and the USA (10 kg). senior high consumerawareness and penetration levels go forth enable the market to grow at an average 8-10% perannum with slightly higher growth in the rural areas. Higher p enetration stems frompopularity of low-cost detergents.Hence, besides increase in per capita consumption,there is tremendous scope for prodment up the value chain. tether Fabricare Brands Available In IndiaSurf ExcelSurf comes from the stables of Hindustan pry, the largest player in this market with anoffering at each price point. Surf was the offset printing detergent powder brand to be launched in thecountry. It created the detergent powder category and introduced the concept of bucketwash to housewives hitherto used to washing clothes with laundry soap bars. Surf has, since,become generic to detergent market.Consumers refer to all their powders as Surf, evencompetitive powders are called Surf e. g. Nirma Surf ? 10. Selling over 60,000 tonnes per year, Surf is the market leader in the concentrate andpremium powder price segments Surf has always been the first to recognize and respond totrends. Whether it was through Surf with Easy Wash- a low lather flesh, in 1994 or Surfwith Wash Boosters (1995) that forgetd go around clean even in hard water. The brand SurfExcel now has triad variants Surf Excel Quickwash, Surf Excel Blue and Surf Excel automatic rifle which address different laundry needs but each offers stain removal as the divulgebenefit.In 2003, recognising changing consumer purchase patterns, it once again redefined value forthe consumers by introducing the concept of monthly packs. Sensitive to the increasing concerns on environmental pollution and water scarcity problemsacross the country, it brought to the consumer Surf Excel Quickwash. This low lathervariant is the first eco-friendly detergent in the country, as it uses almost half the water otherdetergents require. Surf has innovated beyond the grassroots product into other aspects of laundry.Understandingthe need for easy-to-store packaging, tubs and jars were introduced. In order to helpconsumers dose correctly for the best possible clean, measuring scoops were built into thepacks. For convenience seekers, washing has been simplified with the ready to dose packs ofSurf Excel Automatic. conformable innovation addressing ever-evolving consumer needs has earned the brand aplace in the messages of consumers. Surf was rated in the top cristal Most Trusted brands in TheEconomic Times survey in 2003WheelWheel is Indias number one detergent brand.Launched in 1987, it cleans effectivelywith lesser effort, making a laborious chore like washing light and easy. Moreover,Wheel does not cut off hands or harm clothes like some other detergents, which containa high percentage of soda. Ever since its relaunch in 2001, with the new positioning of best clean with less effort,Wheel has been growing strongly. Research showed that consumers seek a solution to heavyduty laundry, like bed sheets and curtains. Developing on this insight, wheel sought to ? 11. liminate the trouble of tough malicious gossip or heavy-duty laundry. Mass market consumers havewelcomed the solution, mak ing it the number one. Nirma a home-grown product that revolutionized the detergent market in India, andsuccessfully challenged large multinational leaders in the process. The Nirma success story isa result of its founder, Dr. Karsanbhai Patels relentless focus on quality, cost and value. Thedistribution model, sustained line extensions and umbrella branding strategies have enhancedthe brands cost leadership.Today, the lodges two brands, Nirma and Nima, aredistributed through more thantwo million retail outlets across the country, generating gross gross gross revenue in excess of Rs. 26,000 million. In the fabric care category, Nirma has three productsfor the lower-end market. The Nirma Yellow Washing Powder is available in pack sizes of30 gms, 200 gms, calciferol gms and 1 kg, and is class-conscious as the largest wandering single detergentbrand in the world. Nirma is one of the large st dole outing single detergent brands in the world.Nirma products aresold through two milli on retailers and reach 400 million. This brand had been ranked as the Most astray distributed detergent powder brand in India as per AllIndia Census of Retail Outlets carried out in 435 urban towns by the AIMS (Asian InformationMarketing & Social) Research agency Brand Equity The Economic Times, March 11, 1997. As perthe ORG-MARG Rural Consumer Panel December 1998 survey, Nirma brand has been ranked ashighest in terms of penetration in washing powder category BT Rural Market Watch, double-deckeriness Today, June22, 1999. ? 12.World-over Ariel epitomizes stain removal and removes even the toughest stains in the firstwash. Introduced in India in 1991, Ariel has continuously led other detergents in productinnovation. For example, it pioneered the use of enzyme technology for superior and safestain-removing office, longer-lasting perfume, and the P&G proprietary cleaningtechnology, which cleans everyday soil and diddly from garments. everywhere the years, the brand hasenjoyed endo rsement from celebrities such as the fountain actress and now MP Shabana Azmiand lakhs of other homemakers in India. surge is the Worlds Oldest and Most Trusted Billion Dollar Detergent and is the marketleader in 23 Countries around the world. course provides outstanding tweed on whiteclothes and provides excellent everyday cleaning for colored clothes too. Launched in Indiain mid-2000, the brand has gained popularity among Indian housewives, thanks to itssuperior whitening, creative advertising starring Shekhar Suman, and its Value-for-Moneyproposition. Both Tide and Ariel are meg dollar brands in sales for P&G globally. Now Large Packs of Tide and Ariel Worlds Best Detergents at Rs. 3/- and Rs. 50/- only Mumbai, India March 02, 2004 Procter & stake today announced that it has decrease the prices of Ariel and Tide bags (large packs) by 20-50%, while maintaining the superior quality. The superior quality ? kg pack of Tide now cleans a familys one-month laundry in just Rs. 2 3/-, while a ? kg pack of Ariel cleans a familys one-month laundry in just Rs. 50/-. This epochal price reduction will now allow many more Indian consumers to start out the world-class experience of outstanding whiteness from Tide and superior stain-removal from Ariel in every wash.The new prices of Ariel and Tide are as follows ? 13. Old Price New Price Old Price New Price Pack Size P&Gs move to slash Ariel Ariel Tide Tide detergent prices is 200gm Rs. 30 Rs. 22 Rs. 20 Rs. 10 ostensibly to get more consumers to 500gm Rs. 70 Rs. 50 Rs. 43 Rs. 23 experience its brands 1kg Rs. 135 Rs. 99 Rs. 85 Rs. 46 but the industry sees it primarily as a 1. 5kg Rs. 180 Rs. 145 N. A* N. A move to wrest the proceeds from HLL 2kg N. A N. A Rs. 160 Rs. 88 in a sluggish market. The prices of sachets (20gm) of Ariel and Tide remain unchanged. N. A = Not Available in that size. Six months ago, P&G reduced the prices of Ariel and Tide sachets by 50% in order toencourage a larger number of consumers to e xperience their superior quality. The bettervalue offer on sachets received such an overwhelming, positive response from consumersacross India that P&G was encouraged to offer the overwhelming value to Ariel and Tide bagusers as well, thereby make the worlds best detergents accessible to a larger number ofIndian consumers.P&G talked to over 3,000 consumers across the length and slitth of India and observedover 25,000 washing sessions in consumers homes. Consumers believed in the superiorquality of Ariel and Tide but indicated pricing as a constraint in using Ariel and Tide on aregular basis. The drop in prices by the P&G has forced HLL to also react in a similar way thus shrinkingthe overall lucre margins for the theme. While the immediate impact of any price slash isbound to result in more volumes and thereby shares for the companies concerned,improving margins in the business remains doubtful. 14. smart set OverviewHindustan Lever Limited (HLL) is Indias largest fast moving c onsumer goods conjunction, with leadership in Home & Personal Care Products and Foods & Beverages. HLLs brands, spread across 20 distinct consumer categories, touch the lives of two out of 1888 Sunlight soapthree Indians. They endow the company with a home of combined volumes of most 4 introduced inmillion tonnes and sales of Rs. 10,000 crores. India. The leading business magazine, Forbes Global, has rated Hindustan Lever as the bestconsumer household products company.Far easterly Economic Review has rated HLL asIndias most respected company. Asiamoney has rated HLL as one of Indias best managedcompanies. Leading national publications, like The Economic Times, Business World, and 1895Business Today have also rated HLL as one of Indias most respected companies and the Lifebuoy soapnumber one in Market Value Added and EVA. launchedHLL is Indias largest marketer of Soaps, Detergents and Home Care products. It has thecountrys largest Personal Products business, leading in Shampoos, Sk in Care Products,Colour Cosmetics and Deodorants.HLL is also the market leader in Tea, ProcessedCoffee, brand Wheat Flour, Tomato Products, and scrap cream, Soups, Jams and 1902Squashes. Pears soap introduced inHLL is also one of the countrys biggest exporters and has been recognized as a golden IndiaSuper Star Trading House by the Government of India it is a net foreign exchange earner. HLL is Indias largest exporter of brand fast moving consumer goods. The companysExports portfolio includes HLLs brands of Soaps and Detergents, Personal Products,Home Care Products, Tea and Coffee.HLL is also driving exports in chosen areas whereIndia has a competitive advantage Marine Products, Basmati Rice, Castor Oil and its 1903 Brooke BondDerivatives. It is Indias largest exporter of Marine products, and one of the largest global Red tick off teaplayers in castor. launched. Market leading brandsHLLs brands have become household names. The companys strategy is to concentrate itsresources on 35 national power brands, and 10 other brands which are strong in certain 1905regions. The top five brands together account for sales of over Rs. 3000 crores.Each of Lux flakesthese mega brands has a likely scale of Rs. 1000 crores in the foreseeable future. introducedSome of the big brands in Soaps and Detergents are Lifebuoy, Lux, Liril, Hamam,,Pears,Rexona & Dove, (all soaps), Surf Excel, Surf, Rin, & Wheel (all detergents). HLLalso markets the brawn and Domex range of Home Care Products. 1913In the Personal Products business, HLLs Hair Care franchises are Clinic, Sunsilk and Lux Vim scouringshampoos. In Oral Care, the portfolio comprises Close-up and Pepsodent toothpastes and powdertoothbrushes.In Skin Care, HLL markets Fair & pin-up Skin Cream and Lotion, the introduced. largest selling Skin Care Product in India a brand developed in India, it is now exported toover 30 countries. It has been extended as an Ayurvedic cream, an under-eye cream, soap ? 15. and talc, in line wit h the strategy to take brands across relevant categories. The other majorSkin Carefranchises are Ponds, Vaseline, Lakme and Pears. In Colour Cosmetics, HLLmarkets the Lakme and Elle-18 ranges.In Deodorants, the key brands are Rexona, Axe, 1930Denim and Ponds, while the Talc brands are Ponds, Liril, Fair & Lovely, Vaseline and Unilever isLifebuoy. Axe and Denim are HLLs franchises for Mens toiletries. formed on January 1HLL has recently launched Lever Ayush Ayurvedic Health & Personal Care Products. Health Care is among the new businesses HLL has chosen to enter. The product rangecomprises Cough Naashak Syrup, forefrontache Naashak Roll-on, Dandruff NaashakShampoo, Hair Rakshak Oil and organic structure Rakshak Soap.The purity of the Ayurvedic 1931ingredients in Lever Ayush is endorsed by the renowned Arya Vaidya Pharmacy (AVP) of HindustanCoimbatore. It is for the first time that rigorous examen procedures of the pharmaceutical Vanaspatiindustry have been applied to Ayurvedic pro ducts. That is why the brand seal is Truth of ManufacturingAyurveda Proof of Science. Company registered on November 27HLL has started franchised Lakme Beauty Salons, offering standardised aids, in linewith the strategy to add a service symmetry to relevant brands.The company has set up the Hindustan Lever Network, a direct selling channel, offering 1932the Lever Home range of Laundry and Home Care products and the Aviance Personal Vanaspati manufactureCare range. starts at SewriThe company has also begun an e-tailing service, called Sangam, which can home-deliveron order by phone or through the Net, a diverse range of almost 5000 mark andunbrand products. The service is now available in select areas of Mumbai and NaviMumbai, besides Thane. 1939HLL is one of the worlds largest mail boat Tea marketers.Its Tea brands Taj Mahal, Red tend ReachLabel, Taaza, are among the top brands in the country it also markets Lipton Ice Tea. Factory purchasedHLL and Pepsi have formed an allia nce to distribute a full range of tea and java and soft outrightbeverages through vending machines HLL already has a base of around 15000 suchmachines. The coffee business comprises Bru newsbreak Coffee and Deluxe Green LabelRoast & Ground Coffee. The Kissan and Knorr Foods range comprises Spreads & Jams, Biscuit Sticks, Soups, 1943 Personal ProductsSquashes, Tomato Ketchup, Sauces, Puree, and Cooking Aids.Popular Foods, like Wheat manufactureFlour and Iodized Edible Salt, under the Knorr Annapurna brand name, have met with begins in India atremarkable success. The range has been expanded with ready-to-eat 10-second chapatis. Garden ReachThe innovative offerings are changing consumer habits into using processed, hygienic, Factoryhealthy and convenient products. The Kwality-Walls Ice Cream range comprises exotic Sundaes, Viennetta Desserts,popular appetite segment products like Max, Cornetto and Feast, and Cornetto Ripple 1947Softies.Ponds Cold Cream launched. Max was extended in 2001 as clams confectioneries, because children are a key consumersegment in confectioneries too. This is among the new businesses HLL has chosen toenter. ? 16. HLL has acquired young Food Industries (India) Limited, entering the bread market. Modern Foods was the first Public Sector Under fetching to be disinvested. Besides 1959 Surf launched. upgrading the existing Modern products, HLL has launched new products, among thembiscuits. HLL is liberating its brands from their existing category mindset.Historically, brandsoriginated and stayed within a category format. HLL sees its Power Brands as world able tooccupy a unique position in the consumers mind and therefore beingness able to stretch intoother product formats and categories. All such initiatives have had a promising start, and 1964there are more to come. Etah dairy set up, Anik ghee launched savage feeds plant atThe Distribution network Ghaziabad Sunsilk shampooHLLs distribution network is recognised as one of its key s trengths that which helps launched. each out its products across the length and breadth of this vast country. The need for astrong distribution network is imperative, since HLLs corporate purpose is to meet theeveryday needs of peck everywhere. HLLs products, manufactured across the country, the operations involve over 2,000 1969 Rin bar launchedsuppliers and associates. HLLs distribution network, comprising about 7,000redistribution stockiest about one million retail outlets, directly covers the entire urbanpopulation, and about 250 million rural consumers.In addition to the ongoing commitment to the traditional grocery trade, HLL is building aspecial relationship with the small but fast emerging new-fangled trade. HLLs scale enables itto provide superior customer service including daily servicing, improving their rangeavailability whilst reducing inventories. HLL is using the fortune of interfacing more 1975 Close-updirectly with consumers in this retail environment through es pecially designed toothpastecommunication and promotions. This is building traffic into the stores while yielding high launched.. growth for the business.An IT-powered musical arrangement has been implemented to tot up stocks to redistribution stockistson a continuous replenishment basis. The objective is to catalyse HLLs growth by 1978ensuring that the right product is available at the right place in right quantities, in the most Fair & Lovely skin creamcost-effective manner. For this, stockists have been connected with the company through launched.. an Internet-based network, called RSNet, for online interaction on orders, dispatches,information sharing and monitoring. RS Net covers about 80% of the companys turnover. 930 Unilever is formed onHLLs foray into Network Marketing January 1 1988 Launch ofAs per the market surveys conducted it is expected that the consumer market in India is Lipton Taaza expenditure 13000 crores per year and in few years the network market will captur e 500 crores as tea. per market surveys, considering the potential Hindustan Lever has launched HindustanLever Network (HLN), a unique Network Marketing opportunity . ? 17. 1991The Network marketing concept Surf Ultra detergent launched. In the normal marketing system, the maker supplies the products through themiddle men such as brokers, wholesalers and retailers.These middle-men add theirestablishment costs and their own margin of profit or commission on the price. Thisincreases the price by approximately 45 per cent. The consumer therefore gets the productat atleast a 45 per cent markup from the manufacturers price. 1993 Tata Oil Mills CompanyIn network marketing, these middle men are eliminated. A person is invited to join and (TOMCO),become a member (also called Consultant) of the network marketing company. This merges with theperson in turn invites many more people to join under him to form a group.These group companymembers, in turn invite their acquaintance to join under th em. This group is made tosteadily grow and it can grow into thousands or tens of thousands, in the course of time,depending upon the enthusiasm with which the Consultant imitate the sponsorship of newConsultants. 1994 HLL introducesThese Consultants make purchases of the products of the marketing company for self use Walls. and also for sale to other consumers. For their loyalty in regularly purchasing the products,the marketing co. gives discounts, handsome bonuses, rewards and special incentives.Each consultant in the group gets his shares of benefits depending upon the purchasesmade by him and also by the number of the consultant under him (called downlines). This 1995is called network marketing. HLL enters brandedThe growth in the beginning will be slow, from 1 to 2 to 4. but later on it will be rapid, staples1000 to 2000 to 4000.. and so on. devoted below are the approx. benefits received, business with saltdepending upon your group strength and on the assumption that each co nsultant haspurchased goods worth Rs 1,000/- in the month. The benefits will be more for higherpurchases and bigger groups.Group Strength Benefits 1996 HLL introduces253Nos(1+12+60+180) Rs17,938/- branded atta Surf Excel launched1531Nos(1+18+216+1296) Rs64,558/-3061Nos(1+36+432+2592) Rs 1,28,818/- 2002 HLL enters Ayurvedic health & beauty centre. ? 18. Shakti-Hll Rural ProjectShakti is HLLs rural initiative, which targets smallvillages with population of less than 2000 people or less. It seeks to empower underprivileged rural women byproviding income-generating opportunities, health andhygiene education through the Shakti Vani programme,and creating access to relevant information through theiShakti community portal.Started in 2001, Shakti has already been extended to about50,000 villages in 12 recites Andhra Pradesh, Karnataka,Gujarat, Madhya Pradesh, Tamil Nadu, Chattisgarh, UttarPradesh, Orissa, Punjab, Rajasthan, Maharashtra and WestBengal. The respective state governments and several Project Shakti By using self-helpNGOs are actively involved in the initiative. Shakti already groups, HLL has pushed its productshas about 13,000 women entrepreneurs in its fold. A typical down into the country. Into villagesShakti entrepreneur earns a sustainable income of about where people cannot spend more thanRs. 00 -Rs. 1,000 per month, which is double their average Rs 20-25 on FMCGs in a monthhousehold income. Project Shakti will expand the distribution cover bottom-up, the rural project will be top-down. Thiswill be a huge competitive advantage for Lever. The costs of expanding into these villages will betoo high for most companies, which do not have a portfolio spanning teas to detergents,In recent past Hindustan lever took some major decisions to remodel its business. These decisionshad major impact on the how distribution of lever products is managed in the market.Hindustan lever took the decision to simplify the company it merged all the different business units into two large divisions home and personal care (HPC) and foods and beverages (F&B). This gaveeach division The advantage is that these divisions get us enormous scale, The companydecided to whittle its brands down from 110 to 35, over the next three years. This is known asHLLs Power Brand strategy. To identify these power brands, managers were asked to consider their growth potential, profitdelivery and the size of the opportunity.And to ensure that Lever would not lose sales, it wasdecided to migrate these brand users to the designated power brands. For one, the drastic slimmingdown of the brand portfolio which threw up huge problems in execution is now over. HLL is already combining its scale advantage to offer retailers a bigger basket of products and betterservice. Instead of different sales teams servicing the same retailer, the company has integrated bothHPC and Foods portfolios for modern trade chains like Margin Free. Once again, its large portfolio ? 19. ange helps Lever t o use the power of customer relationships to corner greater shelf space and adisproportionately higher share of the branded segment. Modern trade, it reckons, is already growing at 15-20 per cent and will continue that way for a longtime. By bulking up the businesses, it is possible for Lever to service these modern trade outlets on adaily business. As a result, these retailers do not have to maintain high inventory levels. HINDUSTAN LEVER LIMITED BOARD OF DIRECTORSMr. Harish Manwani Non Executive chairmanMr. M. K. Sharma infirmity ChairmanMr. Arun Adhikari Managing Director (Home & Personal Care)Mr.S. Ravindranathan Managing Director (Foods)Mr. D. Sundaram Finance & IT DirectorMr. A. Narayan DirectorMr. V. Narayan DirectorMr. D. S. Parekh DirectorMr. C. K. Prahlad Director ? 20. The CompetitorsThe Indian FMCG markets have witnessed some of the classic struggles involving HLL. Sofar Levers have been able to stand their ground but times are changing. HLLs response tothe latest chal lenges is being eagerly studied by the corporate India. In order to gain afoothold in Indian FMCG sector various domestic and MNC companies are using all kind ofschemes to woo customer from HLL.The major competitors of HLL areDetergents P&G, Nirma, Henkel SpicToothpaste Colgate-PalmoliveBeverages Rasna, Coca-Cola (Sun fill)Tea Tata teaCoffee NestleIce-creams AmulShampoo P&G, Garnier Procter & GambleP&G Home Products Limited is a 100% subsidiary of The Procter & Gamble Company,USA. P&G Home Products Limited is one of Indias fastest growing Fast Moving ConsumerGoods Companies that has in its portfolio P&Gs global brands such as Ariel and Tide in theFabric Care segment, and in the Hair Care segment Head & Shoulders worlds largestselling anti-dandruff shampoo Pantene worlds No. beauty shampoo and Rejoice AsiasNo. 1 shampoo. Fabric CareProcter & Gamble has two of its world-leading detergents Tide and Ariel, in India to caterto the main concerns of the Indian households. In India P&G has launched followingbrands Ariel Front-O-Mat Ariel 2 Fragrances Tide Detergent Tide BarHair CareIn India, P&Gs beauty care business comprises of Pantene, the worldslargest selling shampoo, Head & Shoulders, the worlds No. 1 Anti-dandruffshampoo and Rejoice Asias No. 1 Shampoo. Pantene Pro V Head & Shoulders Rejoice ? 1. Baby Care PampersIn India, P&G will continue to be a midget, in turnover terms, when compared to HindustanLever. The two P&G subsidiaries in India (P&G Hygiene and P&G Home Products) todaygenerate a combined turnover of about Rs 1,100 crore, just a tenth of Hindustan Leverssales. P&Gs distribution network is largely urban and has a reach of 0. 4 m outlets. In 1994, Godrej entered into a strategic alliance with P&G for inter alia toilet soap business,under which Godrej used to manufacture soaps, which were marketed by a joint venturecompany. thus far post marketing alliance with P&G, the company lost significant part ofits market share and subsequently the a rrangement was discontinued. Godrejs entiredistribution network was then taken over by P&G. THE Procter & Gamble -Gillette deal could result in the former getting a significant boostboth to its scale of operations and range of products in the Indian market. That Gillettesportfolio of shaving razors, gels, grooming products and toothbrushes has no overlap withthat of P&G in India (shampoos, detergents, feminine hygiene, cold medication) is apositive.The addition of Gillettes businesses could help P&G expand its portfolio andacquire a more protracted distribution network This may strengthen P&Gs hand in theongoing war for market share with Unilever arms in the Asian markets, particularly withHindustan Lever in India. NirmaNirma is one of the few names which is forthwith recognized as a true Indian brand, whichtook on mighty multinationals and rewrote the marketing rules to win the heart of princess,i. e. the consumer. It was way back in 60s and 70s, where the domestic detergent mark et had only premiumsegment, with very few players and was dominated by MNCs.It was 1969, when KarsanbhaiPatel started door-to-door selling of his detergent powder, priced at an astonishing Rs. 3 perkg, when the available cheapest brand in the market was Rs. 13 per kg. In a compact span,Nirma created an entirely new market segment in domestic marketplace, which is, eventuallythe largest consumer pocketand quickly emerged as dominating market player. Now, the year 2004 sees Nirmas annualsales touch 800,000 tones, making it one of the largest volume sales with a single brandname in the world.Looking at the FMCG synergies, Nirma stepped into toilet soapsrelatively late in 1990 butthis did not deter it to achieve a volume of 100,000 per annum. This makes Nirma thelargest detergent and the second largest toilet soap brand in India with market share of 38%and 20% respectively. SoapsIn 1992, sensing a strong need to expand the market through PenetrativePricing, Nirma entered this market wi th the launch of Nirma Bath Soap&Nirma Beauty Soap . In 1998 Nirma expanded its product line in the soap ? 22. ategory by introducing Nirma Lime Fresh & Nirma Rose. This brand had carved a nichein its segment by achieving leadership position just within two months of its launch. It isavailable in 100g and 150g pack sizes. Nirma entered the premium soap segment when itlaunched Nirma SandalDetergentsNirma launched Nirma Washing Powder in Indian market in year 1969, This productwas priced at almost one third to that of the competitor brands, resulting into instant trial bythe consumers. Presently Nirma has different variants in Indian market.Nirma washing powderNirma superNirma popularEdible SaltNirma has also entered the Food market in the recent past with launch of Nirma Shudh. ? 23. FINANCIAL ANALYSIS ratio outline ? 24. All figures in Rs cr Particulars Dec 2001 Dec 2002 Dec 2003 Dec 2004 bargains 12420. 71 10641. 15 11919. 04 11594. 65 Total assets 7089. 06 7761. 01 8104. 68 7820 . 34 Net worth 3170. 86 3713. 91 2189. 22 2148. 67 Borrowings 102. 55 86. 23 1715. 18 1604. 25 Capital Employed 3273. 41 3800 3904 3752 Debtors 1254. 38 1169. 49 1228. 55 793. 56 PAT 1576. 47 1757. 59 1687. 3 1208. 4 PBDIT 2211. 63 2461. 31 2462. 92 1875. 63 Depreciation 202. 63 192. 65 199. 99 195. 68 PBIT 2009 2269 2262. 9 1680Current liabilities & Provisions 3709. 17 3841. 92 4084. 71 3919. 71 Current assets 3505 3510 3610 3132 Current assets -Inventories 2201 2146 2120 1574 Long term Debt 102. 55 86. 23 1715. 18 1604. 25 spare-time activity 12. 31 12. 86 69. 12 136. 25 Total Purchases 6077. 97 5389. 04 5438 5413. 77 attainability Ratios Operating wampum Margin (%) 16. 17 21. 30 19 14. 5 Net Profit Margin Ratio (%) 12. 68 16. 51 14. 15 10. 42 ROTA (%) 28. 3 29. 23 27. 92 21. 5 ROCE 61. 37 59. 72 58 44. 77 Return on Equity (%) 49. 71 47. 3 77 56. 23 Liquidity Ratios Current ratio 0. 944 0. 91 0. 88 0. 79 Quick Ratio 0. 59 0. 55 0. 52 0. 40 Absolute Cash Ratio 0. 25 0. 254 0. 21 8 0. 20 Solvency Ratios Debt Equity Ratio . 032 0. 023 0. 78 0. 75 involvement Coverage Ratio 163. 2 176 32. 74 12. 33 Efficiency Ratios Debtor Days 38. 85 40. 11 37. 62 25 Creditor days 135. 31 149. 2 131. 62 145. 23 Total assets turnover ratio 1. 75 1. 37 1. 47 1. 48 ? 25. Interpretation Profitability RatiosHLL earns 14. paisa on every Re. 1 of Sale before Interest and Taxes It ultimately makes 10. 42paisa on every Re. 1 of Sale after Interest and Taxes. It is discernible that Hindustan Lever Ltd. has not been able to increase its Operating Profit marginconstantly over the years. We can see that the operating margin has decreased considerable in thelast year. This is mainly due to the fact that the interest cost of HLL has almost doubled from 69. 12crores to 136. 25 crores. Moreover the companys operating expenses have increased by almost 75% in the year 2004.The efficiency has certainly decreased over the last few years mainly owing tohigh operating expenses , increased intere st effect and high indirect taxes. The Net Profit Marginhas also decreased by 17. 8 % in 2004 as compared to 2001. This is mainly due to the decrease insales by Rs. 826 cr. HLL generates 21. 5% Return on Total Assets (ROTA) that it employs in its operations in theyear ended 2004. ROTA has decreased in the last year mainly due to the fact that its profit marginhas decreased. It could be ecause of high competition as a result of which profits have decreasedand the total assets of the company have increased. As we can see that the Return on Capital Employed (ROCE) for Hindustan lever Limited hasdecreased considerably during the last year mainly due to lower profit margins. The company isearning a return of 44. 77% on the funds busy by it. Though the ROCE has seen aconsiderable change, even now the company is getting good enough returns and can catch up with goodenough dividends to the shareholders as we saw the case in the year 2004 where the rate ofdividend was 250%.The Return on E quity Ratio (ROE) states how much profit a company earned in parityto total meat of shareholders equity on the balance sheet of the company. Here, we see that theROE of HLL has increased in comparison to the year 2001 but this cant be concluded as afavourable situation for the company as looking at the figures in detail we can notice that there hasbeen a near to 30% decrease in ROE in comparison to the year 2003 , also we do see that the PATof the company has fallen by about 23% and the shareholders equity has also decreased by 32% incomparison to the year 2004. But Even now an ROE of about 56. 3% is considered to be verygood. Liquidity RatiosIt can be seen from the above table that the Current Ratio for all the years is less than 1. Thissignifies that HLL has short term liabilities greater than the short term assets. It implies that thecompany would have problems in managing its short term liabilities and fluidness requirements. The company might have to resort to financing its short term liquidity requirements by long termsources of finance. We can observe that the current assets have decreased by 13 % and at the same time the currentliabilities have decreased by just 4 % in the last year.The reason is that since the company is ? 26. using long term sources of finance to fund its short term obligations therefore the interest burdenhas increased and as a result the cash balance has decreased . Other receivables have also decreasedby more than 66% leading to a fall in current assets. Solvency RatiosThe company was highly unleveraged in the years 2001 and 2002. It was risky as the company hadinvested a huge amount of its own funds as compared to debt. However in the last 2 years thecompany has changed its policy and is leveraging the advantage of debt along with equity.Thoughthe debt equity ratio of 0. 75 is not good enough as compared to industry norms of 21 but thecompany is moving towards a favourable debt equity mix. It has realized the importance of t radingon equity . The Company has increased its debt burden by 1470% in the last 4 yearsInterest Coverage Ratio(ICR) basically signifies the ability of a firm to service its interest burdenthrough the profits generated . In the initial years when the firm had not employed debt its interestburden was very low.As a result the Interest Coverage ratio is very high, gradually the companyhas employed more debt and as a result of which the interest burden has increased significantly. Moreover, due to high competition and operating inefficiency the earnings of the company havedeclined. As a result the ICR has reduced from 163. 2 to 12. 33 in the last 4 years. However an ICRof 12. 33 is still very impressive which reflects the companys ability to pay interests on loanseasily. This is a good indicator to the various financial institutions providing long term sources offinance to HLL. Efficiency RatiosHere, we see that the Debtors Days for the company is less than the Creditor Days of thecompa ny. From this we can interpret that the company has a favorable cash position as it is makingits payments long after receiving the dues from the debtors. Here, from the Asset Turnover Ratiowe can know how efficiently the firm is using its assets, the ratio for which is pretty low for thecompany. The Creditor Days as well as Debtor Days both show negative growth which reflectsnegatively on the companys financials. The Asset Turnover Ratio also shows negative growthwhich is also not a good sign for the company.Thus, looking into these figures we can analyze thatthe efficiency level of the company has gone down vis-a-vis the previous years and hence thecompany needs to look urgently into these matters so as to improve the efficiency of the company. O DU-PONT RATIO ANALYSISThe Du Pont ratio analysis is a combination of financial ratios in a series in order to assess theinvestment returns of the company. It combines the financial ratios of both the Income Statementas well as the Balance Sheet in order to assess either the Return on Equity or the Return onInvestment.One of the Plus points of this method is that it provides a clear understanding of howthe company generates its return. This analysis provides an insight into the importance of assetturnover as well as sales to overall return. This formula shows the relationship of profit margin andturnover how these two complement each other. ? 27. The Du Pont ratio divides the Return on equity into three part Net Profit Margin, total assetturnover, and the companys use of leverage referred to as Equity multiplier also. DU-PONT CHART FOR HLL FOR THE YEAR 2004 RETURN ON EQUITY =PAT/NETWORTH 56. 3% Equity NET realize TOTAL ASSET Multiplier MARGIN TURNOVER =TA/NW =PAT/NET saleS =SALES/TA =10. 42% =1. 48 =3. 64% RETURN ON ASSETS ROA=PAT/TA =15. 44%Growth Trends Over The Years Particulars Dec-01 Dec-02 Dec-03 Dec-04 ? 28. Sales 12420. 71 10641. 15 11919. 04 11594. 65Expenditure 10627 8690 9941 10076Change InSales (%) -14. 33 12 -2. 7Change InExpenditure(%) -18. 22 14. 39 1. 35Change inPBIT (%) 12. 94 -0. 26 -25. 75Change inPAT (%) 11. 48 -3. 99 -28. 38Change inBorrowings(%) -15. 91 1889 6. 46Change InInterest (%) 4. 46 437. 48 97. 12 ? 29. COMMON MARKETING MIX FOR alone MARKETS 1.Product consists of brand, quality, appearance, 2. Price Structure consists of prices, dealers and consumers discounts. 3. furtheranceal activities consist of advertising, media. 4. Placement (distribution) system consists of dealers, distributors, retailers and overall logistics. MARKETING MIX FOR boorish MARKET 1. Product 2. Price 3. Promotion 4. Placement system 5. Packaging-Reason for putting it separately is because symbols and packaging becomes very important when literacy levels are very low. 6. Retailer is the one who gives all information about brand cream and consumer feedback. 7.Education is very important for rural sector-eg. Project Shakti 8. Empowerment Example-Project Shakti and Self Help Groups. PRO DUCTSurf derives its name from Surfactant the basic ingredient of a detergent. After 44 years, Surf brand has been upgraded and made more modern and contemporary. Surf has changed the entire brand is now called Surf Excel. Continuousimprovements in the formulation of the product and introduction of new ingredients e. g. enzymes, along with new perfumes have ensured that the product meets the evolvingconsumer needs. The brand Surf Excel now has three variants Surf Excel Quickwash, ? 0. Surf Excel Blue and Surf Excel Automatic which address different laundry needs buteach offers stain removal as the key benefit. Surf Excel Blue Target segment Economic segment. Attributes-Removes stains without fading colours. Sizes avalaible 25gm, 200gm, 500gm, 750gm, 1. 5kg, 3kgSurf Excel Quickwash (also called as Surf Excel Easy wash)(Hitherto known as just Surf Excel) Target segment Superior quality for washing machine users. Sizes available- 20gm, 20gm, 500gm, 1kg, 1. 5kg Attributes-Stain remov alSurf Excel Automatic Target segment-Washing machine owners Top and front loading machines .Sizes available- 600gm, 1kg Attributes Low lather detergent, anti corrosive, stain removal, ensures longer life of fabric. PRICELatest price war between detergent majors, Hindustan Lever (HLL), Proctor and GambleIndia (P&G), Nirma and Henkel-Spic India (HSIL) has proved that price in the marketingmix is very critical for growth of HLL products. If Surf excel prices were reduced to match the price cuts of their competitor (P&G),simultaneously they had to ramp up spending on advertising and promotions to increaseconsumption and penetration in the market and deem values of premium brand ? 1. PROMOTIONSSurf communication has been pleasant, soothing and gentle, Surf Excel has had adistinctively bold tongue in cheek style of communication. Promotions for Surf Excelare more often than not tactical weapons. Gift is offered to the consumer to gain short patronage or to engineer enhanced consumption . Choice of various promotionalgifts is usually governed by what can be bought cheap rather than any brand-relatedfactors. Surf Excel has always been sensitive enough to recognise the change in the consumerchoice dynamics.In some of their promotions, they have pampered influencersconsidering that brand choice in family products is a collective exercise. Various promotions being used for Surf are Scholarship offer Rs five lakh scholarship. Extremely rare and well-informed use of the marketing budget. Beauty of this promotion is in its design. An innovative and clever way of underscoringthe core portend of Surf Excel stain removal Visual depiction in the ad is student-focussed there are no mothers or daughters to be seen in the ad.Most of the people inthe ad are in their teens. The protagonist himself is unless in his teens. This can be anindication towards changing consumer algorithm. This was backed by Win with Stains campaign one of the largest campaigns taken upby Surf exce l. This promotion is happening in Orissa markets which is aimed at offering consumers achance to win prizes as well as give students an opportunity to pursue further studies. Theaim of the whole campaign is to drive home the point that stains are good in life and oneis not to be scared to get themselves dirty.They are not only doing road shows,advertisements but branded horoscope columns in keeping with the theme of luck andfortune. They have roped in former South African cricketer Jonty Rhodes to participate in theWin with stains washathon to wash the largest stain in town with kids of the NGO -Magic Bus 1 bucket free with 3kg of Surf Excel has really managed to increase sales revenue of Surf excel. This is the most successful consumer promotion till date in Orissa market. Surf KidStains a roadshow that invites consumers to get first-hand experience of using Surf.Surf has taken communication beyond mass media advertising and involved consumersin the brands anticipate in the rea l world. It has touched consumers life through schoolcontact and in-store programmes. Road shows have helped to go to the consumers anddemonstrate superior performance vis-a-vis competition. ? 32. PLACEMENT SYSTEMIn Orissa, HLL has around 100 dealers and distributors. But HLL is into the exercise ofreducing number of channels in Orissa by increasing territory size of each dealer. HLL Distribution in Rural MarketsHLL has come up with new distribution channels to cater to rural markets.For long-term benefits, HLL has mounted an initiative, Project Streamline, to furtherincrease its rural reach with the help of rural sub-stockists. It has already appointed 6000such sub-stockists. As a result, the distribution network directly covers about 50,000villages, reaching about 250 million consumers. The pivot of Streamline is the RuralDistributor (RD), who has 15-20 rural sub-stockists attached to him. Each of these sub-stockists is located in a rural market. The sub-stockists then performs th e role of drivingdistribution in neighboring villages using unconventional means of sustain such astractor, bullock cart,etc.The Streamline system has extended direct HLL reach in these markets to about 37% ofIndias rural population from 25% in 1995 and the number of HLL brands and SKUsstocked by village retailers has gone up significantly. ? 33. PACKAGINGPackaging plays a key role in rural markets. Since customers are daily wage earners andthey dont have monthly incomes like the urban consumers have, so Surf excel ispackaged in smaller sizes of 20gm so that they can afford given their kind of incomestreams. EDUCATIONSince vast majority of rural India lacks even basic education levels and modern outlook,HLL is training their new sellers to basic education levels.This is example of ProjectShakti which is explained in detail later. EMPOWERMENTHLL runs the program of Self-Help Groups (SHG), which lick like direct-to-homedistributors. The mo del consists of groups of (15-20) villagers below the poverty line(Rs. 750 per month) taking micro-credit from banks, and using that to buy HLL products,which they will then directly sell to consumersPrices of products 20gm 25gm 200gm 500gm 600gm 750gm 1kg 1. 5kg 3 kgSurf Quickwash 2 NA 23 53 NA NA 103 153 NASurf Automatic NA NA NA NA 90 NA 145 NA NASurf Blue NA 2 16 40 NA 53 NA 103 220 ? 34.Range of productsIf we divide detergent industry into three tiers Premium at Rs. 80-140 per kg Mid-price at Rs. 30-50 per kg Popular at Rs. 15-25 per kgPopular segment accounts for 80% of the detergent industry. HLL leads in detergent powders withPremium Surf ExcelMid price SunlightPopular Rin, WheelDealers and distributorsRetail Distributor MarginsExample of various distributor discounts on sale of these variants. Sale of 200gm Surf Excel Dealer rebate of 8%Sale of 20 gm Surf Excel Dealer Discount of 12%Wholesale Distributor MarginsThey get a standard discount of 1. % on sale of any variantStrategies in Orissa market 1. Shakti Pr ogramWith a twin objective of creating income-generating capabilities for underprivilegedrural women and improving their rural living standard through health and hygieneawareness, the Project Shakti is implemented in Orissa. Housewives and old ladies are targeted for this project. They are trained and given basiceducation to sell products. All products which are priced below Rs 5 are sold through thisproject. The sellers which are all ladies are paid margins of 3% on their sale of products.Now out of a total of 15,454 Shakti Entrepreneurs across India, Orissa hasover 928 (6%)Shakti Entrepreneurs spread across 22 districts. They are operating through Self Help Groups (SHGs) which is makes women direct-to-home distributors of HLL. Partnerships with several NCOs and support from stategovernments have been key enablers for the programme. Currently women entrepenuersare earning an average income of Rs. 7007- per month, doubling their household income. For the SHG women, it provides a sta ble, sustainable source of income.For villagers, thischannel has become a source of genuine and correctly priced products. ? 35. SALES TREND IN BHUBANESHWARBig Bazaar ,BhubaneshwarSales figures of Surf excel and is competitors Surf Ariel TideJuly sales 1,21,000 26,246 71,672July sold quantity 1787 pieces 341 pieces 1996 pieces ? 36. MARKET SHARE OF SURF Bhubaneswar, 20% Orissa, 35% Surf Excel Surf Blue Orissa, 65% Bhubaneswar, 80%SALE OF SURF EXCEL ON BASIS OF DIFERENT SIZES 10% 25% 20gm 200gm 500gm others(1kg,1. 5kg) 15%50%SALE OF SURF BLUE ON BASIS OF DIFERENT SIZES 7% 13% 20% 500gm 750gm5% 1kg 3kg 55% others(25gm,200gm) ? 37.PERCENTAGE SHARE OF SURF IN PREMIUM DETERGENTSMARKET 25% Surf Excel Ariel 75%SALE OF SURF EXCEL ON BASIS OF SEASONSCustomers reduce their washing frequency in rains, so the sales are drastically affected. Sale of detergents is strongly affected by seasonal changes as shown in the map below. 12% 18% Summers Winters Rains 70% ? 38. COMPETITOR ANALYSIS. In this section we compare HLL with its competitors, viz. Proctor and Gamble (Ariel, Tide) and Nirma Ltd (Nirma washing powder). We now compare these products and the companies on the various counts. Market Share The per capita consumption of detergents in India is 2. kg per annum. The synthetic detergent market can be classified into three main categories Premium (Surf and Ariel) 15% of total market Mid price (Rin and Wheel) 40% of total market Popular (Nirma) 45% of total market. Product Comparison HLL (market share 40%, including all 3 segments) manufactures Surf Excel in three avatars, Surf Excel Blue, Surf Excel Automatic and Surf Excel Quick wash. The USP of Surf Excel is that it reduces soaking time and water usage by 50%. It also contains a lesser amount of bleach than Ariel or Tide. P&G (market share 12%, including all 3 segments) produces both Ariel and Tide.Ariel is produced in three types, Ariel Front-o-mat, Ariel Spring Clean and Ariel Fresh Clean. The USP here would be removal of tough stains while taking care of cloth quality and imparting a fresh fragrance to it. Tide detergent improves washing experience while imparting a lingering lemon fragrance to clothes. Nirma (market share 30% of popular segment) comes in three variants, Nirma washing powder, Super Nirma washing powder and Nirma popular washing powder. Its USP would be low prices and the value for money it gives to the customer. Pricing Comparison We now compare the prices for these brands.The price of each product and its variant is shown in the table b 20gm 200gm 500gm 600gm 750gm 1kg 1. 5kg 2kg 3 kg 4kg (30sachets)Surf Quick wash 2 23 53 NA NA 103 153 NA NA NASurf Automatic NA NA NA 90 NA 145 NA NA NA NASurf Blue NA 16 40 NA 53 NA 102 NA 220 NAAriel 2 22 50 NA NA 99 145 NA NA NATide 1 10 23 NA NA 46 NA 88 NA 186 ? 39. Place comparisonHLLs distribution system is one of its key strengths. The delivers its finished productsto various Carrying and promotion Agents, via whom the goods reac h differentwholesalers. From here the goods are delivered to either rural or urban retailers, viawhom they reach the consumers.HLLs scale enables it to provide superior customer service including daily servicing,improving their range availability whilst reducing inventories. An IT-powered system hasbeen implemented to interpret stocks to redistribution stockists on a continuousreplenishment basis. The objective is to catalyze HLLs growth by ensuring that the rightproduct is available at the right place in right quantities, in the most cost-effectivemanner. For this, stockists have been connected with the company through an Internet-based network, called RSNet, for online interaction.As far as distribution to rural areas is concerned, they use a process called ProjectStreamline, wherein there exist networks of rural sub-stockists, who operate in the ruralareas itself. 20-30 sub-stockists come under a rural distributor (RD). The sub-stockists arethen responsible for distributing the products in rural areas. Nirma Limited markets its products through its fully owned subsidiary Nirma ConsumerCare Limited (NCCL), which was incepted in 1985. NCCL then resells the productsthrough Nirma and Nima. Nirma pioneered the concept of flat distribution network.Nirma Consumer Care Limited operates with two parallel distribution networks. TheNIRMA brand is marketed through the first network, which consists of about 450exclusive distributors. It is one of the lowest cost FMCG distribution channels of thecountry. The principle channel for Nirmas Products is the lowest cost system in Indiawith in built flexibility and speedy distribution. All NIRMA and NIMA range of productshave a retail reach of over two million retail outlets and more than 40 million loyalconsumers spread all over the country.The Company has been successful in establishingan extremely good urban as well as rural presence through the two distribution channels. The distribution channels have played a significant role in making Nirma a householdname. The efficient network has made Nirma Washing Powder the brand with highestpenetration in its product category. The network is well equipped to meet the demands ofthe loyal consumers of the Company across the country. ? 40. Promotion comparisonHLL. Advertising. Surf excel, synonymous with the catch line, Surf Excel hai naa was the first nationaldetergent brand on television.It has indulged in numerous advertisement campaignswhich have gained a lot of popularity. Surf Excel and Lalitaji ad also was in news for a long time. Slice of life situations havegenerated high levels of interest in the communication. Using consumer chat in the formof testimonials has helped in building credibility in the brand. She was a hard-headed bargain-hunting housewife who demanded value for money andnot just cheap price. Consumers faith in Surf was restored, and not just because sheoffered a rational argument. The real reason Lalitaji was believed was because she wa strusted y the Indian housewife to get her a good bargain. We showed her bargainingwith the vegetable vendor about good tomatoes and bad tomatoes Sasti cheez orachchi cheez me farak hota hai, bhai saab. This advertisement reversed a declining brand share trend. The currents advertisement on television shows noted actor and human rights activistShabana Azmi (who did promote Ariel once upon a time), walking with two buckets ofwater and encouraging a multitude of people to do the same. It basically plays on SurfExcels strength to perform with lesser amounts of water.It thus underlines th