Executive Summary
The company under study is the FMCG behemoth Hindustan Lever Limited (HLL). A partially owned subsidiary of Unilever, HLL was set up in India in 1931. Today it has gained the status of the biggest FMCG player in the country. With a wide product base and a mass market focus, HLL touches the lives of people all over India.
In the 70-odd years that HLL has been in India, it has adopted several different strategies to leverage its strengths and gain the success it currently enjoys. Backed by a very able management team and the support of its parent company, it has achieved enormous success that few other companies its size and age have managed in India.
However, the recent years have seen many challengers to HLL’s previously undisputed status. The market is saturated and sales have stagnated. HLL has responded to this challenge by studying its shortcomings, identifying failing strategies, and adopting new and innovative methods to re-gain market share. Some of the strategies it has adopted are moving to the low margin mass market, pruning it’s brand portfolio, and strengthening it’s distribution network. One of the key strategies is shift in target segment to the relatively unexplored rural markets. While most MNCs wrote off this segment as difficult to reach and unprofitable, HLL learned from success stories such as that of Nirma and Cavin Care and used it scale up on core competencies to enter and succeed in the market.
HLL’s growth has been both organic and inorganic. Acquisitions like that of TOMCO (Tata Oil Mills Company) and mergers like Lakme Lever limited were well thought out with clear targets in mind. Strategies such as these have been responsible for the extensive distribution network that HLL has today. I ...