SWOT Analysis of HUL ( Hindustan Unilever Ltd ) in a Simplified Way

HUL, the Indian arm of the Anglo-Dutch consumer goods giant Unilever, has about 40 brands in its portfolio that include categories like soaps, detergents, shampoos, skincare, toothpaste, deodorants, cosmetics, tea, coffee, packaged foods, ice cream, and water purifiers.

Let us look into the Overview of Hindustan Unilever Limited ( HUL ) and then we can move on to the SWOT Analysis of HUL ( Hindustan Unilever Limited ).

Overview of Hindustan Unilever Limited ( HUL )

Hindustan Unilever Limited (HUL) is a consumer goods company headquartered in Mumbai, India. It is a subsidiary of Unilever, a British company. Its products include food, beverages, detergents, personal care products, water purifiers, and other fast-moving consumer goods.

HUL was founded in 1931 as Hindustan Vanaspati Manufacturing Co. and was renamed Hindustan Lever Limited after a merger of the separate groups in 1956. The company was renamed Hindustan Unilever Limited in June 2007.

In 2019, Hindustan Unilever’s portfolio comprised 35 product brands across 20 categories. The company employs 18,000 people and had a turnover of `34,619 crores in the financial year 2017-18.

In December 2018, HUL announced the acquisition of GlaxoSmithKline’s Indian consumer business for $3.8 billion, at a ratio of 1:4.39. However, the integration of GSK’s 3,800 employees remained uncertain as HUL stated that the deal did not include a retention clause. In April 2020, HUL completed its merger with GlaxoSmithKline Consumer Healthcare (GSKCH India) after completing all legal procedures.

Did You Know? 

Hindustan Unilever Limited ( HUL ) states that nine out of ten Indian households use their products.

SWOT Analysis Of HUL ( Hindustan Unilever Limited )

The SWOT Analysis of HUL ( Hindustan Unilever Limited ) includes its strengths, weaknesses, opportunities, and threats. And in this reading of the SWOT Analysis of HUL ( Hindustan Unilever Limited ), we will examine this beauty and wellness company in terms of its internal and external factors.

S Stands For Strengths ( Internal Factor )

• Leader in FMCG Market: Two out of three Indian consumers use HUL products, according to Nielsen Study. To establish itself as a market leader in the Indian market, HUL has adopted a targeted approach in the supply chain & other things.
• Most Preferred Brand: From soap to mineral water, HUL shapes the lives of 1.3 billion people every day. HUL’s presence in the consumer market with its 20 categories such as soap, tea, detergent, shampoo, etc., and its wide range of products has helped it occupy a large share of shelf space in grocery and department stores, which explains the acceptance/demand for its products in the market.
• Innovations: Hindustan Unilever Research Center (HURC), Mumbai, and Unilever Research India, Bangalore, both research facilities were merged at one location in Bangalore in 2006. The people at this facility are continuously working on developing innovations in products and manufacturing processes that will help HUL establish itself as a frontrunner in the consumer goods market.
• High Brand Awareness: HUL generated positive word of mouth over the years by enlisting celebrities to promote their brands. This allowed them to socially anchor their brands, which were intelligently tailored to different income brackets.
• Wide Range of Products: It offers product categories, namely, oral care, personal care, household surface care, textile care, and pet food, etc., and has a wide range of products in all product categories.
• Strong Promoter: With more than 80 years of experience in the consumer goods market and backed by Unilever, which owns 67% of HUL, the company is financially strong.
• Huge Market Share: Due to high market penetration, HUL has managed to maintain its high market share in various product categories.
• Comprehensive and automated supply chain: HUL products are now a household name thanks only to the four-tier distribution system.
  1. Direct coverage within a city of fewer than 50,000 people through a popular speciality retailer.
  2. Indirect coverage: targets were villages closer to broader commercial markets.
  3. Streamline Use of the rural wholesale market to access markets that are not accessible by road.
  4. the Shakti Project targets existing SHGs (self-help groups) for women in small villages. Based on their accessibility and business opportunities, the markets have been segmented.
• Social Media: HUL has a strong social media presence with millions of followers on the three most popular social networking platforms: Facebook, Twitter and Instagram. The company has a high level of customer engagement with a low response time on these channels.
• Most Reputed Brand: The brand has always been recognized as a leading FMCG company and enjoys an excellent reputation.
• Marketing: HUL products have good visibility thanks to strong advertising via TV ads, print ads, online ads, social media engagement and digital marketing

W Stands For Weaknesses ( Internal Factor )

• Declining Market Share: competitors focusing on a particular product eating up HUL’s share, such as Ghadi & Nirma detergents eating up HUL’s market share in wheel washes.
• Large selection of brands in various product categories: A large portfolio of brands often leads to incorrect positioning. Price placement in some segments ensures low price competition, such as the market share gained by Amul from Kwality.
• Limited Market Share: The market share of HUL is limited due to the presence of other strong FMCG brands.

Also, Read The SWOT Analysis of Nestle ( One of the Largest Competitors Of HUL ( Hindustan Unilever Limited ) ).

O Stands For Opportunities ( External Factor )

• Expanding the market: Greater penetration of rural markets through Project Shakti AMMA and the transition from unorganized to organized enterprises will lead to further expansion of the consumer market.
• Awareness of the use of consumer products: advertising, word of mouth and medical prescribing raise people’s awareness of the use of consumer products, leading to an increase in the rate of use of these products.
• Growing income level: due to a stable political situation, higher literacy rate and regulated inflation, people’s disposable income is increasing, leading to higher demand and changing lifestyles.
• Ayurvedic products: May start manufacturing or marketing Ayurvedic products under the brand name of HUL.
• Partnerships: Mergers and acquisitions can further strengthen the brand in a long run.

T Stands For Threats ( External Factor ) 

• Market competition: with the increasing number of local and national suppliers, it is becoming very difficult for businesses to differentiate themselves from others. There is also a risk of counterfeit products destroying the brand image in the market.
• Price of raw materials: rising prices of raw materials will lead to further increases in prices. The further price increase will lead to a decrease in sales, profit margins and brand switching.
• Buyer Power: In a highly diversified consumer goods market, where many brands are promising different benefits, it is very difficult for consumers to get loyal to a particular brand. This leads to brand switching where consumers have the power to choose a brand based on various factors such as availability, recommendations from reference groups, preferences and price.
• Government regulations: Changing government norms and regulations can also directly affect business policies and practices.

SWOT Analysis Of HUL ( Hindustan Unilever Limited ) Key Takeaways

The SWOT Analysis of HUL ( Hindustan Unilever Limited ) highlights where the brand currently stands and its threats in this era. Following the detailed SWOT Analysis of Hindustan Unilever Limited ( HUL ) Here are a Few Important Key Points.

1. Strong Promoter
2. Strong Market Share
3. Highly Preferred Brand
4. Supply Chain System

Suggestions:

Following the detailed SWOT Analysis of HUL ( Hindustan Unilever Limited ), we have a few suggestions from Business Mavericks:

1. HUL needs to focus more on advancing its supply chain system and manufacturing department.
2. HUL needs to focus on the quality and also quantity of the product
3. HUL needs to launch more ayurvedic products and more.

Hindustan Unilever Limited ( HUL ) STP & USP

• Segment: Products and services for daily needs
• Target Group: Every Indian household especially the middle class
  
• Positioning: Being the largest FMCG company, HUL’s little efforts make a huge difference in the lives of people

HUL ( Hindustan Unilever Limited ) USP

HUL ( Hindustan Unilever Limited ) is India’s largest fast-growing consumer goods company

HUL ( Hindustan Unilever Limited ) List of Products:

1. skincare: Lifebuoy, Lux, Dove, Fair & Lovely, Lakme, Ponds, Pears, Rexona, Vaseline

2. household: Rin, Domex, Surf Excel, Vim, Comfort Fabric

3. dental care: Close Up, Pepsodent

4. hair care: Clinic Plus, Sunsilk

5. deodorants: Axe

Food and beverages:
1. tea: Brook Bond, TajMahal, Lipton

2. coffee: Bru

3. Kissan: jam, ketchup, squash

4. Kwality Walls.

The above brands are the best-known products from HUL’s (Hindustan Unilever) product portfolio.

Hindustan Unilever Limited ( HUL ) Competitors

1. Amul is an Indian dairy cooperative based in Anand in the Indian state of Gujarat. It was established in 1946 and is a cooperative brand owned by a cooperative society, Gujarat Co-operative Milk Marketing Federation Ltd. (GCMMF), which is now jointly owned by 3.6 million (3.6 million) milk producers in Gujarat, and the apex body of 13 District Milk Unions spread across 13,000 villages in Gujarat. Amul has kick-started India’s White Revolution, which has made the country the world’s largest producer of milk and dairy products.Kaira Union introduced the brand “Amul” to market its range of products. The word ‘Amul’ is derived from the Sanskrit word ‘Amulya’ which means ‘priceless’ or precious (a name suggested by the then Principal of Agriculture College, Dr Maganbhai Patel) and was established in 1946 through the efforts of Tribhuvanda’s Kishibhai Patel. The establishment of Amul made an important contribution to the white revolution in India.
2. Marico Limited is an Indian multinational consumer goods company that provides consumer products and services in the health, beauty and wellness sectors. Headquartered in Mumbai, Maharashtra, India, Marico has operations in over 25 countries across Asia and Africa. With its portfolio of brands like Parachute, Saffola, Hair & Care, Parachute Advanced, Nihar Naturals, Mediker and many more, the company touches the lives of one in three Indians.                                                                    The company owns brands in the categories of hair care, skincare, edible oils, health food, men’s care and textile care. In the financial year 2019-20, the company generated a turnover of ₹7,315 crores. Marico has 8 factories in India located in Pondicherry, Perundurai, Kanjikode, Jalgaon, Paldhi, Dehradun, Baddi and Paonta Sahib.
3. The Procter & Gamble Company (P&G) is an American multinational consumer products company headquartered in Cincinnati, Ohio, founded in 1837 by William Procter and James Gamble. The company specializes in a wide range of personal health, personal care and hygiene products. These products are divided into several segments, including beauty, personal care, health care, textile and household care, and baby, feminine and family care. Before the sale of Pringles to Kellogg’s, the product portfolio also included food, snacks, and beverages. P&G is based in Ohio.In 2014, P&G reported sales of $83.1 billion. On August 1, 2014, P&G announced that it would streamline the company, eliminating and selling about 100 brands from its product portfolio to focus on the remaining 65 brands that generated 95% of the company’s profits. A.G. Lafley, the company’s chairman and CEO until Oct. 31, 2015, said the future P&G will be “a much simpler, much less complex company with leading brands that are easier to manage and operate.”
4. ITC Limited is an Indian company headquartered in Kolkata, West Bengal. ITC operates in various industries such as cigarettes, FMCG, hotels, packaging, paperboard and speciality paper, and agribusiness. The company has a total of 13 business units across 5 segments. ITC also exports its products to 90 countries. Its products are available in 6 million retail outlets.Established in 1910 as Imperial Tobacco Company of India Limited, the company was renamed India Tobacco Company Limited in 1970 and later as I.T.C. Limited in 1974. Today, the company has been renamed ITC Limited, though “ITC” is no longer an acronym. The company turned 100 in 2010 and had annual revenue of $10.74 billion and a market capitalization of $35 billion in 2019-20.                                                           It employs over 36,500 people in more than 60 locations across India and is part of the Forbes 2000 list. Within a relatively short period, ITC has built 25 parent brands, many of which are market leaders in their segments. This dynamic portfolio of brands today represents annual consumer spending of over H19,700 million. ITC’s world-class Indian brand’s anchors competitive and inclusive value chains that create, capture and sustain the greater value within the country.
5. L’Oréal S.A. is a French personal care products company headquartered in Clichy, Hauts-de-Seine, with a branch in Paris. It is the largest cosmetics company in the world and has focused its activities on hair colour, skincare, sun protection, makeup, perfume and hair care.