SUBMITTED TO, MR.Swadheen Jain Sir (Faculty) Project Management School of Business mgmt.

SUBMITTED BY, Yogesh Kumar Sharma MBA III A Roll No. 49 School Of business mgmt.

HINDUSTAN UNILEVER LTD.

INTRODUCTION: Hindustan Unilever Limited (HUL) is India's largest fast moving consumer goods (F.M.C.G.) company, with leadership in Home & Personal Care Products and Foods & Beverages. HUL's brands, spread across 20 distinct consumer categories, touch the lives of two out of three Indians. They endow the company with a scale of combined volumes of about 4 million tones and sales of Rs.10, 000 crores. Hindustan Unilever was recently rated among the top four companies globally in the list of Global Top Companies for Leaders Each of the business divisions is further sub divided into Profit Centers. These Profit Centers drive the strategy for growth. The broad divisions of the businesses of HLL would be

Home and Personal Care

Detergents Personal Products

Foods and Beverages

Beverages Culinary Products Ice Creams Popular Foods ( Annapurna / Modern Foods ) Oils and Fats

Exports Chemicals/Agri Business/ Yeast Animal Feeding Stuffs Plantations

HUL meets every day needs for nutrition, hygiene, and personal care with brands that help people feel good, look good and get more out of life.

HUL's brands - like Lifebuoy, Lux, Surf Excel, Rin, Wheel, Fair & Lovely, Pond's, Sunsilk, Clinic, Pepsodent, Close-up, Lakme, Brooke Bond, Kissan, Knorr-Annapurna, Kwality Wall's are household names across the country and span many categories - soaps, detergents, personal products, tea, coffee, branded staples, ice cream and culinary products. They are manufactured over 40 factories across India. HUL has traditionally been a company, which incorporates latest technology in all its operations.

Winning with people

At HUL, people are our inherent strength. Attracting, developing and retaining talent is central to our HR strategy. It is vital that we have the right talent and organization to match our growth ambition and also to keep pace with the changing business environment. Towards this end, we have undertaken a detailed talent & organizational readiness assessment to review the skills and capabilities as also organizational structures needed to deliver our business goals.

The Parent Company

Unilever is a Fortune 500 transnational with a worldwide turnover of over $43650 million (year 1999). It is a global giant in Foods, Home and Personal Care products, marketing more than 1000 brands. Unilever has 300 operating companies in 88 countries, with sales in over 60 more.

Corporate Purpose
Like its parent, Unilever, HLL's Corporate Purpose is "to meet the everyday needs of people everywhere". The general guidelines for the conduct of business transactions have been defined under the Unilever Code of Business Principles.

Purpose & principles

Our corporate purpose states that to succeed requires "the highest standards of corporate behavior towards everyone we work with, the communities we touch, and the environment on which we have an impact." Always working with integrity Conducting our operations with integrity and with respect for the many people, organizations and environments our business touches has always been at the heart of our corporate responsibility. Positive impact We aim to make a positive impact in many ways: through our brands, our commercial operations and relationships, through voluntary contributions, and through the various other ways in which we engage with society. Continuous commitment We're also committed to continuously improving the way we manage our environmental impacts and are working towards our longer-term goal of developing a sustainable business. Setting out our aspirations Our corporate purpose sets out our aspirations in running our business. It's underpinned by our code of business Principles which describes the operational standards that everyone at Unilever follows, wherever they are in the world. The code also supports our approach to governance and corporate responsibility. Working with others We want to work with suppliers who have values similar to our own and work to the same standards we do. Our Business partner code, aligned to our own Code of business principles, comprises ten principles covering business integrity and responsibilities relating to employees, consumers and the environment.

Hindustan Unilever New Project:SHAKTI PROJECT IN INDIA (HUL) For Rural Development:-

INTRODUCTION:Hul starts Shakti is our initiative that combines social responsibility, sustainability, and business strategy. India has more than 6, 30,000 villages, most of these are 'hard to reach' and offer relatively lower business potential. Hence, reaching them through the conventional distribution system is a challenge. In 2000, we collaborated with Self-Help Groups (SHG) to extend our rural reach. We partnered with the SHGs by offering them opportunities for business. By promoting micro-enterprises, our initiative not only makes great business sense, but also has a deep social impact. The business objective is to extend our direct reach into untapped markets and to build brands through local influencers. The social objective is to provide sustainable livelihood opportunities for underprivileged rural women. On an average, a Shakti entrepreneur earns INR 700 - 1000 a month, and since most of them live below the poverty line, this earning is significant, often doubling the household income. Shakti started with 17 women in two states. Today, it provides livelihood enhancing opportunities to about 45,000 women in 15 Indian states and provides access to quality products across 100,000+ villages and over 3 million households every month. Project Shakti contributes to 10% of rural turnover nationally. In most Shakti markets, we are dominant and enjoy a market share which is qualitatively better as compared to non-Shakti markets. Shakti is not only a channel for increasing our reach, the Shakti entrepreneurs are also brand ambassadors for all HUL brands in rural India. Their relationship with consumers is forged by their home-to-home contacts, and goes a long way in building brand loyalty.

PROJECT SHAKTI A BUSINESS INITIATIVE WITH SOCIAL BENEFITS.

PROJECT SHAKTI
Project Shakti was launched in the year 2001 in the Nalgonda district situated in Andhra
Pradesh.

OBJECTIVE :
To create income-generating capabilities for underprivileged rural women, by providing a sustainable micro enterprise opportunity, and to improve rural living standards through health and hygiene awareness 4, 00,000 VILLAGES.

Planning Of Shakti Project:

Villages with a population of about 20003000 are selected Personnel from HUL approach SHGs Selection of the Shakti Amma HUL vouches for Shakti Ammas with banks for credit One Shakti entrepreneur is appointed for one village & Villages that are about 2 kilometers A part from her village (satellite villages). HUL set the product price for rural person through SHAKTI Project Rural consumers are price sensitive: Sachets and small packs of premium products. Price doesnt exceed Rs.5 per sachet. Lux at Rs.5, Lifebuoy at Rs.2, Surf Excel sachet at Rs.1.50, Pond's Talc at Rs.5, Pepsodent toothpaste at Rs. 5, Fair & Lovely Skin Cream at Rs.5, Pond's Cold Cream at Rs.5, Brooke Bond Taaza tea at Rs.5

Distribution
It is the combination of the 3 ways: Door to door selling (11% margin on sales) Sells from own home (11% margin on sales) Retailers (3% margin)

Averages sales:
Rs. 10,000 - Rs. 15,000/month, profit - Rs.1, 000 per month

Future plans
Project Shakti plans to extend to the states of West Bengal, Punjab and Rajasthan. Partnership with other non-competitor companies to sell their products through The Shakti network. Nippo, TVS Motor for mopeds, insurance companies for LIC policies

Why all these program

To take people aware To increase the consumption. To increase the income. To increase behavior. Awareness & living standard Lifestyle Self consciousness.

PRODUCT LIFE CYCLE OF HUL SHAKTI POJECT

Unilever took full advantage and became the market leader for SHAKTI PROJECT. They always concentrate on different Culture, lifestyles, tastes, preferences budgets & economic development of the country. This strategy helped Unilever to be the number one For Rural Initiatives. Unilever depends heavily on advertising this Project and continued product innovation to maintain And expand their market position.

MATURITY STAGE:
Competitor brands from both HULitself (e.g. Lifebuoy, Liril, Hamam, Breeze, and Dove) & other Manufacturers offered the competition & this slowed down sales. Price of these products is also very low in comparison to Shakti Project thats why customers move towards these products.

DECLINE STAGE:
HUL has use many strategy & done many campaigns for the sales promotion of the Project but the Sales are still decreasing. Currency fluctuation can often disrupt the best-laid business plans Of companies. Unilever products are in over 100 countries worldwide. As a result, it is exposed to adverse currency fluctuations. For instance, in 2004, a 5.9% decline in turnover was primarily attributed to a 4% appreciation of the average Euro exchange rate against other currencies. Cash equivalent in fiscal 2005 was reduced by 188 million as result ofadverse currency fluctuations. Any adverse currency fluctuations in the future would affect the group's bottom line growth. .

DEVELOPMENT STAGE:
An employed at in England developed a technology that allowed production of a very thin sheet of soap that then could be flaked. The company began selling what they first named "Sunlight Flakes" in England in 1899, though the name was changed to SHAKTI which is associated with luxury. Life flakes began to be imported to the U.S. in 1910 and manufactured at a new Lever Brothers plant in Cambridge & than in 1924 launched for poor persons.

GROWTH STAGE:
In the growth stage, their sales rapidly started rising. In the growth stage, they have expanded Their market. World market for soap is obviously market for Lux soap too. This figure shows the maximum market opportunity is in Asia, Europe, North America and Latin America.

Project formulation Of SHAKTI Project: (Poverty, gender, sustainability and

logical framework matrix). 1. During the project identification phase: Assessing the needs of the poor. Defining general project objectives. What ecosystem services will the project target? Do project objectives explicitly incorporate the links between poverty and the environment? How will the possible negative impacts of the project on the poor be managed?

2. During the project formulation phase:

How will project components target the identified links between constituents of well-being and Ecosystem services? Does a selection of the project components identify the existence of or the potential need for instrumental freedoms?

Are these instrumental freedoms relevant to the needs of the poor already identified in the project? Identification phase?

Project formulation

PRODUCT FEASIBILITY OF SHAKTI PROJECT: Shakti Amma (empowered mothers)- Project For Empowered Mothers Project Shakti is unleashing the potential of rural India and thus changing lives. It is ushering in prosperity and more importantly, self-respect. (HUL 2008) One of the best and sustainable ways Unilever can help to address global social and environmental concerns is through the very business in a socially aware and responsible manner. (Unilever 2008) Everybody wants brands. And there are a lot more poor people in the world than rich people. To be a global business and to have a global market share you have to participate in all segments. (Keki Dadiseth, Former Chairman HUL, 2004)

FEASIBILITY ANALYSIS OF PROJECT SHAKTI:Feasibility literally means whether some idea will work or not. It knows beforehand whether there exists a sizeable market for the proposed product/service, what would be the investment requirements and where to get the funding from, whether and wherefrom the necessary technical know-how to convert the idea into a tangible product may be available, and so on. In other words, feasibility study involves an Examination of the operations, financial, HR and marketing aspects of a business on (Before the venture comes into existence) basis. Thus, you may simultaneously read this lesson and the lessons on marketing, finance etc. to have a better idea of the issues involved. What we present hereunder is a brief outline of the issues impinging upon the various aspects of the feasibility of the proposed project. ESTIMATION OF CAPITAL COST THIS PROJECT:
One of the largest consumer goods companies in the world Global, regional and local brands 223 000 employees world-wide Brands on sale in 151 countries 65.3 million spent on community projects in 2003 (1.7% pre-tax profits).in HUL Shakti Project

The capital cost for a construction project includes the expenses related to the initial establishment of the facility:

Land acquisition, including assembly, holding and improvement Planning and feasibility studies Architectural and engineering design Construction, including materials, equipment and labor Field supervision of construction Construction financing Insurance and taxes during construction Owner's general office overhead Equipment and furnishings not included in construction. Inspection and testing.

Unit Cost Method of Estimation of HUL project

If the design technology for a facility has been specified, the project can be decomposed into elements at various levels of detail for the purpose of cost estimation. SHAKTI PROJECT unit cost for each element in the bill of quantities must be assessed in order to compute the total construction cost. This concept is applicable to both design estimates and bid estimates, although different elements may be selected in the decomposition.

Social Cost Benefit Analysis of HUL Shakti Project:With pure private goods, the costs carried by the individuals involved are the only economically meaningful costs. The choice to purchase for anyone other than the seller or the buyer. The costs involved in this economic activity are the costs of These Project Products that are ingredients to the lemonade, the opportunity cost of the labor to combine them into Shakti Project, as well as any transaction costs, such as walking to the stand. Social Cost Benefits Analysis means to analyze the social cost and total social benefits if we accept any project. We all know that for completing the big project, we need big investment. In social cost benefit analysis (SCBA), we see whether return or benefits on this project are more than its cost from point of view of society in which we are living. (HUL Says)

MARKET ANALYSIS OF SHAKTI PROJECT:Analysis HUL's Rural Model Works:

HLL's approach: can you get these groups as your brand ambassadors, who can buy the products and sell them in their villages? HLL would supply them the stocks, but the groups would decide who would do the enterprising. The group could nominate one or two people to sell the products. They could sell the products to other members in the group, consume within the family or sell to others in the village. Every time a women sells, she makes a margin (10 per cent; retailers make 8 per cent). If a group nominates a person to do the selling, the profits are ploughed back into the group's kitty. But if the individual borrows from the group to start the enterprise, the individual can retain the profits. Both models exist, but HLL is increasingly realizing that it's the individual model, and not the group model, that works in reality. Banks lend the groups at an interest rate of 12 per cent per annum or 1 per cent per month; the groups in turn, lend it internally to their members at 24 per cent per annum or 2 per cent per month. The potential: consider a village with a population of 1,000 people, and an average spend of Rs 4 per head per month on personal products; now, if everybody buys from this group, HLL's share of the rural consumer's spend would be Rs 4,000 (Rs 4 X 1000). If half the people buy, HLL's share of the consumer's spend would be Rs 2,000.

These provide rural women a platform to save money---they keep pooling money, save in a bank, and by the end of the year, they get a matching loan from the same bank. This way, the group's corpus doubles, and individual members can borrow internally from the group and start a business.

TECHNICAL ANALYSIS OF HUL PROJECT:

Technical analysis is a financial term used to denote a security analysis discipline for forecasting the direction of prices through the study of past market data, primarily price and volume. Behavioral economics and quantitative analysis incorporate technical analysis, which being an aspect of active management stands in contradiction to much of modern portfolio theory. The efficacy of both technical and fundamental analysis is disputed by efficient-market hypothesis which states that stock market prices are essentially unpredictable. SHAKTI PROJECT

Fundamental analysis involves analyzing the characteristics of this project in order to estimate its value. Technical analysis takes a completely different approach; it doesn't care one bit about the "value" of a company or a commodity for Rural Development. Technicians (sometimes called chartists are only interested in the price movements in the market.

Technical Analysis Tools Shakti Project:

Chart Patterns Candlestick Patterns Price Action Moving Averages Indicators Money Management Trading Systems and more...

ESTIMATION OPERATING COST HUL PROJECT:-

Operating Expenses - use of your assets & services to produce revenue. Some specific,
common examples are:

Cost of Goods Sold (non-cash expense) Rent (cash expense) Prepaid Insurance (non-cash expense) Wages & Salaries (cash expense)

Why Estimate Demand, Expenses & Overhead?

determine total dollar amount needed to start your business determine appropriate type of financing assess risk, feasibility, and personal investment have better information to help make decisions set appropriate price manage controllable expenses assure profitability manage cash flow

Operating Expenses and Overhead

Operating expenses are the expenses to produce your sales and to run the SHAKTI PROJECT. They usually each month with slight fluctuations.

There are two types:

Selling Expenses - may vary with demand; often thought of variable expenses. General & Administrative Expenses - likely constant; often referred to as fixed costs or overhead. Operating Ratio = [(Cost of goods sold + Operating expenses) / Net sales] 100

FINANCIAL APPRAISAL HUL PROJECT (SHAKTI)

Estimate the value or quantity of set a price on value To evaluate, especially in an Official capacity Estimate the quality, amount, size, and other features of judge Place a value on; judge the worth of something Consider in a comprehensive way. Evaluates from a local perspective taking a more detailed view of costs. Includes Depreciation Sunk costs Redundancy Repayment of grants Transfer payments Financial transactions External funding

Financial Appraisal Process:Identify RequirementIdentify Potential Options Economic Assessments Financial Assessments Risk Assessments Report Results

Qualitative Assessment

Financial Appraisal Criteria:- (HUL SHAKTI PROJECT)

1. NET PRESENT VALUE:- Net Present Value (NPV) or net present worth (NPW) of a time series of cash flows, both incoming and outgoing, is defined as the sum of the present values (PVs) of the individual cash flows of the same entity. In the case when all future cash flows are incoming and the only outflow of cash is the purchase price, the NPV is simply the PV of future cash flows minus the purchase price (which is its own PV). NPV is a central tool in discounted cash flow (DCF) analysis Project Value, and is a standard method for using the time value of money to appraise Shakti Project.

2. INTERNAL RATE OF RETURN:- The discount rate often used in capital budgeting that makes the net present value of all cash flows from a particular project equal to zero. Generally speaking, the higher a project's internal rate of return, the more desirable it is to undertake the project SHAKTI.

IRR = Annual average net earnings after taxes X 100 Average investment over the life of the project IRR = Annual average net earnings after taxes X 100 Original Investment

3. PAY BACK PERIOD: - Payback period in capital budgeting refers to the period of time required for the return on an investment to "repay" the sum of the original investment. HUl, a $1000 investment which returned $500 per year would have a two year payback period of this project. The time value of money is not taken into account. HUL Project intuitively measures how long something takes to "pay for itself."

SENSITIVITY ANALYSIS (Definition):

Sensitivity analysis (SA) is the study of how the variation (uncertainty) in the output of a statistical model can be attributed to different variations in the inputs of the model. Put another way, it is a technique for systematically changing variables in a model to determine the effects of such changes.

Sensitivity Analysis of HUL Project:-

Sensitivity Analysis
Those in project SHAKTI must be aware of the means of modeling risks to their project. Sensitivity analysis is one such method. It is implemented to analyze the various risks to the project by looking at all aspects of the project and their potential impact on the overall goal. This facilitates comparisons between the HUL various elements to quickly discern which risks are worth taking. Project management can use the sensitivity analysis to create priorities in dealing with elemental risks to this project.

Table 1. Uses of sensitivity analysis

1. 1.1 1.2 1.3 1.4 1.5 1.6 1.7 2. 2.1 2.2 2.3 3. 3.1 3.2 3.3 4. 4.1 4.2 4.3 4.4 4.5 4.6 Decision Making or Development of Recommendations for Decision Makers Testing the robustness of an optimal solution. Identifying critical values, thresholds or break-even values where the optimal strategy changes. Identifying sensitive or important variables. Investigating sub-optimal solutions. Developing flexible recommendations which depend on circumstances. Comparing the values of simple and complex decision strategies. Assessing the "riskiness" of a strategy or scenario. Communication Making recommendations more credible, understandable, compelling or persuasive. Allowing decision makers to select assumptions. Conveying lack of commitment to any single strategy. Increased Understanding or Quantification of the System Estimating relationships between input and output variables. Understanding relationships between input and output variables. Developing hypotheses for testing Model Development Testing the model for validity or accuracy. Searching for errors in the model. Simplifying the model. Calibrating the model. Coping with poor or missing data. Prioritizing acquisition of information.

SOCIAL RESPONSIBILITY OF SHAKTI PROJECT:Shakti is our initiative that combines social responsibility, sustainability, and business strategy. India has more than 6, 30,000 villages, most of these are 'hard to reach' and offer relatively lower business potential. Hence, reaching them through the conventional distribution system is a challenge. In 2000, we collaborated with Self-Help Groups (SHG) to extend our rural reach. We partnered with the SHGs by offering them opportunities for business. By promoting micro-enterprises, our initiative not only makes great business sense, but also has a deep social impact. The business objective is to extend our direct reach into untapped markets and to build brands through local influencers. The social objective is to provide sustainable livelihood opportunities for underprivileged rural women. On an average, a Shakti entrepreneur earns INR 700 - 1000 a month, and since most of them live below the poverty line, this earning is significant, often doubling the household income. Shakti started with 17 women in two states.

CORPORATE RESPONSIBILITY OF SHAKTI PROJECT:HULs Corporate Responsibility (CR) philosophy is embedded in its corporate purpose and Vitality mission. The company firmly believes that it has commitment to all its stakeholders - consumers, employees and the community in which it operates. It can fulfil this commitment only by sustainable growth. The Vitality mission of the company aims to improve quality of life through our products and through our interventions in the community. On this background, HUL's key CR initiatives are undertaken with a long-term view. Initiatives that are sustainable, that have long-term benefits and that have business linkage are accorded priority. Some initiatives are brand driven, some are driven by our people and some are driven by our processes.

Project Shakti is our initiative towards changing lives of women in rural India. Similarly, to commemorate our 75th year in India, we had decided to undertake some key initiatives. We have enhanced livelihoods of 75,000 women in a sustainable manner. We intend to partner with NGOs to augment their efforts by bringing in technical and managerial expertise in this area. For Enhancing Livelihood, HUL in partnership with Aide et Action India Private Limited has established the Livelihood Education and Skill Development project called Samruddhi (meaning prosperity) for the youth through Institute for Livelihood Education and Development (ILEAD) Centre in Silvassa.

ABOUT SHAKTI AMMA PROJECT:-

It Is a model of distribution has attracted a lot of attention both from the company as well as media. The model makes use of existing Self Help Groups working in villages and appoints them as sales persons called shakti amma to sell HUL products in villages. The idea is to be able to reach those villages which do not very good road connectivity and penetration of media is also poor. By appointing the lady as a distributor for the company is able to get a direct reach in villages where it had no presence earlier and the lady would be able to get additional source of revenue. A win-win situation if one were to describe it. The lady- Shakti Amma would be supplied the at her door-step and she would be selling it to the nearby cluster of 3-6 villages. The initiative has three components, one being the distribution component, second being the use of lady for communicating health and hygiene messages in the villages. The third component is IT, wherein a kiosk - ishakti is set up in the village, which could be used as information kiosk in the village.

OBJECTIVE THIS PROJECT: To Provide the Women Jobs. As a whole remains to create livelihood opportunities for underprivileged rural women. Recruites village women as sales persons called shakti amma and trains them to communicate and sell HUL products in villages. To be able to reach those villages which do not have good road connectivity. Shakti MMA also includes awareness programmers on health and hygiene, education, etc.Shakti now covers 15 states in India with over 45,000 women entrepreneurs in 135,000 villages.

CONCLUSION OF HUL PROJECT: (SHAKTI PROJECT)

Project Shakti is unleashing the potential of rural India and thus changing lives. It is ushering in prosperity and, more importantly, self-respect. One in eight people on the planet lives in an Indian village. Hindustan Unilever's Shakti Entrepreneurial Programme helps women in rural India set up small businesses as direct-to-consumer retailers. The scheme equips women with business skills and a way out of poverty as well as creating a crucial new distribution channel for Unilever products in the large and fast-growing global market of low-spending consumers. By 2012 the Shakti network aims to have reached 600 million consumers. From The above Survey and through the findings of this project we can conclude that Hindustan Unilever was the most preferred Brand in India. It has wide range of products varying from Home care Through Shakti Project Hindustan Unilever ltd. Is a leading FMCG company in India and from last three Consecutive years has shown accelerated growth in FMCG portfolio. Customers at Rural Development in India are also spending more in FMCG as their standard of living is growing. HUL has placed itself successfully in the position of market leader in FMCG products. It has increased its expenditure up to 26% in FY10. The net sale was Rs 4,475 crore in this period. According to Senior executive Ashish Malvann the company was strengthening its competiveness through advertising and they see improved turnover in the near future.

Project Shakti is unleashing the potential of rural India

Registered Office:
Hindustan Uniliver Ltd. Uniliver House, B.D. Sawant Marg, Chakala, Andheri (East) Mumbai-400099(Maharashtra) .