A Project Report on Retailers Satisfaction and Expectation Towards HLL Distributor

Retailers Satisfaction and Expectation towards HLL Distributor

EXECUTIVE SUMMARY Hindustan lever limited is India’s largest fast moving consumer goods company and it also having largest distribution channel, with a leader in Home & personal care products and also foods & Beverages, having its reach to around 1 million retail outlets. These retailers form an important link between manufacturer, distributor and customer. The project assigned me was to access the satisfaction level of retailers and their expectation towards HLL distributor in Belgaum rural. This project taken up by me is a part of academic assignment to find out the attributes that affect the satisfaction level of retailers and suggestions to the distributor for improving quality of service. PROBLEM STATEMENT: “Retailers Satisfaction and Expectation towards HLL Distributor” in Belgaum rural. OBJECTIVES OF THE RESEARCH: o

To know the perceptions of retailer regarding distributor.

o

Find out the attributes that affects the satisfaction level of rural retailer.

o

Ascertain the opinion about merchandising activity.

o

To measure the behavior of sales person during visit.

METHODOLOGY 1.

Personal Interaction with TSI, RSP and interviews with retailer.

2.

A research survey (using questionnaire) would be conducted.

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Retailers Satisfaction and Expectation towards HLL Distributor

OUTCOME & BENEFITS OF THE STUDY: 1.

This study would bring into light on the expectation and perception of the retailers

with respect to the distributors functioning. 2.

It will help distributor to take the necessary steps to improve quality of service.

3.

It will help distributor to know the attributes that affect satisfaction level of retailers.

4.

Finally, it will help me understand (in practical) HLL distribution as whole and thus

enriching my knowledge.

SCOPE OF THE STUDY: My study is restricted to only Belgaum rural retailers. The whole study and analysis is done to measure the level of satisfaction and expectations of retailers towards their distributor and to find out the attributes and factors that affect the satisfaction level.

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Retailers Satisfaction and Expectation towards HLL Distributor

FMCG INDUSTRY IN INDIA

FMCG INDUSTRY IN INDIA

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Retailers Satisfaction and Expectation towards HLL Distributor As the name suggests, products of daily usage under the heads of personal care, fabric care, household care, packaged foods, beverages and tobacco characterize the sector. These are part of the monthly purchase basket. Such products generally have a non-cyclical consumer demand, low unit value, are mostly branded products, involve high marketing expenditure and have to be widely distributed. This sector has observed a 2% decline in the past 4 year period. FMCG pundits attribute this to various theories like FMCG commanding lower share of the wallet, what with several other newer expenditures in mobiles, computers, automobile etc. Other reasons to the decline may be down trading in brands or lower rural off takes. The Industry has a lot of potential since the product penetration and the per capita use is still low in India. As a matter of fact TV, which is the major source of information, reaches out to 80% of urban and 46% of the rural population. The key entry barriers into this section are the Brand, Supply Chain Management and the complexity involved in managing SKU’s (Stock Keeping Units). Also an Indian FMCG Company faces strong competition from the existing MNC-owned brands.

SUPPLY CHAIN The primary objective of supply chain management is to fulfill customer demands through the most efficient use of resources. A supply chain, logistics network, or supply network is a coordinated system of entities, activities, information and resources involved in moving a product or service from the supplier to the customer.

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Retailers Satisfaction and Expectation towards HLL Distributor

Typically a simple supply chain model will be as follows:-

Primary

Secondary

Consumer

There are several stages(Shipment) the money circulates. ( through which (Retailing) ) Purchase (OffThe P take) distribution intermediaries make the whole system of supply chain economically viable. Each “layer of Distributo intermediaries” implies fewer transaction complexities forR all the “layers”, augmenting Factory F C&FA C Retailer Consumer the C r reach. The experience, specialization and knowledge of local conditions, contacts and scale through such a network help achieve Operational Efficiency. SuperSubS Stockist

S Stockist

Without having to focus upon distribution, the brand managers can concentrate on their core activity of product development, sourcing and marketing. The companies get a cost advantage since most intermediaries are family owned businesses with low overhead and operational costs. The brand owners get a better return on capital employed as intermediaries hold the inventories.

THE CHALLENGE INVOLVED India has around 7.3 million retail outlets of which 3.0 million are in the 3768 towns and 4.3 are in the 627,000 villages. This fact is significant since the biggest challenge is to reach out to every nook of such a huge and diverse nation as India. As aptly said by Mr. Pusalkar, Supply Chain can be well learnt here. For a typical mid-size FMCG company, the numbers would be as… Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor •

C&FA (Carrying & Forwarding Agent) 30

•

Distributors & Super-stockiest 1,200

•

Sub-stockiest 1,000

•

Retailers reached

•

Retailers directly covered 500,000

•

Retailers via wholesalers 1,000,000

•

TOTAL 1,500,000

•

Consumers 10,000,000

The 7.3 million outlet strong retailing industry provides direct employment to more than 18 million people which roughly means one in every 25 families in India is engaged in the business of retailing. The rural markets are emerging to be the growth drivers of the future. The industry seeks to cater to a large rural population of the order of 700 million people. Of the 7.3 million retailers 58% are in rural areas. In most categories penetration is low and innovative packaging such as sachets and promotion is required. Achieving cost effectiveness to make the products reach rural outlets is essential.

THE ECONOMICS For an FMCG company, the direct customer is the distributor. The several intermediaries between the company and the actual consumers ( C&FA, Distributors, Super-stockiest, Sub-stockiest, Wholesalers, and Retailers ) need compensation for the costs incurred, namely the inventory holding costs, manpower costs, credit provided to the next intermediary, transportation costs, overheads, and entrepreneur’s risks and efforts. The

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Retailers Satisfaction and Expectation towards HLL Distributor remuneration is provided as a combination of gross margin (mark-up) on sales, commission on sales, and reimbursements. Typical Margins in such Supply Chain are:•

Distributor – 5%

•

Retailer – 7-15%

•

Wholesaler – 1-1.5%

•

Super-stockiest – 2%

•

Sub-stockiest – 5%

A distributor’s investment consists of inventory, Accounts receivable and accounts payable. He draws his income from gross margin or commission on sales. The expenses include discount expense, distribution expense and overheads. Typically an FMCG distributor expects a 25% ROI.

EMERGING TRENDS IN FMCG BUSINESS The industry has lately observed a rise of regional stalwarts such as Ghadi detergent, Baagh Bakri Tea etc. who are very strong in their respective geographical areas. Another emerging trend has been the rush to design products for the mass market in villages. C.K. Prahlad’s famous “Bottom of the Pyramid” theory is the guiding principle.

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Retailers Satisfaction and Expectation towards HLL Distributor The market is moving really fast as constant innovations are required in product, packaging and distribution. With the growth of information technology, the retailer has transformed from the old “gala owner” to a much better informed businessman. Direct Selling (e.g. Amway) as a parallel way of marketing is picking up. Increasing role of influencers (such as “Shakti Amma”, a famous concept in Andhra) has also emerged. There has been an influx of imports and ever increasing presence of multinational companies in this sector. The retailing business is also becoming more organized. Organized retailing comprises professionally managed single or chain of self-service stores. This has implications such as shorter supply-chain, move from inventory build-up method to collaborative planning, forecasting, and replenishment system, greater dependence on few ‘sophisticated’ buyers, customer management strategy etc. To sum up all A ‘world-class’ FMCG Sales & Distribution system. •

Ensures product availability

•

At the right place

•

In the right quantity

•

Ensures product replenishment

•

Ensures ‘profit’ for all intermediaries

•

At a minimal cost

GROWTH IN SALES OF FMCG COMPANIES: All top 10 categories record growth, the only exception being packaged tea. Spurred by high rural demand and retail sales, the fast-moving consumer goods (FMCG) sector posted 10.6 per cent growth year on year in February, the highest in the past five years, according to data provided by market research agency AC Nielsen.

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Retailers Satisfaction and Expectation towards HLL Distributor The rise does not come on a low base since the sales growth in February 2005 was 8.1 per cent year on year. And what is more, the growth has been broad-based with all the top 10 categories growing, the only exception being packaged tea. Besides, five of these categories have posted double-digit growth. And for the first time in four years, all the companies tracked by AC Nielsen have posted a growth in sales. The revival in the sector has been evident for some time now and the December quarter saw strong top line growth. For example, Dabur saw its revenue grow 26 per cent year on year, while Colgate’s sales grew 21 per cent. Besides, most companies now have far more pricing power than they did a year ago, which is reflected in the better operating margins last quarter. Colgate’s margin, for instance, was up 10 percentage points at 23 per cent, while that of Godrej consumer Products was up 270 basis points at 23.8 per cent. According to analysts, Hindustan Lever in February experienced the highest growth in five years while others such as Tata Tea and Dabur saw sales grow at a much faster pace compared with the December quarter. Tata Tea’s sales rise, for instance, is the highest since June 2005 while Britannia’s is the highest in 27 months. Analysts believe that the pick-up in the larger categories such as biscuits, washing powder, detergent cakes, shampoos and tea indicates a rise in demand for such categories in rural areas. This, they point out, is the main driving force behind the performance of companies such as Hindustan Lever, which recorded double-digit top line growth last quarter, the first time in six years. Very few segments in the FMCG space were now seeing a deceleration in growth and the momentum was expected to continue, analysts added. Even as the sector continues its strong run, the BSE FMCG index hit an all-time high of 2,103.5 on Friday with three of its components, ITC, Nestle and McDowell hitting all-time highs.

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Retailers Satisfaction and Expectation towards HLL Distributor ITC, incidentally, has the highest weight of 48 per cent in the index. The FMCG index has outperformed the Sensex for the better part of 2005 and has been a big out performer so far in 2006.

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Retailers Satisfaction and Expectation towards HLL Distributor

RETAILING AND RURAL MARKET

RETAILING AND RURAL MARKET Retailing is very diverse and sometimes the edges start to blur with other type of business. The word retail comes from the Old French retaille “to cut off”. So a wholesaler or manufacturer sells bulk lots while the retailer is willing to sell off smaller or individual pieces. Of course this definition only takes us so far because many wholesalers also sell retail and many retailers also sell wholesale in larger lots. Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor

Further, the common usage of retail is based more on whether the business deals directly with the public. . A local physical location is not even necessary for the definition of retail anymore now that etailing and eBay selling can be retail businesses into themselves. The best definition of retail might be any business whose product or service is made for, and targeted to, the consuming public.

Visual merchandising in Retailing. Selling goods using visual stimuli is an old age practice, but with increasing growth of retail industry, the art or arguably the science of visual merchandising has come to occupy a new found fancy. Marketers especially retailers, consider it as an inspirable part of their overall branding effort. But even as it continues to grow, like all other branding efforts, the understanding of its impact and effectiveness is still in its infancy.

What makes Rural Markets Attractive? Rural Consumer Insights:  Rural India buys….  Products more often (mostly weekly).  Buys small packs, low unit price more important than economy.

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Retailers Satisfaction and Expectation towards HLL Distributor  In rural India, brands rarely fight with each other; they just have to be present at the right place.  Many brands are building strong rural base without much advertising support.  Fewer brand choices in rural: number of FMCG brand in rural is half that of urban.  Buy value for money, not cheap products

Some Myths: Rural Market Is a Homogeneous Mass Reality: It’s a heterogeneous population. Various Tiers are present depending on the incomes like Big Landlords, Traders, small farmers; Marginal farmers: Labors, artisans. State wise variations in rural demographics are present viz. Literacy (Kerala 90%, Bihar 44%) and Population below poverty line (Orissa 48%, Punjab 6%) Disposable Income Is Low Reality: Number of middle class HHs (annual income Rs 45,000- 2, 15,000) for rural sector is 27.4 million as compared to the figure of 29.5 million for urban sector. Rural incomes CAGR was 10.95% compared to 10.74% in urban between 1970-71 and 1993-94. Individuals Decide About Purchases Reality: Decision making process is collective. Purchase process- influencer, decider, and buyer, one who pays can all be different. So marketers must address brand message at several levels. Rural youth brings brand knowledge to Households (HH). Why Different Strategies? Rural markets, as part of any economy, have untapped potential. There are several difficulties confronting the effort to fully explore rural markets. The concept of rural markets in India is still in evolving shape, and the sector poses a variety of challenges. Distribution costs and non availability of retail outlets are major problems faced by the marketers. The success of a brand in the Indian rural market is as unpredictable as rain. Many brands, which should have been successful, have failed miserably. This is because, most firms try to extend marketing plans that they use in urban areas to the rural markets. Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor The unique consumption patterns, tastes, and needs of the rural. Consumers should be analyzed at the product planning stage so that they match the needs of the rural people.

Therefore, marketers need to understand the social dynamics and attitude variations within each village though nationally it follows a consistent pattern. The main problems in rural marketing are:  Understanding the rural consumer  Poor infrastructure  Physical Distribution  Channel Management  Promotion and Marketing Communication Dynamics of rural markets differ from other market types, and similarly rural marketing strategies are also significantly different from the marketing strategies aimed at an urban or industrial consumer. Strategies to be followed: Marketing Strategy: Marketers need to understand the psyche of the rural consumers and then act accordingly. Rural marketing involves more intensive personal selling efforts compared to urban marketing. Firms should refrain from designing goods for the urban markets and subsequently pushing them in the rural Areas. To effectively tap the rural market a brand must associate it with the same things the rural folks. It can be done by utilizing the various rural folk media to reach them in their own language and in large numbers so that the brand can be associated with the myriad rituals, celebrations, festivals, “melas” and other activities where they assemble. Distribution Strategy: One of the ways could be using company delivery vans which can serve two purposes- it can take the products to the customers in every nook and corner of the market and it also enables the firm to establish direct contact with them and thereby facilitate sales promotion. Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor However, only the bigwigs can adopt this channel. The companies with relatively fewer resources can go in for syndicated distribution where a tie-up between non-competitive marketers can be established to facilitate distribution. Annual “melas” organized are quite popular and provide a very good platform for distribution because people visit them to make several purchases. According to the India n Market Research Bureau, around 8000 such melas are held in rural India every year. Rural markets have the practice of fixing specific days in a week as Market Days (often called “Haats’) when exchange of goods and services are carried out. This is another potential low cost distribution channel available to the marketers. Also, every region consisting of several villages is generally served by one satellite town (termed as “Mandis” or Agri-markets) where people prefer to go to buy their durable commodities. If marketing managers use these feeder towns they will easily be able to cover a large section of the rural population. Promotional Strategy: Firms must be very careful in choosing the vehicle to be used for communication. Only 16% of the rural population has access to a vernacular newspaper. So, the audiovisuals must be planned to convey a right message to the rural folk. The rich, traditional media forms like folk dances, puppet shows, etc with which the rural consumers are familiar and comfortable, can be used for high impact product campaigns.

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Retailers Satisfaction and Expectation towards HLL Distributor

INTRODUCTION TO THE COMPANY

INTRODUCTION TO THE COMPANY Hindustan Lever Limited (HLL) and its constituent companies have been in India since 1931. Over these decades, while HLL has benefited from the developments in the country, it has contributed equally to these developments. Unilever's mission is to add Vitality to life. We meet everyday needs for nutrition, hygiene, and personal care with brands that help people feel good, look good and get more out of life.

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Retailers Satisfaction and Expectation towards HLL Distributor Their deep roots in local cultures and markets around the world give us their strong relationship with consumers and are the foundation for their future growth. We will bring their wealth of knowledge and international expertise to the service of local consumers - a truly multi-local multinational. Their long-term success requires a total commitment to exceptional standards of performance and productivity, to working together effectively, and to a willingness to embrace new ideas and learn continuously. To succeed also requires, we believe, the highest standards of corporate behavior towards everyone we work with, the communities we touch, and the environment on which we have an impact. This is their road to sustainable, profitable growth, creating long-term value for their shareholders, their people, and their business partners In the summer of 1888, visitors to the Kolkata harbor noticed crates full of Sunlight soap bars, embossed with the words "Made in England by Lever Brothers". With it began an era of marketing branded Fast Moving Consumer Goods (FMCG).Soon after followed Lifebuoy in 1895 and other famous brands like Pears, Lux and Vim. Vanaspati was launched in 1918 and the famous Dalda brand came to the market in 1937. In 1931, Unilever set up its first Indian subsidiary, Hindustan Vanaspati Manufacturing Company, followed by Lever Brothers India Limited (1933) and United Traders Limited (1935). These three companies merged to form HLL in November 1956; HLL offered 10% of its equity to the Indian public, being the first among the foreign subsidiaries to do so. Unilever now holds 51.55% equity in the company. The rest of the shareholding is distributed among about 380,000 individual shareholders and financial institutions. The erstwhile Brooke Bond's presence in India dates back to 1900. By 1903, the company had launched Red Label tea in the country. In 1912, Brooke Bond & Co. India Limited was formed. Brooke Bond joined the Unilever fold in 1984 through an international acquisition.

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Retailers Satisfaction and Expectation towards HLL Distributor The erstwhile Lipton's links with India were forged in 1898. Unilever acquired Lipton in 1972 and in 1977 Lipton Tea (India) Limited was incorporated. Pond's (India) Limited had been present in India since 1947. It joined the Unilever fold through an international acquisition of Chesebrough Pond's USA in1986. Since the very early years, HLL has vigorously responded to the stimulus of economic growth. The growth process has been accompanied by judicious diversification, always in line with Indian opinions and aspirations. The liberalization of the Indian economy, started in 1991, clearly marked an inflexion in HLL's and the Group's growth curve. Removal of the regulatory framework allowed the company to explore every single product and opportunity segment, without any constraints on production capacity. Simultaneously, deregulation permitted alliances, acquisitions and mergers. In one of the most visible and talked about events of India's corporate history, the erstwhile Tata Oil Mills Company (TOMCO) merged with HLL, effective from April 1, 1993. In 1995, HLL and yet another Tata company, Lakme Limited, formed a 50:50 joint venture, Lakme Lever Limited, to market Lakme's market-leading cosmetics and other appropriate products of both the companies. Subsequently in 1998, Lakme Limited sold its brands to HLL and divested its 50% stake in the joint venture to the company. HLL formed a 50:50 joint venture with the US-based Kimberly Clark Corporation in 1994, Kimberly-Clark Lever Ltd, which markets Huggies Diapers and Kotex Sanitary Pads. HLL has also set up a subsidiary in Nepal, Nepal Lever Limited (NLL), and its factory represents the largest manufacturing investment in the Himalayan kingdom. The NLL factory manufactures HLL's products like Soaps, Detergents and Personal Products both for the domestic market and exports to India. The 1990s also witnessed a string of crucial mergers, acquisitions and alliances on the Foods and Beverages front. In 1992, the erstwhile Brooke Bond acquired Kothari General Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor Foods, with significant interests in Instant Coffee. In 1993, it acquired the Kissan business from the UB Group and the Dollops Ice cream business from Cadbury India. As a measure of backward integration, Tea Estates and Doom Dooma, two plantation companies of Unilever, were merged with Brooke Bond. Then in July 1993, Brooke Bond India and Lipton India merged to form Brooke Bond Lipton India Limited (BBLIL), enabling greater focus and ensuring synergy in the traditional Beverages business. 1994 witnessed BBLIL launching the Wall's range of Frozen Desserts. By the end of the year, the company entered into a strategic alliance with the Kwality Ice-cream Group families and in 1995 the Milk food 100% Ice-cream marketing and distribution rights too were acquired. Finally, BBLIL merged with HLL, with effect from January 1, 1996. The internal restructuring culminated in the merger of Pond's (India) Limited (PIL) with HLL in 1998. The two companies had significant overlaps in Personal Products, Specialty Chemicals and Exports businesses, besides a common distribution system since 1993 for Personal Products. The two also had a common management pool and a technology base. The amalgamation was done to ensure for the group, benefits from scale of economies both domestic and export market. In January 2000, in a historic step, the government decided to award 74 per cent equity in Modern Foods to HLL, thereby beginning the divestment of government equity in public sector undertakings (PSU) to private sector partners. HLL's entry into Bread is a strategic extension of the company's wheat business. In 2002, HLL acquired the government's remaining stake in Modern Foods. In 2003, HLL acquired the Cooked Shrimp and Pasteurized Crabmeat business of the Amalgam Group of Companies, a leader in value added Marine Products exports. Hindustan Lever Limited, 51.6% subsidiary of Unilever Plc, is the largest FMCG Company in the country, with a turnover of Rs118bn. The company’s business sprawls from personal and household care products to foods, beverages and specialty chemicals. Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor The company has a dominating market share in most categories that it operates in such as toilet soaps, detergents, skincare, hair care, color cosmetics, etc. It is also the leading player in food products such as packaged tea, coffee, ice cream and other culinary products. . Brand equities are built over a period of time by technological innovations, consistent high quality, aggressive advertisement and marketing. Availability near the consumer through a wide distribution network is another crucial success factor, as products are of small value, frequently purchased, daily use items. HLL is strong on both these fronts with leading brands, which are market leaders in their respective categories, and a 1mn strong direct retail reach. HLL is the market leader in the detergent and toilet soap industry with market share of 60% and 40% respectively. Nirma is a close competitor in detergents and has been slowly gaining ground in toilet soaps too. The other significant competitor in detergents is P&G. In oral care segment, HLL has emerged as a strong No 2 player with 36% market share. In the hair care segment, HLL dominates the shampoo market with a 64.5% share and is the No 2 player in hair oils. HLL has a 54% market share in skin creams. In the foods business, Tata Tea in packet tea, Nestle in coffee and culinary products, GCMMF (Amul) in ice creams, and Godrej Pillsbury in staple food are the main competitors. HLL grew at a fast pace in the mid 90’s driven by its aggressive acquisition spree. From Rs38bn turnover (contributed 70% by soaps, detergents and personal products), HLL’s turnover has now grown to Rs118bn, with soaps and personal products contributing 57% to turnover and beverages and food products contributing to 29% of turnover. Growth during the last few years has largely been driven by the personal products business.

However the pace of growth has slackened significantly in the last two years with several key segments registering a growth in 2001 soaps business (Rs21bn) de-grew by 1% and detergent sales (Rs20bn) grew by 7%. Other personal products (household care, oral acre, skin care, hair care, color cosmetics) registered a 14% yo-yo growth to Rs24.6bn. Expansion of the foods business, which has been identified as a major growth area, has not Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor been as fast as anticipated. Beverage sales move largely with commodity price trends, which have remained on a downtrend. Branded tea business degree by 10% in F12/01 to rs16bn, while the Rs3bn coffee business registered a 7% yo-yo growth. Ice-cream business has failed to takeoff registering a 3% growth. The staple food business, once considered a high potential growth area witnessed a decline of 10% yoy to Rs2.4bn.

Profitable growth has been the new mantra of the FMCG major’s Chairman, M S Banga, who took over the reins from Keki Dadiseth 2 years ago. In contrast to Dadiseth’s strategy of expansion through acquisition, Mr. Banga’s strategy revolves around rationalization. A focus on 30 power brands, which are major contributors to profitability, seeking new avenues of expanding distribution reach, improving profitability of foods businesses have been the thrust areas. Non-FMCG businesses are either being are hived off or are being strengthened by partnerships with players who have the technological expertise in those businesses. The strategy has paid results with profits registering a 24% yo-yo growth in 2001, despite a flat top line growth.

PRESENT STRUCTURE Hindustan Lever Limited (HLL) is India's largest Fast Moving Consumer Goods Company, touching the lives of two out of three Indians with over 20 distinct categories in Home & Personal Care Products and Foods & Beverages. They have the company with a scale of combined volumes of about 4 million tones and sales of Rs.10, 000 cores. HLL is also one of the country's largest exporters; it has been recognized as a Golden Superstar Trading House by the government of India. The mission that inspires HLL's 36,000 employees, including over 1,350 managers, is to "add vitality to life." HLL meets everyday needs for nutrition, hygiene, and personal care with brands that help people feel good, look good and get more out of life. It is a mission HLL shares with its parent company, Unilever, which holds 51.55% of the equity. The rest of the shareholding is distributed among 380,000 individual shareholders and financial institutions. Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor

HLL'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 in close to 80 factories. The operations involve over 2,000 suppliers and associates. HLL's distribution network, comprising about 7,000 redistribution stockiest, directly

covers

the

entire

urban

population,

and

HLL has traditionally been a company, which incorporates latest technology in all its operations. The Hindustan Lever Research Center (HLRC) was set up in 1958, and now has facilities in Mumbai and Bangalore. HLRC and the Global Technology Centers in India have over 200 highly qualified scientists and technologists, many with post-doctoral experience acquired in the US and Europe. HLL believes that an organization’s worth is also in the service it renders to the community. HLL is focusing on health & hygiene education, women empowerment, and water management. It is also involved in education and rehabilitation of special or underprivileged children, care for the destitute and HIV-positive, and rural development. HLL has also responded in case of national calamities / adversities and contributes through various welfare measures, most recent being the village built by HLL in earthquake affected Gujarat, and relief & rehabilitation after the Tsunami caused devastation in south India. Over the last three years the company has embarked on an ambitious program, Shakti. Through Shakti, HLL is creating micro-enterprise opportunities for rural women, thereby improving their livelihood and the standard of living in rural communities. Shakti also includes health and hygiene education through the Shakti Vani Program, and creating access to relevant information through the Shakti community portal. The program now

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Retailers Satisfaction and Expectation towards HLL Distributor covers about 50,000 villages in 12 states. HLL's vision is to take this program to 100,000 villages impacting the lives of over 100 million rural Indians. HLL is also running a rural health program – Lifebuoy Swasthya Chetana. The program endeavors to induce adoption of hygienic practices among rural Indians and aims to bring down the incidence of diarrhea. It has already touched 70 million people in approximately 15000 villages of 8 states. The vision is to make a billion Indians feel safe and secure. If Hindustan Lever straddles the Indian corporate world, it is because of being singleminded in identifying itself with Indian aspirations and needs in every walk of life.

MANAGEMENT STRUCTURE Hindustan Lever Limited is India's largest Fast Moving Consumer Goods (FMCG) Company. It is present in Home & Personal Care and Foods & Beverages categories. HLL and Group companies have about 36,000 employees, including 1350 managers. The fundamental principle determining the organization structure is to infuse speed and flexibility in decision-making and implementation, with empowered managers across the company's nationwide operations. For this, HLL is organized into two self-sufficient divisions - Home & Personal Care & Foods - supported by certain central functions and resources to leverage economies of scale wherever relevant. Board Divisions Central functions

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Retailers Satisfaction and Expectation towards HLL Distributor Businesses

Board At the apex is the Board, headed by the Chairman, and comprising 5 whole time Directors and 5 independent non-executive Directors. The day to day operations are supervised by the National Management comprising the Vice Chairman, Managing Director (HPC), Managing

Director

(Foods)

and

the

Finance

Director.

Divisions Each division is self-sufficient with dedicated resources and assets in sales, marketing, commercial, and manufacturing. The two divisions are further reorganized into categories. Typically, each category and each function - Sales, Commercial, Manufacturing - is headed by a Vice President. They with their respective Managing Director comprise that Division's Management Committee. For managing sales operations, HLL divides the country into four regions, with regional branches in Delhi, Kolkata, Chennai and Mumbai. Headed by a Regional Manager, they comprise Regional Sales Managers and Area Sales Managers, assisted by dedicated field forces, comprising Sales Officers and Territory Sales In charges. In Marketing, each category has a Marketing Manager who heads a team of Brand Managers dedicated to each or a group of brands. The commercial team of a Division is responsible for its supply chain management. There are teams dedicated to sourcing, planning and logistics. Each Division has a nationwide manufacturing base, with each factory peopled by teams of Production, Engineering, Quality Assurance, Commercial and Personnel Managers.

Central functions HLL's Central Functions are Finance, Human Resources, Technology, Research, Information Technology, Legal & Secretarial, and Corporate Affairs. Their services are Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor shared across the company. But, wherever necessary, managerial resources are dedicated exclusively to a business. For example, each Division now has dedicated HR managers. HLL believes that while it leverages the scale of a large corporate, it must also retain the soul of a small company. Its organization structure, which has and will continue to evolve with time, is aimed at achieving this knitting.

Businesses Home & Personal Care • Personal Wash • Fabric Wash • Home Care • Oral Care • Skin Care • Hair Care • Deodorants & Talc’s • Color Cosmetics

Foods • Tea • Coffee • Branded Staples • Culinary Products Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor • Ice Creams • Modern Foods ranges

New Ventures • Hindustan Lever Network • Ayush ayurvedic products & services • Saga • Purest water purifiers

Exports • HPC • Beverages • Marine Products • Rice • Castor

Products of HLL BRANDS OF HLL: HOME AND PERSONAL CARE: Lux Breeze Liril Dove Lifebuoy Pears Hamam Rexona LAUNDRY: Surf Excel Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor Rin Wheel SKIN CARE: Fair and Lovely Ponds HAIR AND CARE Sun silk Natural Clinic ORAL CARE: Pepsodent Close-Up DEODRANTS: Axe Rexona COLOUR COSMETIC: Lakme AYURVEDIC PERSONAL AND HEALTH CARE: Ayush TEA: Brooke bond Lipton

COFFEE Bru Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor

FOODS Kissan Knorr Annapurna ICE CREAM Kwality Wall’s

M/S NAGA TRADERS (RURAL DISTRIBUTOR)

BELGAUM Naga traders are the rural distributors for Hindustan Lever Limited and also they are supplying the products to the Shakti dealer, they are supplying retailer in rural area like. Bagewadi M.K Hubli Hukkeri Itagi pariswad Kanapur Nesargi Piranwadi Ganeshpur Sambra Yamaknamma etc......

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Retailers Satisfaction and Expectation towards HLL Distributor

Shakti dealer 1. S C.Hubli (munushikatti) 2. S A.Kaktikar (Belagundi) 3. S A.Tigodoli (Shindoli) They deal in products of HLL  Lux, Pears, Hamam, Rexona, Liril,Life bouy  Surf excel, Rin, Wheel  Sunsilk, Clinic plus  Pepsodent, Close-up  Fair and lovely, Pond’s  Brooke bond, Lipton Bru etc…..

HLL's INITIATIVE IN RURAL DEVELOPEMENT: Hindustan Lever Limited (HLL) and its constituent companies have been in India since 1931. Over these decades, while HLL has benefited from the developments in the country, it has contributed equally to these developments. HLL has consciously woven India's imperatives with the company's strategies and operations. The company’s main contributions include developing and using relevant technologies, stimulating industrialization, boosting exports, adding value to agriculture and generating productive employment and income opportunities. HLL has been proactively engaged in rural development since 1976 with the initiation of the Integrated Rural Development Program in the Etah district of Uttar Pradesh, in tandem with the company’s dairy operations. This Program now covers 500 villages in the district. Subsequently, the factories that HLL continued establishing in less-developed regions of the country have been engaged in similar program in adjacent villages.

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Retailers Satisfaction and Expectation towards HLL Distributor These factory-centered activities mainly focus on training farmers, animal husbandry, generating alternative income, health & hygiene and infrastructure development. The company has acquired a wealth of experience and learning from these activities.

KEY LEARNINGS ON RURAL DEVELOPEMENT: The principal issue in rural development is to create income-generating opportunities for the rural population. Such initiatives are successful and sustainable when linked with the company’s core business and is mutually beneficial to both the population for whom the program is intended and for the company. Based on these insights, HLL launched Project Shakti in the year 2001, in keeping with the purpose of integrating business interests with national interests

SHAKTI - Changing Lives in Rural India Shakti is HLL's rural initiative, which targets small villages with population of less than 2000 people or less. It seeks to empower underprivileged rural women by providing income-generating opportunities, health and hygiene education through the Shakti Vani program, and creating access to relevant information through the Shakti community portal. In general, rural women in India are underprivileged and need a sustainable source of income. NGOs, governmental bodies and other institutions have been working to improve Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor the status of rural women. Shakti is a pioneering effort in creating livelihoods for rural women, organized in Self-Help Groups (SHGs), and improving living standards in rural India. Shakti provides critically needed additional income to these women and their families, by equipping and training them to become an extended arm of the company's operation. Shakti started in 2001 and has already been extended to about 50,000 villages in 12 states Andhra Pradesh, Karnataka, Gujarat, Madhya Pradesh, Tamil Nadu, Chattisgarh, Uttar Pradesh, Orissa, Punjab, Rajasthan, Maharashtra and West Bengal. The respective state governments and several NGOs are actively involved in the initiative.

Why Shakti? EMPOWERING WOMEN IN RURAL INDIA The objective of Project Shakti is 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. A crucial lesson learnt was that rural up liftmen depended not on successful infusion of credit, but on its guided usage for better investment opportunities this is where HLL's Project Shakti is playing a role in creating such profitable micro enterprise opportunities for rural women.

CATALYSING PROSPERITY IN INDIAN VILLAGES Under the project, HLL offers a range of mass-market products to the SHGs, which are relevant to rural customers. HLL is investing significantly in resources that work with the women on the field and provide them with on-the-job raining and support. This is a key factor in ensuring the stabilization of the fledgling businesses. HLL imparts the necessary training to these groups on the basics of enterprise management, which the women need to manage their enterprises. For the SHG women, Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor this translates into a much-needed, sustainable income contributing towards better living and prosperity. Armed with micro-credit, women from SHGs become direct-to-home distributors in rural markets.

RISK-FREE MICRO ENTERPRISE THAT YIELDS HIGH RETURNS A typical Shakti entrepreneur conducts a steady business which gives her an income in excess of Rs.1, 000 per month on a sustainable basis. As most of these women live below the poverty line, and hail from extremely small villages (with populations of less than 2000), this earning is very significant, and almost twice the amount of their previous house hold income. For most of these families, Project Shakti is enabling families to live with dignity. In addition to money, there is a marked change in the woman's status within the household, with a much greater say in decision-making. This results in better health and hygiene, education of the children, especially the girl child, and an overall betterment in living standards. The most powerful aspect about this model is that it creates a win-win partnership between HLL and the consumers, some of whom will depend on the organization for their livelihood, and builds a self-sustaining cycle of growth for all. Shakti already has about 13,000 women entrepreneurs in its fold. A typical Shakti entrepreneur earns a sustainable income of about Rs.700 -Rs.1, 000 per month, which is double their average household income. Shakti is thus creating opportunities for rural women to live in improved conditions and with dignity, while improving the overall standard of living in their families. In addition, it involves health and hygiene program, which help to improve the standard of living of the rural community. Shakti's ambit already covers about 15 million rural populations. Plans are also being drawn up to bring in partners involved in agriculture, health, insurance and education to catalyze overall rural development.

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Retailers Satisfaction and Expectation towards HLL Distributor HLL's vision for Shakti is to scale it up across the country, covering 100,000 villages and touching the lives of 100 million rural consumers by 2005. Shakti, the Internet-based rural information service, has been launched in Andhra Pradesh, in association with the Andhra Pradesh Government's Rajiv Internet Village Program. The service is now available in Nalgonda, Vishakapatnam, West Godavari and East Godavari districts. Shakti has been developed to provide information and services to meet rural needs in medical health and hygiene, agriculture, animal husbandry, education, vocational training and employment and women's empowerment. The vision is to have 3,500 kiosks across the state by 2005.

HLL-DISTRIBUTION NETWORK

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Retailers Satisfaction and Expectation towards HLL Distributor

HLL DISTRIBUTION NETWORK The company salesman grouped all these orders and placed an indent with the Head Office. Goods were sent to these markets, with the company salesman as the consignee. The salesman then collected and distributed the products to the respective wholesalers, against cash payment, and the money was remitted to the company. The focus of the second phase, which spanned the decades of the 40s, was to provide desired products and quality service to the company's customers. In order to achieve this, one wholesaler in each market was appointed as a "Registered Wholesaler," a stock point for the company's products in that market. The company salesman still covered the market, canvassing for orders from the rest of the trade. He would then distribute stocks from the Registered Wholesaler through distribution units maintained by the company. The Registered Wholesaler system, therefore, increased the distribution reach of the company to a larger number of customers. The highlight of the third phase was the concept of "Redistribution Stockiest" (RS) who replaced the RWs. The RS was required to provide the distribution units to the company salesman. The RS financed his stocks and provided warehousing facilities to store them.

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Retailers Satisfaction and Expectation towards HLL Distributor The RS also undertook demand stimulation activities on behalf of the company. The second characteristic of this period we realized that the RS would be able to provide customer service only if he was serviced well. This knowledge led to the establishment of the "Company Depots" system. This system helped in transshipment, bulk breaking, and as a stock point to minimize stock-outs at the RS level. In the recent, a significant change has been the replacement of the Company Depot by a system of third party Carrying and Forwarding Agents (C&FAs). The C&FAs act as buffer stock-points to ensure that stock-outs did not take place. The C&FA system has also resulted in cost savings in terms of direct transportation and reduced time lag in delivery. The most important benefit has been improved customer service to the RS. The role performed by the Redistribution Stockiest has also undergone changes over the years. Financing stocks, providing manpower, providing service to retailers, implementing promotional activities, extending indirect coverage, reporting sales and stock data, screening for transit damages are some of the functions performed by the RS today. HLL has grown manifold over the years. In the process, the number of factories and the number of SKUs too have increased. In order to rationalize the logistics and planning task, an innovative step has been the formation of the Mother Depot and Just in Time System (MD-JIT). Certain C&FAs were selected across the country to act as mother depots. Each of them has a minimum number of JIT depots attached for stock requirements. All brands and packs required for the set of markets which the MD and JITs service in a given area are sent to the mother depot by all manufacturing units. The JITs draw their requirements from the MD on a weekly or bi-weekly basis. At present, HLL's products, manufactured across the country, are distributed through a network of about 7,000 redistribution stockiest covering about one million retail outlets. The

distribution

network

directly

covers

the

entire

urban

population.

In addition to the ongoing commitment to the traditional grocery trade, HLL is building a Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor special relationship with the small but fast emerging modern trade. Our scale enables us to provide superior customer service including daily servicing, improving their range availability whilst reducing inventories. We are using the opportunity of interfacing more directly with our consumers in this retail environment through specially designed communication and promotions. This is building traffic into the stores while yielding high growth for our business.

An IT-powered system has been implemented to supply stocks to redistribution stockiest on a continuous replenishment basis. The objective is to catalyze HLL’s growth by ensuring that the right product is available at the right place in right quantities, in the most cost-effective manner. For this, stockiest have been connected with the company through an Internet-based network, called RS Net, for online interaction on orders, dispatches, information sharing and monitoring. RS Net covers about 80% of the company's turnover. Today, the sales system gets to know every day what HLL stockiest have sold to almost a million outlets across the country. RS Net is part of Project Leap, HLL's end-to-end supply chain, which also includes a back-end system connecting suppliers, all company sites and stretching right up to stockiest. RS Net has come as a force multiplier for HLL Way, the company's action-plan to maximize the number of outlets reached and to achieve leadership in every outlet, by unshackling the field force to solely focus on secondary sales from the stockiest to retailers and market activation. HLL Way has also led to implementing best practices in customer management and common norms and processes across the company. Powered by the IT tools it has further improved customer service, while ensuring superior availability and impact visibility at retail points.

THE CHALLENGE OF THE RURAL MARKETS 70% of India's population resides in villages. Penetrating the rural markets is, therefore, one of the key challenges for any marketer. While rural markets present a great opportunity to companies, they also impose major challenges. At HLL, they have been at the forefront Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor of

experimenting

with

innovative

methods

to

reach

the

rural

consumer.

Indirect coverage Under the Indirect Coverage (IDC) method, company vans were replaced by vans belonging to Redistribution Stockiest, which serviced a select group of neighboring markets.

Operation Harvest The reach of conventional media and, therefore, awareness of different products in rural markets is weak. It was also not always feasible for the Redistribution Stockiest to cover all these markets due to high costs involved. Yet, these markets are important since growth opportunities are high. Operation Harvest endeavored to supplement the role of conventional media in rural India and, in the process, forge relationships and loyalty with rural consumers. Operation Harvest also

involved

conducting

of

product

awareness

programs

on

vans.

Cinema van operations these are typically funded by the Redistribution Stockiest. Cinema Van Operations have films and audio cassettes with song and dance sequences from popular films, also comprising advertisements of HLL products Single Distribution Channel For rural India, HLL has established a single distribution channel by consolidating categories. In a significant move, with long-term benefits, HLL has mounted an initiative, Project Streamline, to further increase its rural reach with the help of rural sub-stockiest. It has already appointed 6000 such sub-stockiest. As a result, the distribution network directly covers

about

50,000

villages,

reaching

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about

250

million

consumers.

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Retailers Satisfaction and Expectation towards HLL Distributor

Distribution will acquire a further edge with Project Shakti, HLL's partnership with Self Help Groups of rural women. The project, started in 2001, already covers over 5000 villages in 52 districts of Andhra Pradesh, Karnataka Madhya Pradesh and Gujarat, and is being progressively extended. The vision is to reach over 100,000 villages, There by touching about 100 million consumers. The SHGs have chosen to adopt distribution of HLL's products as a business venture, armed with training from HLL and support from government agencies concerned and NGOs. A typical Shakti entrepreneur conducts business of around Rs.15000 per month, which gives her an income in excess of Rs.1000 per month on a sustainable basis. As most of these women are from below the poverty line, and live in extremely small villages (less than 2000 population), this earning is very significant, and is almost double of their past household income For HLL, the project is bringing new villages under direct distribution coverage. Plans are being drawn up to cover more states, and provide products/services in agriculture, health, insurance and education. This will both catalyze holistic rural development and also help the SHGs generate even more income. This model creates a symbiotic partnership between HLL and its consumers, some of whom will also draw on the company for their livelihood, and helps build a self-sustaining virtuous cycle of growth

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Retailers Satisfaction and Expectation towards HLL Distributor

CHANNEL STRUCTURE

CARRY AND RE-DISTRIBUTOR STOCKIEST RE-DISTRIBUTOR STOCKIEST

Supermarkets- Self- service stores where there is a room for shoppers to browse and interact with the products.

Family grocer- Over the counter store mainly for monthly household shopping Kiosk- A tiny over the counter store, easily accessible for emergency purchases. It stocks solely low unit packs.

Wholesale- Sells stock to small retailer and end user.

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Retailers Satisfaction and Expectation towards HLL Distributor

DISTRIBUTION CHANNEL Old distribution channel of HLL: Manufacturer (Chennai)

C & F (Hubli) RD

Wholesalers

Retailers

End customer

Notation: Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor

1) C & F: Carriage Forward 2) RD: Rural Distributor

NEW DISTRIBUTION CHANNEL OF HLL: Manufacturer (Chennai) C & F (Hubli) RD Lab RS SS Retailers

SE

End customer

Notation: 3) C & F: Carriage Forward 4) RD: Rural Distributor 5) Lab RS: Lab Regional Stockiest Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor

6) SS: Star Seller 7) SE: Shakti Entrepreneur

RESEARCH METHODOLOGY

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Retailers Satisfaction and Expectation towards HLL Distributor

TITLE OF THE PROJECT

“Retailers Satisfaction and Expectation towards HLL Distributor”

MAIN OBJECTIVES: 1) To know the perception of retailers regarding distributor. 2) Find out the attributes that affects the satisfaction level of rural retailers. 3) Ascertain the opinion about merchandising activity. 4) To measure behavior of sales representative during Retailers visit.

SUB OBJECTIVES: 1)

Study the FMCG market in India and distribution system.

2) To know HLL initiatives in Indian rural market.

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Retailers Satisfaction and Expectation towards HLL Distributor

SAMPLE DESIGN POPULATION; Population for this research is 800 retailers of Belgaum Rural.

SAMPLE AREA:         

Belgaum Rural

Khanapur Nandgad Londa Hukkeri Yamakanamma Ganeshpur Peeranwadi Bagewadi Sambra

SAMPLING METHOD: The process of drawing sample units from the population is called sampling method. In order to have the unbiased results in the survey, the appropriate method of sampling i.e. “stratified sampling” adopted. It also includes convenience sampling.

DURATION OF THE PROJECT: Two Months FIELD WORK This market research involved a field work of 3 weeks where in I have administered pretested questionnaire to retailers. I have carried out the survey to 60 respondents by having the personal interaction with them.

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Retailers Satisfaction and Expectation towards HLL Distributor

TOOLS USED FOR ANALYSIS: 1. Hypothesis testing 2. Graphical Representation of Analysis: a. Pie charts b. Bar Diagrams

DATA COLLECTION APPROACH: Primary data has been used to carry out the research successfully. The secondary data has been collected from various journals and publications. For the purpose of gathering primary data a structure and non-disguised questionnaire was designed to collect data from the retailer. The questionnaire contains both open-ended and close-ended questions.

Method of Communication: In order to minimize the bias in data collection, the method of personal interview was adopted.

THE SOURCES OF THE DATA ARE AS FOLLOWS The study relies to a great extent on primary data and to some extent on secondary data: PRIMARY DATA: • Questionnaire •

Observation and interview technique

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Retailers Satisfaction and Expectation towards HLL Distributor

SECONDARY DATA: • Information is collected through internet •

From various text books

•

Journals and magazines

IMITATION OF THE STUDY; LIMITATIONS: The study is restricted in the scope owing to the following limitations: 1. The study is limited to a particular geographical area that is Belgaum rural only. 2. The information and data collected and analyzed is restricted to the researchers’ knowledge and ability. 3. The answers that I have got from the retailers cannot be considered as totally perfect because of various personal and other limitations. 4. Cost and time was also another limiting factor that affected the study. As retailer expectations and experiences include more of psychological aspects the survey made during a particular time period will give the information about the retailers during that particular time period. In order to be up-to-date in understanding the level of satisfaction periodic surveys are necessary.

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Retailers Satisfaction and Expectation towards HLL Distributor

ANALYSIS AND INTERPRETATION

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Retailers Satisfaction and Expectation towards HLL Distributor

Q1.Type of Store Table-No-1. Type of Store Grocery store Medical store Stationary store others TOTAL

No.of.Retailers 52 1 6 1 60

Percentage (%) 86 2 10 2 100

Graph-No-1

Stationary store 10%

Others 2%

Medical store 2%

Grocery store Medical store Stationary store Others

Z

Grocery store 86%

INFERENCES:  The above graph shows that out of 60 Retail outlets visited 86% are Grocery stores, 10% Stationary stores and 2% each Medical and other stores.  Here others consist of super market run by the co-operative society.  From the inference it can conclude that major portion of the type of retail store is Grocery stores.

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Retailers Satisfaction and Expectation towards HLL Distributor

Q2.Type of Outlet Table-No-2 Type of outlet Vijeta outlet Star outlet General outlet TOTAL

No.of.Retailers 10 5 45 60

Percentage (%) 17 8 75 100

Graph-No-2

Vijeta outlet 17% Star outlet 8%

Vijeta outlet Star outlet General outlet

General outlet 75%

INFERENCES:  Among 60 outlets 75% are General outlets.  10 vijeta outlets were visited, who come under the merchandising activity of HLL.  Remaining 8% consist of star outlets that enjoy gifts and offers on the bases of their sales point.

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Retailers Satisfaction and Expectation towards HLL Distributor

Q3. If Vijeta outlet: How would you rate the Merchandising activity of your HLL Distributor? Table-No-3 Merchandising activity Excellent Good Fair Poor Very Poor TOTAL

No.of.Retailers 3 5 2 0 0 10

Percentage (%) 30 50 20 0 0 100

Graph-No-3

5

4.5

4

3.5

3

2.5

2

1.5

1

0.5

0

Excelent

Series1

3

Good

Fair

Poor

5

2

0

Very poor 0

INFERENCES:  Out of 10 vijeta outlets 30% of retailers’ rated merchandising activity as excellent, 50% are rated it as good and remaining 20% rated fair.  All the vijeta retailers have shown a positive response towards merchandising activity.

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Retailers Satisfaction and Expectation towards HLL Distributor

Q4.How frequently you place the order? Table-No-4 Particulars Daily Once in a week Monthly Any other TOTAL

No.of.Retailers 0 32 2 26 60

Percentage (%) 0 53 3 44 100

Graph-No-4

35

30

25

20

15

10

5

0

Series1

Daily 0

Once in a week

Monthly

32

2

Any other 26

INFERENCES:  Above graph shows that more than 50% of retailers place there order weekly, 3% of retailers on monthly and 44% of retailers place order on every 15 days.  Here any other option represents every 15 days.

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Retailers Satisfaction and Expectation towards HLL Distributor

Q5.What is the contribution of HLL products to your total Sales? Table-No-5 Particulars Less than 5% Between 5-10% Between 10-20% More than 20% TOTAL

No.of.Retailers 7 25 25 3 60

Percentage (%) 12 41 42 5 100

Graph-No-5

More than 20% 5%

Less than 5% 12%

Less than 5% Between 5-10%

Between 10-20% 42%

Between 10-20% More than 20% Between 5-10% 41%

INFERENCES:  Among 60 retailers, 12% retailers said HLL products contribution to total sales is less than 5%. 

41%said between 5-10%, 42% said it’s between 10-20% and for 5% retailers it is more than 20%.

 Graph indicates that contribution of HLL products to more than 80% of retailers total Sales is between 5-20%.

Q6.Choice of stocking depends on….. Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor

Table-No-6 Particulars Demand Margin Shelf space Schemes and offers Advertisement TOTAL

No.of.Retailers 55 3 2 4 0 64

Percentage (%) 86 5 3 6 0 100

Graph-No-6 60

50

40

30

20

10

0

Series1

Demand 55

Margin

Shelf space

3

2

Schemes andoffers

Advertisement

4

0

INFERENCES:  Out of 60 retail outlets 86% retailers’ stocking decision depends upon consumer demand. 5%retailers said margin, for 3% retailers’ shelf space is important. 

6% said schemes and offers factor is crucial and advertisement doesn’t matter while making the stocking decision.

 Above graph indicates that consumer demand is the first choice in making stocking decision but it also concludes that retailers margin and schemes and offers for retailers and consumers also matters a lot.

Q7.During the visit was the sales representative….. Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor Table-No-7 Particulars Courteous Aggressive Rude Offhand TOTAL

No.of.Retailers 54 6 0 0 60

Percentage (%) 90 10 0 0 100

Graph-No-7

Aggressive 10%

Rude 0% Offhand 0%

Courteous Aggressive Rude Offhand

Courteous 90%

INFERENCES:  90% of retailers said during the visit sales person is courteous and 10% said they are aggressive. 

There is no any negative response found. All retailers are satisfied with the behavior of sales representative during visit.

Q8. How would you rate the sales representative explanation during visit? Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor Table-No-8 Particulars Excellent Good Satisfactory Poor TOTAL

No.of.Retailers 4 29 26 1 60

Percentage (%) 7 48 43 2 100

Graph-No-8

Poor 2%

Excellent 7%

Saticefactory 43%

Excellent Good Saticefactory Good 48%

Poor

INFERENCES:  7% of retailers’ rated sales representative explanation as excellent, 48 % rated good, for 43% retailers’ representative explanation during visit is satisfactory and 2% rated it as poor.  Above graph indicates that 98% of retailers are satisfied with the sales representative explanation during visit.

Q9. Were you given the opportunity to put your point of view during visit? Table-No-9 Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor Particulars Yes No TOTAL

No.of.Retailers 20 40 60

Percentage (%) 33 67 100

Graph-No-9

Yes 33%

Yes

No 67%

INFERENCES:  Above graph indicates that 67% of retailers are not satisfied with sales representative in respect to collecting feedback and giving opportunity to put there point of view during visit.  33% of retailers viewed they have given enough opportunity to put there point of view during visit.

Q10. How do you rate the delivery process of your HLL distributor? Table-No-10 Babasabpatilfreepptmba.com

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No

Retailers Satisfaction and Expectation towards HLL Distributor Particulars Prompt delivery Ok Not in time TOTAL

No.of.Retailers 27 32 1 60

Percentage (%) 45 53 2 100

Graph-No-10

Not in time 2%

Prompt Delevery 45% Prompt Delevery

Ok 53%

Ok Not in time

INFERENCES:  Among 60 retailers 45% of retailers rated delivery is on the time and prompt.  53% of retailers rated it as ok and 2% of retailers are not satisfied with the delivery process.

Q11. Are you satisfied with the schemes and discounts offered by the distributor? Table-No-11 Particulars Highly satisfied

No.of.Retailers 2

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Percentage (%) 4 Page 57

Retailers Satisfaction and Expectation towards HLL Distributor Satisfied Neutral Dissatisfied Highly dissatisfied TOTAL

29 18 8 3 60

48 30 13 5 100

Graph-No-11

30

25

20

15

10

5

0

Highly saticefied

Series1

2

Saticefied

Neutral

29

18

Dissatisfied

Highly Dissaticefied

8

3

INFERENCES:  Above bar graph depicts that out 60 retailers 48% retailers are satisfied with the schemes and discounts offered by the distributer.30% of the retailers remained neutral in rating there satisfaction.13 and 5% retailers are satisfied and highly dissatisfied towards there distributor.  It can be seen from the above that the satisfaction level is very low in respect to schemes and discounts offered by the distributor.

Q12.How do you rate your HLL distributor……. Order processing time Table-No-12 Ratings Very good Good

No.of.Retailers 17 40

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Percentage (%) 28 67 Page 58

Retailers Satisfaction and Expectation towards HLL Distributor Not good Bad Worst

2 1 0 60

TOTAL

3 2 0 100

Graph-No-12

Bad Worst 2% 0%

Not good 3%

Very good 28% Very good Good Not good Bad Worst

Good 67%

INFERENCES:  67% of retailers rated order processing time taken by the distributor is good (short) and 28% of the retailers are highly satisfied.  3% said order processing time taken by distributor is not good and 2% of the retailers are highly dissatisfied.  From the graph it can conclude that 5% of retailers are not satisfied with the order processing factor of distributor.

Billing Table-No-13 Ratings Very good Good Not good Bad

No.of.Retailers 14 45 1 0

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Percentage (%) 23 75 2 0 Page 59

Retailers Satisfaction and Expectation towards HLL Distributor Worst

0 60

TOTAL

0 100

Graph-No-13

Not good 2%

Worst 0% Bad 0%

Very good 23%

Very good Good Not good Bad Worst

Good 75%

INFERENCES:  Above graph indicates that 75% retailers rated billing process as good,23% retailers rated it as very good and only 2% of retailers are dissatisfied and rated not good.  It also indicates that most of the retailers are satisfied with the billing process of distributor.

Promotional activities Table-No-14 Ratings Very good Good Not good Bad Worst TOTAL

No.of.Retailers 4 38 17 1 0 60

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Percentage (%) 7 63 28 2 0 100 Page 60

Retailers Satisfaction and Expectation towards HLL Distributor

Graph-No-14

Not good 28%

Bad 2%

Worst 0%

Very good 7%

Very good Good Not good Bad Worst Good 63%

INFERENCES:  Above graph shows overall 70% of 60 retailers are satisfied and 30% of retailers dissatisfied with the promotional activities carried out by distributor.  It can be conclude from graph that many a retailers are dissatisfied with promotional activity of the distributor.

Safe Delivery Table-No-15 Ratings Very good Good Not good Bad Worst TOTAL

No.of.Retailers 14 42 4 0 0 60

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Percentage (%) 23 70 7 0 0 100 Page 61

Retailers Satisfaction and Expectation towards HLL Distributor Graph-No-15 Bad 0% Not good 7%

Worst 0% Very good 23%

Very good Good Not good Bad Worst

Good 70%

INFERENCES:  23 and 70% of retailers rated safe delivery factor is very good and good respectively.  Out of 60 retailers 7% are rated safe delivery is not good.  Overall there is a greater satisfaction towards safe delivery.

Sales person presentation Table-No-16 Ratings Very good Good Not good Bad Worst TOTAL

No.of.Retailers 9 49 2 0 0 60

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Percentage (%) 15 82 3 0 0 100

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Retailers Satisfaction and Expectation towards HLL Distributor

Graph-No-16 Bad 0% Not good 3%

Worst 0%

Very good 15%

Very good Good Not good Bad Worst

Good 82%

INFERENCES:  Above graph indicates 82% of the retailers are said sales person presentation is good.  15% of retailers rated it as very good.3% of retailers are not satisfied with sales person presentation during visit.

Availability of ordered stock Table-No-17 Ratings Very good Good Not good Bad Worst TOTAL

No.of.Retailers 2 17 38 3 0 60

Percentage (%) 3 28 64 5 0 100

Graph-No-17 Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor

Worst 0%

Bad 5%

Very good 3% Good 28% Very good Good Not good Bad Worst

Not good 64%

INFERENCES:  It clearly seen from above graph that 64% of retailers among total of 60 retailers are rated availability of ordered stock as not good.5% retailers rated it as bad and only 28 and 3% of retailers rated it good and very good respectively.  A major proportion of the retailers are not satisfied towards availability of ordered stock.

Hypotheses For the purpose of analyzing the gathered information few marketing hypotheses were the major issues in a successful conclusion of the research.

1. Issue: Contribution of HLL products to the total sales of retailers………. H0: Contribution of HLL products to the total sales of more than 50% retailers is below 10%. H1: Contribution of HLL products to the total sales of more than 50% retailers is more than 10% Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor Using Z test can prove this Computation of Z value Z=

P-P/ sigma P

P=0.50

q = (1-P) =0.50

N=60

(N-1) =59

where P= X/N = Respondents favoring Ho Total sample size P=32/60=0.53 Sigma P= P (1-P)/ (N-1)

=0.00423

Z= 0.53-0.5/0.00423 Z =6.97 K=1.64 (table value of Z) Conclusion; Since the calculated Z value (6.97) is more than the critical value (k=1.64) null hypothesis (Ho) is rejected. Result Contribution of HLL products to the total sales of more than 50% retailers is more than 10%

2. Issue: Availability of ordered stock…… H0: More than 40% of retailers are satisfied with the availability of ordered stock. H1: Less than 40% of retailers are satisfied with the availability of ordered stock Using Z test can prove this Computation of Z value Z=

P-P/ sigma P

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Retailers Satisfaction and Expectation towards HLL Distributor

P=0.40

(1-P) =0.60

N=60

(N-1) =59

where P= X/N = Respondents favoring Ho Total sample size P=19/60=0.32 Sigma P= P (1-P)/ (N-1) Z=

= 0.00406

0.32-0.40/0.00406

Z = - 4.43 K=1.64 (referring table value of Z)

Conclusion; Since critical value (K=1.64) is less than calculated Z value (- 4.43) null hypothesis is rejected. Result Less than 40% of retailers are satisfied with the availability of ordered stock.

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Retailers Satisfaction and Expectation towards HLL Distributor

FINDINGS

FINDINGS Research has been made on the topic “Retailers Satisfaction and Expectations towards HLL distributor” to identify the level of satisfaction of retailers at Belgaum Rural. Whole study only depends upon Belgaum rural retailers. Based on the analysis and the interpretation of the data given in the previous chapter findings and suggestions are recorded which are as follows  In Belgaum rural most of the retail stores are grocery stores. Only few stationary and medical stores sell HLL products to the ultimate consumer.

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Retailers Satisfaction and Expectation towards HLL Distributor  The number of Vijeta and Star outlets is very less. Most of the retailers are come under General outlet.  All the Vijeta outlets are highly satisfied with the merchandising activity. There is no single negative response to the merchandising activity.  It is found that most of the retailers place the order every week and once in 15 days .It shows that many of the retailers frequently place the order.  Among 60 retailers 50 retailers said contribution of HLL products to there total sales lies between the range 5-20%.Only few retailers’ sales exceed 20%.  There is no doubt that customer demand is first preference while making stocking decision and it is justified by study , 86% of retailers first choice is customer demand in making stocking decision. But still 14% of retailers stocking decision influenced by margin, shelf space, schemes and offers.

 It’s totally a positive feedback towards the sales representative behavior during the visit.90% of retailers rated during the visit sales representative is courteous and 10% of retailers rated they are aggressive.  Most of the retailers are satisfied with the sales representative explanation during visit.  Most of the retailers are not satisfied with the sales representative in collecting feedback and listening queries of retailers.  When I asked the retailers how you rate delivery process of distributor, all the retailers surveyed were respond they are satisfied with the timely supply of products from their Rural Distributor. Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor

 Only few retailers are satisfied with the schemes and discounts offered by the distributor.  When I asked how you rate HLL distributor in terms of order processing time taken, among 60 retailers 17 were replied very good and 40 as good.2 and 1 retailer replied not good and bad respectively.



The billing process followed by the Distributor also gains favor of the rural retailers, they in-fact quote it to be very efficient.



Among 60 retailers 38 retailers considered promotional activities carried by distributor is good. 18 retailers feel it is not good and they are dissatisfied with the distributor.

 Most of the retailers rated safe delivery factor as good. Retailers are satisfied towards safe delivery factor.  Among 60 retailers 97% retailers are happy with the sales person presentation.  Only few retailers are satisfied with the availability of ordered stock. Most of the retailers considered it as not good.  Most of the retailers are expecting schemes and offers for retailers and they are dissatisfied with their margin.

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Retailers Satisfaction and Expectation towards HLL Distributor

SUGGESTIONS Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor

Suggestions to HLL Distributor through this report Based on the findings of the study I would like to suggest few points. ⇒ Retailers viewed that display of the products has influenced their sale and many people in rural area recognize the product not by its name but by its external appearance. As all the Vijeta retailers have appreciated and are satisfied with the merchandising activity it is suggested that merchandising activity should be extended to all General retailers. ⇒ Modernization and standardization of rural retailers’ network must be carried out in order to exchange ideas on successful selling strategies and identifying areas of improvements “Sales through Services” and a Retailer Development Program must be carried out. Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor

⇒ It is advised to the sales representative, to give an opportunity to retailers to put their point of view during visit. ⇒ Still few of the rural retailers’ choice of stocking depend upon the factors like schemes, discounts, offers and margin and it attracts bulk orders to distributor. Distributor must satisfy retailers in respect to above factors. ⇒ Distributor should maintain stock of all HLL products. ⇒ Discount and company incentive should be passed on to the retailer by the distributors and distributor should periodically review the performance of their retailer.

CONCLUSION Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor

Conclusion To conclude, it is very much limited time to clearly understand the retailer satisfaction. Apart from this we need to focus on each retailers view carefully in regular time intervals (periodically) so to the best possible is presented here. Still there is a lot of scope for developing on this subject, as excellence is not limited always. Thus in brief, we can conclude that managing and measuring retailer satisfaction can bring about positive benefits to distributor, company and sales people as well as customers. Retailer satisfaction boosts more sales and loyal customer to distributor and in turn helps to produce more satisfied ultimate customers to the company.

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Retailers Satisfaction and Expectation towards HLL Distributor Thus the significance of retailers’ satisfaction stretches from introducing more and more promotional activities, good margin and better services from distributor.

BIBLIOGRAPHY  ⇒ ICFAI Journal ⇒ Marketing Management by Philip kotler ⇒ Marketing Research by Parshu Raman ⇒ www.hll.com ⇒ www.hllshakti.com

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Retailers Satisfaction and Expectation towards HLL Distributor

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Retailers Satisfaction and Expectation towards HLL Distributor

ANNEXURE

QUESTIONNAIRE Dear Sir/ Madam, Babasabpatilfreepptmba.com

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Retailers Satisfaction and Expectation towards HLL Distributor

Name of the outlet

:

Proprietor

:

Address

:

Telephone

:

1. Type of store: Grocery store

Medical store

Stationary store

If any specify……….

2. Type of outlet: Vijeta outlet

Star outlet

General outlet

3. If Vijeta outlet: How would you rate the merchandising activity of your HLL Distributor? Excellent

Good

Fair

Poor

Very poor

4. How frequently you place the order? Daily

Once in a week

Monthly

Any other………

5. What is the contribution of HLL products to your total sales? Less than 5%

Between 5-10%

Between 10-20%

More than 20%

6. Choice of stocking depends on….

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Retailers Satisfaction and Expectation towards HLL Distributor Demand

Margin

shelf space

Schemes and offers

Advertisement

7. During the visit was the Sales representative… Courteous

Aggressive

Rude

Off hand

8. How would you rate the Sales representative explanation during visit? Excellent

Good

Satisfactory

Poor

9. Were you given the opportunity to put your point of view during visit? Yes

No

10. How do you rate the delivery process of your HLL Distributor? Prompt delivery

Ok

Not in time

11. Are you satisfied with the schemes and discounts offered by the Distributor? Highly Satisfied

Satisfied

Neutral

Dissatisfied

Highly dissatisfied

12. How do you rate your HLL Distributor? FACTOR Order processing time Billing Promotional activities Safe Delivery Sales person presentation Availability of ordered

Very good

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Good

Not Good

Bad

Worst

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Retailers Satisfaction and Expectation towards HLL Distributor stock

13. Do you expect any additional service from Distributor? If yes state the additional services14. Any suggestion…………………………………………………………………… ……………………………………………………………………………………… ………………………………………………………………………………………

Thanks for your Assistance

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