MUMBAI: Nearly 4,000 staff of Hindustan
, or HUL, including its chief executive officer Nitin Paranjpe, will this week dust the dirty shelves at your neighbourhood kirana shop and arrange soaps and shampoos in order to boost sales to regain its past glory as the fastest growing consumer goods company. ( Watch)
Project ‘perfect stores’ is the world’s biggest consumer connect initiative in Unilever family to raise falling market share of the Indian arm. If succeeds, this model will be replicated in other emerging markets.
This week, HUL would attempt to transform nearly 20,000 mom-n-pop stores and chemists selling its brands in 72 cities into one resembling an organised retail store such as Spencer’s and Big Bazaar, though small in size.
These “perfect stores’’ are standardised ones with set plans for fixtures and products and display. HUL’s experience shows a neat segmented arranging of similar products helps boost sales 30% of a store since 70% of purchase decisions are made on the spot.
“The objective of the programme is to help the customer better navigate the store,” said Hemant Bakshi, executive director—sales and customer development. “It will scale up the sales of the store in general, including those of our competitors,” said Mr Bakshi who will fly to Coimbatore on Monday to take part in the programme.
This is back to basics for executives living in ivory tower who missed the Indian economic growth story of the last decade when nimbler rivals such as homegrown Godrej Consumer Products grew.
HUL’s sales grew 110% over the last four years– from 2004-05 to 2008-09– compared with Godrej’s 148% during the same period, according to data available from BSE.
Its shares, once a darling of investors, have trailed rivals. It has raised 74.34% in the last five years– from April 30, 2005 to April 30, 2010– when rival Godrej Consumer Product’s rose 320.88%. The bellweather sensex rose 185.3% during the period, according to Bloomberg.
After the global head Paul Polman taking charge, the new mantra at Unilever is “consumer’’ and bye bye “shareholder interest’’. He is looking for increasing contributions from emerging markets such as India as sales in the Western markets falter.
“It’s a positive aggression, which, for a change, is not led by advertisements on television,” said Harish Bijoor, brand consultant and CEO of Harish Bijoor Consults Inc.