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Project Shakti
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Introduction
Hindustan Unilever Limited (HUL) to tap this
market conceived of Project Shakti.
This project was started in 2001 with the aim ofincreasing the companys rural distribution reach
as well as providing rural women with income-
generating opportunities. This is a case where the social goals are helping
achieve business goals.
4,00,000 VILLAGES
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States covered by Project shakti
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HOW IT WORKS?
Villages with a population of about 2000-3000 are selected.
Personnel from HUL approach SHGs.
Selection of the Shakti Amma.
HUL vouches for Shakti Ammas with banks from credit. One Shakti entrepreneur is appointed for one village &
villages that are about 2 kilometres apart from her village.
The Shakti dealer places initial orders worthRs.15000(principal customer of HUL
The Shakti dealer organizes a Shakti Day in thevillage(display of products & free gifts)
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The recruitment of a Shakti Entrepreneur or ShaktiAmma (SA) begins with the executives of HUL
identifying the uncovered village.
The representative of the company meets thepanchayat and the village head and identify the woman
who they believe will be suitable as a SA.
After training she is asked to put up Rs 20,000 asinvestment which is used to buy products for selling.The products are then sold door-to-door or through
petty shops at home.
On an average a Shakti Amma makes a 10% margin onthe products she sells.
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PRICING AND PACKAGING
Rural consumers are price sensitive
Sachets and small packs of premium products.
Price doesntexceed 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.
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SOME OF THE PRODUCTS SOLD THROUGH
PROJECT SHAKTI
AT
RS.2
AT
RS.5AT
RS.1.50
AT
RS.6
AT
RS.5AT
RS.5
AT
RS.5
AT
RS.5
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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
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HLLs approach to rural distribution
Accessibility
Streamline
Turnover per market
Indirect
Coverage
Direct
Coverage
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Direct coverage
Factory Depot Stockiest / Distributor Trade
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Indirect Coverage
Village 1
Village 2
Village 3
Village 4
Village 5
Stockist
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Streamline
Star seller
Star seller
Distributor
Star seller
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The role of micro-finance
The self-help group
Grameen Bank: mutual thrift societies of village women
A rapidly spreading movement: 6 million groups in
India
70% of rural households in APA micro-finance revolution
8 million families have received micro-credit
76% of micro-credit recipients have crossed thepoverty line
95% of micro-credit recipients are women
Effectiveness depends on opportunities for micro-
enterprise
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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.
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Issues
Low margins .
Difficulty in acquiring
finance transportation
Low disposable income
(dependence on monsoon)
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Profile of Indian rural Economy
Sector %
Agriculture 78.0
Manufacturing 7.1Service 5.8
Trade 4.4
Others 4.3
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Why all these program
To take people aware
To increase the consumption.
To increase the income.
To increase behavior in
Awareness & living standard Lifestyle
Self consciousness.
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WH
YSHAK
TI??? It was soon felt that HUL's sales and distribution
system which had protected it from competitors
would be soon replicated by its rivals and to
maintain its edge, the company had to increaseits reach beyond the urban markets
Carrying and forwarding agents(CFA)
more than 70% of India's population lived invillages and made a big market for the FMCG
industry
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BENEFITS Earnings about 7%, after 3% goes towards
principal and interest
Improves her per-capita income by about
50% to 100%
100,000 entrepreneurs by 2010
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With lack of TV or Radio medium
Promotion through demonstration of HUL
products at the Haat Bazaar.
Star sellers made up for this lack of audio-
visual brand advertising.
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Differential pricing for rural costumers
purchasing from SHG
Two different channels of same companycompeting on PRICE.
Undermining local retailers
Negligence of flooding of counterfeit productsinto market place
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PROGRAMMES UNDERTAKEN
SHAKTI VANI
SHAKTI ENTREPRENEUR
iSHAKTI COMMUNITY PORTAL
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Shakti Vani Social communication anchored on brands
health and hygiene womensempowerment
Village women are recruited as Vanis and trained to
communicate
Vani audience: key opinion leaders, schools, SHG meetings,other village gatherings
Specially designed communication material easy-to-carry kit: flip-charts, leave-behind posters, banners
content developed after in-depth understanding of localcontext
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Hand-wash demo in schools
h k i i i i
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Shakti Activities
Free Health Camps in Shakti Village
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Free Dental Camps in Shakti Villages
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i - Shakti In 2010, they started i-Shakti an IT-enabled
community portal across the state of AndhraPradesh. i-Shakti is designed to give rural peopleaccess to information via a network of villagekiosks containing internet linked computersrun by entrepreneurs.
Villagers can access free content, developed intheir local language, or email questions on awide range of topics, including Unileverproducts, health and hygiene, agriculture,
education, finance and employment. The aim is to have 3000 i-Shakti kiosks on stream
by the end of 2010 covering 9500 villages and18m people.
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iShakti Contd
Rural community portal that creates access to
information
Villagers can register as users and surf content areas: Agriculture, health, veterinary services, education,
employment opportunities, education, personal
grooming, entertainment, games
All content backed by local language voice-over
On all content areas, users can pose queries
1,000 kiosks in AP, partnership with government
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Appearance of ishakti kiosks
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SHAKTI ENTREPRENEUR PROGRAMME
It helps women in rural India set up smallbusinesses as direct-to-consumer retailers.
The scheme equips women with business
skills and a way out of poverty as well ascreating a crucial new distribution channel forUnilever products in the large and fast-growing global market of low-spendingconsumers.
By 2010 the Shakti network aims to havereached 600 million consumers.
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Objective
The Shakti entrepreneur program creates livelihood
opportunities for underprivileged rural women.
The Shakti Vani program works to improve the
quality of life in rural India, by spreading awareness
of best practices in health and hygiene.
They are also studying the consumption habits of
the rural people.
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Other Activities
To improve the business skills of the SHG women,
extensive training programmesare being held.
Workshops have already covered a large number of
Shakti Entrepreneurs in Andhra Pradesh,Karnataka, Gujarat, Madhya Pradesh, Uttar Pradesh,
Tamilnadu, Chattisgarh and Orissa.
As part of their training programme, all HUL
Management Trainees spend about 4 weekson
Project Shaktiin rural areas
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The factories that HUL continued establishing in
less-developed regions of the country have beenengaged in developing rural market in adjacent
villages.
These factory-centered activities mainly focuson training farmers, animal husbandry,
generating alternative income, health & hygiene
and infrastructure development.
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Participated States
Andhra Pradesh Karnataka Gujarat Chattisgarh Maharashtra Orissa Punjab Rajasthan Tamilnadu
Uttar Pradesh West Bengal Bihar Haryana Jharkhand
Vi i 2010
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Vision 2010
100,000Entrepreneurs
500,000villages
600millionConsumers
Shakti shall reach everyhome in everyvillage, create
sustainable livelihood opportunities, and enhance the qualityof life in rural India
Now SHAKTI has been extended 80,000 villages in 15 states
with 45,000 women entrepreneurs & generating Rs.700-1000
per month to each women.
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CONCLUSION
Project Shakti is enabling families to live with
dignity and in better health & hygiene,
education of the children and an overall
betterment in living standards.
it creates a win-win partnership between HUL
and the rural consumers for mutual benefit
and growth.
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