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PESTEL/PEST Analysis Of Hindustan Unilever (HUL) | Free PESTEL Analysis

PESTEL/PEST Analysis of Hindustan

Unilever (HUL)
by adamkasi | Dec 18, 2015 | Companies | 0 comments

Hindustan Unilever is one of the fastest growing companies in India. It is present in

India even before independence. With headquarter in Mumbai; it has more
than 18000 employees and over 1800 business partners. It owns famous brands
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like Lux, Ponds, Vaseline, Lipton, Pureit etc in India. It owns 29 manufacturing
facilities and has revenue of around Rs. 30170 Crore (INR) in 2014-15. It is no. 1 in
homecare, hair care, laundry care and skin care but no. 2 in oral care and beverages.
The products are aggressively marketed and known to be used by two out of three
Indians. (HUL, 2015)

Political
Indias deregulatory environment has helped MNCs in India to expand into various
products and services, after 1991 HUL also took advantage of this situation and
merged with Tata Oil Mills Company and Lakme Limited enabling HUL to enter new
markets of cosmetics and food oil of which it was not part before and wanted to enter.
Later on in 1994 it took over Kimberly Clark Corporation in order to take over
marketing of Huggies diapers and Kotex sanitary pads. HUL does not support any
political party or government by funding its operations since it is a business entity and
wants to restrict its operations to that eld only, also it knows how sensitive people
of India are in terms of political alliances. However, such MNCs, due to large funds
reserved for helping the government in improving the livelihood of people they
sometimes tend to exert pressure on government to pass out a certain law thats
favoring them. (BUSINESS OVERVIEW OF HINDUSTAN UNILEVER)

Economic
In 2009 when the whole world faced a major economic crisis, Asian countries were
least hit due to their not-so-strong reliance on interest based investments. When
Unilever was making in most of the countries abroad it remained pro table in India
although pro ts declined. Raw material sourcing is the rst step of supply
chain and uctuation in them could disturb the pricing of the products. The brands
that Unilever sells are everyday products so people are sensitive to their pricing and
constant price changes can put them o`. Chemicals
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PESTEL/PEST Analysis Of Hindustan Unilever (HUL) | Free PESTEL Analysis

and palm oil are the major raw material used and in ation keeps eating the bottom
line for soaps and detergents which are formed from these raw materials. India stands
on lowest level when it comes to per capita consumption on personal care products;
HUL has been trying to change that perception for years. In India HUL faces direct
competition not only by MNCs but also local producers who are successful to the
extent that it is almost impossible to break their market share and loyalty. (Wikinvest)

Social
HUL launched program Shakti for women in rural areas to empower them and make
them independent, earning their own livelihood and spending that income on improving
lifestyle of whole family. The project started o` with one woman being selected from
each village as Shakti woman who would buy Unilever products from company
representatives at a discount and sell these products for a pro t at her own village.
Another initiative by HUL includes increasing awareness among villagers about the
importance of cleanliness through Lifebuoy Hand washing Programme since 2010.
Through Pureit it is providing clean drinking water to millions of people. It has also
controlled environmental pollution by curtailing CO2 emissions, reducing waste
products and usage of water. HUL also promotes Equal Employment Opportunity to all
and encourage women to be a part workforce even after marriage and children and
make it easy for them to maintain a balance in their worklife and household
responsibilities, by opening daycares at o ces, providing exi timings and work home
facility.

Technological
For HUL technological development in India means more connectivity to people. Now
there are apps available which would inform the consumers when their favorite brands
are being restocked at their nearest supermarkets. For HUL it has become easier to
manage its large supply network and monitor the inventory situation. Factories have
been installed with automated operations which have eliminated the errors that manual
work could produce and also increased the productivity and e ciency.

Environmental
HUL has been in highlight for breaching environmental laws of dumping hazardous
chemical on a nearby land endangering lives of citizens and employees. This incident
happened at Kodaikanal factory where Unilever was accused of dumping and selling
scrap of glass material containing Mercury, when this was brought under light, HUL not
only closed down the factory but also launched investigation and tried to trace all the
material that has been sold to the dealer. The results of investigation showed that
illegal selling of scrap
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PESTEL/PEST Analysis Of Hindustan Unilever (HUL) | Free PESTEL Analysis

Mercury did take place which is the breach in code of conduct however the
manufacturing process itself was safe as was duly audited by both the company and
relevant authority. The company then had to clean all the scrap waste from the soil and
o`ered to stop the contaminated water from down the valley through placement of silt
traps. They took permission from both Indian and U.S. government to transport back
the waste material to U.S. for further processing. (Kodaikanal, India, 2015)

Law/Legal
HUL makes sure it adheres to all local laws of the state in which it is operating. For
example in Gujarat due to oods and drought the government put restrictions on
prices of all goods and services available in order to provide some relief to people,
HUL could not increase price of its brands despite of high cost of production. Moreover
at some states there are certain environmental laws which must be followed and HUL
has to abide by those. Basic laws are more or less the same with slight variations and
Unilever has to make sure that it does not violate any laws due to negligence, thinking
that same laws will be applied everywhere.

Bibliography
BUSINESS OVERVIEW OF HINDUSTAN UNILEVER. (n.d.). Retrieved December
15, 2015, from UK Essays: http://www.ukessays.com/essays/marketing/businessoverview-of-hindustan-unilever-marketing-essay.php
HUL. (2015). Hindustan Unilever Limited Factsheet . Retrieved December 15,
2015, from HUL: https://www.hul.co.in/Images/hul-factsheet_tcm1255436331_en.pdf
Kodaikanal, India. (2015, August). Retrieved December 15, 2015, from Unilever:
https://www.unilever.com/sustainable-living/what-matters-to-you/kodaikanalindia.html
Wikinvest. (n.d.). Hindustan Unilever. Retrieved December 15, 2015, from
Wikinvest: http://www.wikinvest.com/stock/Hindustan_Unilever_(BOM:500696)
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