DISTRIBUTION
Distribution Strategy
HUL has a strong distribution network through which it reaches to their target markets both urban and rural. it has an advantage of a large penetration in large and small towns something that it has built over the last few decades. Their distribution network of VPJ focuses on retail outlets. VPJ sales force should target other distributors and users such as institutional users for example hospitals with a first aid perspective. HUL's products are manufactured across the country and are distributed through a network of about 7000 redistribution stockists covering about 1 million retail outlets. The distribution directly covers their urban markets.
The distribution channel in general trade :
Direct and Indirect Channels:
Direct channel is a form of distribution in which the seller comes into direct contact with the buyer rather than employing intermediaries to sell the product. Such form of distribution helps sellers eliminate the extra cost incurred for intermediaries and helps develop a more personal relation with the customers. However, it limits the scope of reach that mass distribution through wholesalers and retailers achieves.
Indirect channels, on the other hand, consist of smaller organizations which act as intermediaries in the distribution of goods and services. Agents, wholesalers, retailers and other such distributors are facilitators that make the products available to the consumers across various geographical regions through departmental, supermarket and retail outlets.
Push and Pull Strategies of Distribution:
These are strategies by which sellers ensure that their products reach the target customers. In case of push strategies, the manufacturer’s sales force and trade promotion techniques (such as discount coupons, festival offers and schemes) come into play. They push the product to the customers and drive sales. Unlike this, the pull strategies are targeted at attracting the customers towards the products by way of advertising and other forms of communication. They persuade the customer that the usage of a certain product will benefit them greatly and provide the utility which has so far been unaddressed.
HUL has a strong distribution network through which it reaches to their target markets both urban and rural. it has an advantage of a large penetration in large and small towns something that it has built over the last few decades. Their distribution network of VPJ focuses on retail outlets. VPJ sales force should target other distributors and users such as institutional users for example hospitals with a first aid perspective. HUL's products are manufactured across the country and are distributed through a network of about 7000 redistribution stockists covering about 1 million retail outlets. The distribution directly covers their urban markets.
The distribution channel in general trade :
Direct and Indirect Channels:
Direct channel is a form of distribution in which the seller comes into direct contact with the buyer rather than employing intermediaries to sell the product. Such form of distribution helps sellers eliminate the extra cost incurred for intermediaries and helps develop a more personal relation with the customers. However, it limits the scope of reach that mass distribution through wholesalers and retailers achieves.
Indirect channels, on the other hand, consist of smaller organizations which act as intermediaries in the distribution of goods and services. Agents, wholesalers, retailers and other such distributors are facilitators that make the products available to the consumers across various geographical regions through departmental, supermarket and retail outlets.
Push and Pull Strategies of Distribution:
These are strategies by which sellers ensure that their products reach the target customers. In case of push strategies, the manufacturer’s sales force and trade promotion techniques (such as discount coupons, festival offers and schemes) come into play. They push the product to the customers and drive sales. Unlike this, the pull strategies are targeted at attracting the customers towards the products by way of advertising and other forms of communication. They persuade the customer that the usage of a certain product will benefit them greatly and provide the utility which has so far been unaddressed.
HUL has been able to introduce VPJ on the retail level with a high distribution penetration (92% in grocery stores and 96% in drug store). VPJ benefits from very good distribution converge and an intensive penetration on the retailer market. Regular distribution generated about 85% of the products ounce volume. these 85% of VPJ products are distributed through three principal retail outlets namely grocery stores, drugstores and mass merchandisers. 15 % are distributed through other outlets and variety stores.
However they still have to reach many untapped markets. Although 85% of the production to: grocery stores, drug stores, mass merchandise, food stores and 15% to other outlets.
There are various types of retailers:
Store retailers, Non store and franchising.
Hence we can conclude that most of HUL products and VPJ respectively have been directly sold through retailers to the final consumer. Thus the retailer plays a very important role in he distribution channel.
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