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Project Shakti

India is a country whose heart still thrives in its villages. About 70% of Indias population lives in rural areas. FMCG sector is facing a cut throat competition in urban areas and this competition is even getting tougher with the advent of too many companies. This has led to saturation which in turn has forced the companies to look at rural India. Rural Indias income has increased gradually since the past few decades. Government provided subsidiaries as well as schemes like NREG has helped in increasing the disposable income in rural India. HUL is one of the giants in FMCG and is also the first one to launch its product in thousands of rural areas with the help of its natives. The project was named SHAKTI and was first launched in 2001 in 50 villages of Nalgonda district of Andhra Pradesh. About Project Shakti: The project was aimed to provide thrust to the reach of HUL as well as to help empowering the women in these areas. Covered village whose population was less than 2000. HUL partnered with SHGs (Self Help Group) to demonstrate and influence the women in the group, about the project. HUL in collaboration with local banks helped in providing micro credits to the SHGs women. The women selected was trained for three months to be a direct-to-home distributors after which she used to take the products in a box to the nearest villages and sell them door to door. The women used to do most of the travelling on foots. A part of the sale was given to the women. The women were called Shakti Ammas. In 2010, HUL brought a new idea to bring in the male member of the Shakti home to be called as Shaktimaan. The project also included Shakti Vani and iShakti in their project. Through Shakti vani, the product is marketed by announcement at a called gathering by Shakti Ammas. iShakti is an internet enabled kiosk, provided at every Shakti houses, which help the natives in gathering knowledge about agriculture, health, hygiene etc and also one can ask an expert to clear any kinds of doubts the one has related to these products. Currently Project Shakti is active in 15 states employing 48000 shakti ammas selling products to over 3.3 million households in 135,000 villages in India.

SWOT Analysis of Project Shakti: Strengths: Increased the reach of the company to villages. Low transportation cost. Low to moderate inventories. Direct to home marketing. Push strategy. Low labour cost. The project empowers women and also helps in providing micro credits.

Deep penetration capacity and ability. Rise in disposable incomes of rural natives. Distribution cost is far less than when compared to urban areas. Supply chain is strong wherein the company takes the products in vans, which in a sense is a mobile distribution centre, to the star sellers and from them to Shakti Ammas. Shakti Ammas pay some security before becoming a seller which saves the company from a loss or risks. The involvement of natives bring in the advantages such as better understanding of environment, knowhow of locality and more social contacts. The project has also helped the company in developing a social image in the market especially among people in villages.

Weaknesses: The women under SHGs are illiterate. Training them takes time. Social barriers and customs, in which women are not allowed to go out of their homes acts as hindrance. The margin of profit is not much in the products offered in the rural market. No specific target is given to the distributor. Most of the time is spend in creating awareness about the products.

Opportunities: Threats: Customs and traditions. Distributor defaulting rates. Environment and geographical uncertainties Since, the lives and earnings in villages depend mostly on harvesting and growing crops and vegetables, any unprecedented calamity can be a threat. Change in government or government schemes and subsidiaries. Big market. Less competition. Better conditions for reach of products. Government schemes and subsidiaries has raised the level of income. The harsh and stringent customs that dominated males over women is gradually diminishing. Villages are closely connected. Natives have stronger social bonds. The customers i.e. people living in villages never were exposed to such varieties and advance means of maintaining hygiene. Pristine environment.

Conclusion: HUL through its innovative and social ideas was able to increase their sales. Presently, HULs half of FMCGs sales come from rural market. The Shakti project entrepreneur has almost ten percent contribution in the total national turnover. The project not only created benefits for the company but also enhanced livelihood of 75000 rural women by INR 18 crore.

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