BUSINESS MANAGEMENT

Presentation on Macro Environment

of HUL
 INTRODUCTION

I've selected Hindustan Unilever Limited as my case study for

this presentation. In this article, I will discuss what the term

"macroenvironment" is as well as the macro-environmental

factors that influence HUL. I will also discuss how a SWOT

and PESTEL analysis of the HUL business happened, and

how SWOT helped the company expand, face, and sustain

itself while PESTEL assists in sustainability.

 Macro Environment

A macro environment is the collection of factors that affect

the economy as a whole compared to just one industry or
geographical area. The term "macro environment" describes
external influences on a business. The macro-environment
shows a nation's economic conduct and plans based on
macroeconomic factors. As a result, companies attempt to
understand and analyze the external environment and its
effects. It consists of different economic and non-economic
external factors that affect how businesses operate and make
decisions.
 (Heubel, 2022)

Macro Environmental Factors and Their

Influence on HUL

A crucial component of strategic management is macro

environment analysis. To find socioeconomic factors that
presently influence or may affect the company in the future,
business researchers frequently perform a PESTLE study.

The following are some of the major factors of the macro

environment:
1) Inflation and Deflation
The increase or decrease in product prices as well as
wage variations have a significant effect on buying
power.
The need for Hul's Resisting products can be impacted
by inflation rates. Higher inflation might force Hul's
Resisting to keep raising prices to keep up with inflation,
which might result in weaker levels of brand loyalty and
ongoing cost-control activities. A poor approach in these
circumstances might be cost-based pricing.
2) Consumer Spending
Supply and demand for goods are impacted by changes
in buying power.
Contrary to the shares of the manufacturing, goods, and
agricultural sectors in the economy, the share of services
is constantly rising.
3) Monetary Policy
By implementing suitable monetary policies, the Federal
Reserve manages the country's monetary situation.
Liquidity has entered the international financial markets
as a result of the Federal Reserve's quantitative easing
 program. In these cases, Hul's Resisting can obtain
affordable finance. When interest rates rise, however,
this approach is risky.
4) Fiscal Policy
To deal with negative circumstances like inflation or
decline, the government frequently adopts constrictive or
expansive measures. These metrics deal with taxation,
borrowing, and government spending.
The government of the nation operates fiscal plans, as
was stated in the governmental factors. The consequence
of Hul's Resisting is that it could increase short-term
product sales but subject the company to medium-term
currency and deflation risk.
5) Gross Domestic Product
All the goods and services created in a community are
combined to form the total output of the nation. While a
rising GDP represents a healthy economy, a falling GDP
indicates a weak economy.
By improving its product line and focusing on new
clients, Hul's Resisting can benefit from this pattern.
Analyzing how customer purchasing patterns and new
value propositions have changed is a good place to start.
6) Employment Levels
Business processes are significantly impacted by
unemployment and the supply of skilled labor.
Regardless of wages not showing these increases, the US
labor force's productivity has increased by 25–30% over
the past 20 years. It might make it possible for Hul's
Resisting to recruit qualified employees at market-rate
wages
 SWOT Analysis Of HUL

The SWOT (strengths, weaknesses, opportunities, and threats)

analysis is a method for assessing a company's competitive
situation and for creating a strategic plan.

SWOT Analysis According to HUL

Unilever's SWOT analysis identifies a variety of key
opportunities for the company's substantial development and
entry into the global market.

1. Strengths

 Brand recognition: HUL influences the everyday lives of

1.3 billion people by providing products like cleaner and
 mineral water. With its 20 consumer groups and position
in the consumer goods industry, HUL was able to fill up
a lot of department store shelves, which in and of itself
explains the market wants for their goods.
 Product line: It provides a variety of product types,
including those for oral care, personal care, domestic
surface care, fabric care, and animal food.
 Financial situation: HUL is in a solid financial position
thanks to its more than 80 years of expertise in the
consumer goods industry and support from Unilever,
which holds a 67% ownership stake in the company.
 Market share: HUL was able to maintain a significant
market share across a range of product groups thanks to
its high market dominance.
 Leader in the consumer products market.

2. Weaknesses

 Market share declining: HUL's share has been taken

away by rivals who concentrate on a single product, such
as Ghadi and Nirma soap, which dominate the market for
process detergent.
 Many identities in various merchandise categories: A
diverse brand collection can occasionally result in
 confusing communication. Price placement in some
markets enables low-cost competition, as when AMUL
seized Kwality's market share.

3. Opportunities

 Market expansion: By expanding its presence in remote

areas through its initiative Shakti AMMA and converting
unorganized businesses to organized ones, the consumer
products market will continue to grow.
 Consumer product utilization is increasing as a result of
people becoming more informed and cognizant of their
use, whether it be through advertising, word-of-mouth
recommendations, or medical prescriptions.
 Increasing income levels: People's wealth is rising as a
result of a secure political environment, increased
literacy rates, and tightly managed inflation, which is
driving up demand and modifying people's lifestyles.

4. Threats

 Market competition: It's getting harder and harder for

businesses to set themselves apart from rivals as there are
more local and national competitors. Additionally, the
 market picture of its name could be destroyed by
imitation products.
 Commodity prices: Increasing commodity prices will
lead to further price increases. Sales, profits, and brand
moving will all suffer from further price increases.
 Buyers' power: In the highly diversified consumer goods
market, where many brands are claiming various
benefits, it is very difficult for consumers to stick with
one brand. This leads to brand switching, where
consumers have the power to choose a brand based on
availability, reference group suggestions, preference, and
price.
 PESTEL Analysis of HUL

The term PESTEL stands for the tool used to determine the
macro (external) factors that an organization must deal with.
The initials stand for Political, Economic, Social,
Technological, environmental, and Legal.
1. Political Factors

With the aid of Indian laws and the merger of Hindustan

Unilever with Tata Oil Mills Company and Lakme,
Hindustan Unilever was able to grow into new markets
such as cosmetics and food oil.
Hindustan Unilever is not supporting any political group
or government because it is sensitive to everything in
India.

2. Economic Factors

HUL continued to make money in India even as it was

losing money in most foreign markets.
Because it distributes items from the everyday market,
Hindustan Unilever is constantly under pressure,
resulting in continuous price changes.
Additionally, MNCs and local producers present a direct
competitor for HUL, making it nearly difficult to keep
both customer loyalty and market share.

3. Social Factors

Hindustan Unilever has grown its consumer base through

social campaigns.
 Another initiative sponsored by Hindustan Unilever is
Lifebuoy Swasthya Chetana. This practice concentrates
on helping people stop having diarrhea.
HUL concentrates on small communities through its
Project Shakti initiative. Through it, Hindustan Unilever
is assisting rural women to live better, more hygienic
lives by considering their needs.

4. Technological Factors

With the help of technical development, Hindustan

Unilever has been able to solve the issue of consumer
engagement caused by technological advancement.
The most current IT innovation is being used by HUL.
Hindustan Unilever has begun marketing its goods
online, and only digitalization made this feasible.
HUL has been able to use its technology to evaluate large
amounts of client data to determine which products sell
more and by how much.
Technology has also aided HUL in better understanding
and utilizing relationships with customers in modern
businesses.

5. Environmental Factors
 Hindustan Unilever has consistently made headlines for
flouting the laws of nature and discharging dangerous
substances, risking the lives of their employees and the
people who live close to their plants.
The US and Indian governments granted HUL
permission to dump the waste by their national
regulations.
HUL needs to be more controlling about following
environmental regulations and improving every
individual's environment.

6. Legal Factors

HUL makes sure that when operating and marketing, it

complies with all applicable state and local laws.
For it to operate properly, HUL must abide by all
applicable natural laws in the states.
The remainder of the laws that HUL follows is largely
the same as those that any other MNC follows by; it only
needs to watch out that it doesn't misuse or break any
laws.
 How PESTEL Helps in the Sustainability
of HUL
 The PESTLE Analysis illustrates the various external
situations that affect the reputation of the company.
 Companies like HUL (Hindustan Unilever) must use the
PESTLE analysis framework because it helps them better
understand market trends and constantly improve their
operations.
 This PESTEL/PESTLE study demonstrates a variety of
opportunities and threats that Unilever must focus on in
its development and international expansion strategies in
the consumer goods market.
 Additionally, it is recommended that the business
improve its sustainability initiatives to take advantage of
business sustainability possibilities.
How SWOT helps HUL to Grow, Survive,
and be Sustainable
 It will give the decision-makers a better understanding of
the market, the company, and the rivals.
 Hindustan Unilever managers can find process-related
weaknesses by using SWOT analysis.
 Future development of Hindustan Unilever can be
sustained by managing and removing these weaknesses.
 Hindustan Unilever's decision-makers can still use
SWOT analysis to evaluate the advantages and
disadvantages of new projects, as well as their initial and
long-term profitability, while also considering the
strategies of their rivals and the macroeconomic
environment.
 Setting strategic objectives, identifying key target areas,
and specifying desired outcomes are the simplest
objectives for which Hindustan Unilever can use SWOT
analysis.
 CONCLUSION

I'll end this presentation by saying that by researching

Hindustan Unilever Limited's case study, I've gained a better

understanding of the macroenvironment, the factors of the

macroenvironment that affect HUL, its SWOT and PESTEL

analysis, and how those analyses support HUL in

sustainability.
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