In a recent news published in ZEE Business, it was reported that prices of some household products of the brand Hindustan Unilever have been curtailed to a maximum 25%. This includes popular household cleaning and personal products like Surf excel, Rin , Vim & Lifebuoy.
The aim of this move by Hindustan Unilever is to change its volume growth drive. This means, the company shall stress on increasing demand of product than revenue. By this strategy, the company can gain increased sales volume, profits and and potentially more market value. This instance was seen in 2017 also by HUL, but that was to pass on the benefits of recent reduction in Goods & Services Tax rates to consumer.
Now, the as authority announced, there will be increase in quantity proportion rather than the prices which will lead to a reduced rate of 10-15%. For example, quantity proportion has been raised of Rin Bar by 20gm to 140gm, but the price remains the same. On the other hand, the prices of surf excel matic and surf excel liquid dish wash has been reasonably curtailed to Rs. 199 and Rs. 190 respectively.
In January, 2023, India’s fastest-moving consumer goods has scaled to 0.54% up which will continue to rising this year.
|Product||Old Price||New Price||Reduction%|
|Surf Excel Matic||220||199||9.5%|
|Surf Excel Easy Wash Liquid||250||190||24%|
With the soaring inflation in daily essential goods, consumers get a lucrative opportunity by this price down. Many have called it an effective trend to increase profits.
Companies can drive their volume growth by such innovative ways and improve their quality and distribution chain of products.
Overall, the volume growth drive is contributing factor to the companies’ growth strategy which will increase their revenue, market, and profitability.