ASSIGNMENT 2

STEP 1:

INTRODUCTION:
Unilever is a manufacturer and supplier of fast-moving consumer goods globally. Unilever
specializes in the manufacturing, distributing, and selling of various trusted brands. Their
brands operate in five Business Groups, each with a clear vision laddering up to our purpose 1)
Beauty & well-being, 2) Personal Care 3) Home Care 4) Nutrition 5) Ice Cream. Unilever is the
largest producer of soap in the world and its products are available in around 190+ countries.
Unilever was founded on 2 September 1929, by the merger of the British soap maker Lever
Brothers and the Dutch margarine producer Unie. The company has a total of 148,000
employees worldwide and has an income of Euro 52 billion in turnovers in 2021 with 58% in
emerging markets.

Their purpose is to make sustainable living commonplace. They have a long tradition of being a
responsible and pioneering business. It goes back to the days of our founders, including
William Lever, who launched one of the world’s first purposeful brands, Sunlight Soap, more
than 100 years ago. And it is at the heart of how we run our company today.

They strive to do more good for our planet and our society – not just less harm. They want to
act on the social and environmental issues facing the world and they want to enhance
people’s lives with our innovative, sustainable and high-quality products.
This is how they will grow their business.

STEP 2:

UNILEVER’S OPERATION MANAGEMENT:

Unilever has 260 factories and over 46 warehouses across the globe resulting in them having
huge operations and supply management tasks on its hands. Unilever has distributed its
operations globally due to which the head office needs to coordinate and manage operations
at a global scale. That is why there is a need for operation managers to distribute
responsibilities. To manage each of the operational tasks effectively, operation managers have
been assigned to monitor, manage and report their operation progress following a hierarchy
leadership platform. This allows them to monitor operations, expansion planning and brand
development.
There are Six decision areas that the operation managers have been assigned to
manage namely:

1. Products/Service Design,
2. Quality Management
3. Location Strategy,
4. Layout design and Strategy,
5. Human Resources and Job Design,
6. Inventory Management

1. DESIGNING OF PRODUCTS AND SERVICES:

Unilever follows the strategic approach that suits the organization functionality in
their products and services development. Unilever operations management leads in
addressing the products development issues and challenges. Success is achieved
through continuous innovation to address consumer expectations.
For example, the company ensures to maintain high productivity in developing new
alternative forms or new variation forms of soaps and lotions (consumer’s most basic
necessity), while keeping beverage development highly productive. Increases
operational needs on this productivity and smooth process to support the
development and production of Unilever’s consumer goods. Operational team at
Unilever ensures design for an effective outcome. These results help to exchange with
market demand and extend organizations.

2. QUALITY MANAGEMENT:

Under this strategic decision area, Operational managers deal with satisfying
consumers’ expectations on product quality. Unilever emphasizes maintaining quality
standards in operational processes to satisfy product quality requirements.
For instance, the company set a threshold for defects and related issues in production
operations. However, these operations management standards are derived from
Unilever’s market research data, as well as conventions in the consumer good
industry. To maintain high productivity in quality management, corporate standards
and local standards are applied for certain product lines to support the company’s
generic and product development strategies.
3. LOCATION AND STRATEGY:

Efficiency and cost-effectiveness of locations are the main objective in this strategic
decision area of operation managers. Unilever aims to minimize the production costs
and transport costs of its consumer goods to reach target markets. For instance,
Unilever’s production hubs are typically close to the largest consumer goods markets.
The company also avoids locations that have uncertain situations and uncertain
events (political and culture issues) that affect negatively on operational productivity.

4. LAYOUT DESIGN AND STRATEGY:

Under this strategy area, efficient movement of information and resources are the
objective of operations management. Efficient flow of information is achieved through
computing technologies and networks in Unilever’s facilities. For instance, operations
managers easily access relevant data through mobile and online effortlessly. Unilever
maintains productive inventory operations through aisle layouts that minimize the
travel distance of consumer goods across distribution facilities.

5. JOB DESIGN AND HUMAN RESOURCES:

This strategy decision area, operations management determines the sufficiency of

human resources to support business operations. For instance, operations
managers ensure job design and corporate culture alignment to support
productivity and business’s performance.

6. INVENTORY MANAGEMENT:

Inventory ordering and holding are the responsibilities of operations managers. Unilever
is concerned with maintaining an adequate inventory of consumer goods to enable the
business to respond to changes in the market. For example, the company’s inventory
size is sufficient to address sharp increases in demand. Thus, operation managers must
accurately determine how much materials and consumer goods are needed in
Unilever’s inventory. To do so, Unilever applies the perpetual method and periodic
method of inventory management.
STEP 3:

LIST OF UNILEVER BRANDS:

UNILEVER BILLION EURO BRANDS:

These brands have annual sales of one billion euros or more:

● Axe/Lynx (Axe or Lynx is a brand of male grooming products).

● Dove
● Omo/Persil
● Heartbrand (Wall's) ice creams (Wall's is a British ice cream and frozen dessert
brand in United Kingdom owned by Unilever)
● Hellmann's (they are used for the same line
of mayonnaise, ketchup, mustard, sauce, salad dressing, condiments and other
food products)
● Knorr
● Lipton (Lipton is a British brand of tea)
● Lux
● Magnum
● Rexona/Degree (it is an Australian deodorant and antiperspirant brand)
● Lifebuoy
● Sunsilk
● Sunlight

FOOD AND

DRINK:

● Amora-Maille (A brand that manufacture condiments).

● Hellmann's (that are used for the same line
of mayonnaise, ketchup, mustard, sauce, salad dressing, condiments and other
food products).
● Colman's (it is an English manufacturer of mustard and other sauces).
● Knorr (is a German food and beverage brand).
● Continental (it is a manufacturer of side dishes and recipe bases and it is a
subsidiary of Unilever).
● Robertson's (spices/seasoning)
● Unox (soups, smoked sausages)
● Marmite (yeast extract spread)
● SariWangi (Tea)
● Conimex (Asian spices)
DESSERTS:

● Wall's (ice cream, frozen desserts)

● Ben & Jerry's (ice cream)
● Breyers (ice cream)
● Cornetto (ice cream)
● Darko (Дарко) ( ice cream) (Bulgaria)
● Fudgsicle (ice pops)
● Klondike (ice cream sandwiches)
● Magnum (ice cream)
● Popsicle (frozen treat)
● Seru (low-cost ice

cream) OTHER FOODS:

● Annapurna (salt and wheat flour)

● Maizena (cornstarch)
● Pot Noodle (cup noodle)
● Sealtest (milk products)
● The Vegetarian Butcher (Vegetarian and Vegan products)
● Telma (breakfast cereal)
● Unilever Food Solutions ( professional markets (food service)
● Chirat (pickled vegetables)
● Mãe Terra (Brazilian natural and organic food business)

BEVERAGES

● Bru (instant coffee)

● Buavita (fruit juice)
● Horlicks (malted milk powder)
● Jif (lemon and lime juice)
● Lipton (tea).

HOME CARE:

● Biotex (laundry detergent)

● Cif (cleaning products)
● Coccolino (softener)
● Comfort (fabric softener)
● Domestos (bleach)
 ● Quix (dishwashing liquid)
● Surf Excel (laundry detergent)
● Vixal (porcelain cleaner)
● Wheel (detergent)
● Sunlight (floor cleaning fluid)

BEAUTY, WELL-BEING AND PERSONAL

CARE:

● Aviance (Beauty products)

● Axe (deodorant, shower gel, body spray)
● Badedas (shower gels)
● Brisk (hair-styling products for men)
● Caress (soap)
● Clear (anti-dandruff, scalp care shampoo and conditioner)
● Close-Up (toothpaste)
● Dove (skin care, hair care, and deodorant)
● Dollar Shave Club (razors and other personal grooming products)
● Glow & Lovely (skin lightening product)
● Lakmé (cosmetic)
● Lifebuoy (soap)
● Lux –(women's soap, shower gel, and lotions)
● Pond's (beauty lotion, anti-aging, beauty cleansing foam, lightning toner and
lightning cream)
● Pepsodent (dental)
● Sahaja (cleaning products for Muslims)
● Seventh Generation (home and personal care products including bobble)
● Sunsilk (shampoo and conditioner)
● Tatcha (Luxury skin care brand)
● TRESemmé (hair care range)
● Vaseline (body lotion, shower gel, deodorant)
● Williams (men's care).
STEP: 4
DEPENDENT DEMAND:

These are the factors on which Unilever's demand depends:

● ADVANCED TECHNOLOGY:

Technology sits at the heart of Unilever's approach to innovation: Unilever is building

automated technology into our innovation centers. Unilever UK Materials Innovation
Factory (MIF) has the highest concentration of robots doing material chemistry work in
the world. It delivers data ten times faster than traditional methods. It runs virtual tests
and scenarios to optimize products before the lab stage, thereby innovating sooner and
cutting time to market - in one year we can perform 12,000 rapid product tests.
Shanghai, China is home of Unilever AI Hub where we use insights from real time data to
prototype innovations and test them via e-commerce in just a matter of days. Fast,
efficient, effective innovating.

● NEW AND INNOVATIVE CHEMICALS:

We’ve been innovating for over 100 years – from re-inventing soap in the late 19th
century to pioneering sustainable living today - we innovate for people, for society and
for our planet. Our people are specialists: they are innovators, scientists, engineers,
chefs, technologists, regulatory experts and data scientists in fields ranging from
material chemistry to animal testing alternatives. Some of our focus areas are hygiene,
skin care, premium beauty, plant-based foods and functional nutrition, such as vitamins,
minerals and supplements, and we're constantly evolving alongside our consumers’
ever-changing lives and tastes.

● COMPETENT LABOR:

Unilever has teams specializing in Science and Technology, Consumer Technical Insight,
Packaging Science and Product Development. Unilever’s employee selection criteria are
very advanced and difficult. It selects the only efficient and competent candidate out of
thousands of candidates. Which will save companies time and resources from wastage of
incompetence. Provide high pay and incentives, work life balance in order to make them
satisfied and retain them.
● HIGH WAREHOUSING CAPACITY:

Unilever has huge warehousing capacity which will help them to store goods nicely.as we are
catering about 70 to 80% market share, only in Pakistan Unilevers is running four factories
therefore, our production scale is also so wide. We need so much space to store stock for this;
we made huge warehouses to store goods.

● SCARCITY OF NATURAL RESOURCES:

Unfortunately, due to bad economic conditions there is a scarcity of water, electricity or gas
due to which production may suffer especially in winters when Pakistan faces gas crises;
industries of Unilever suffer a lot. They use alternatives like diesel or generators which
ultimately increase the product prices.

● AVAILABILITY OF RAW MATERIAL:

79% of raw material is taken from the agriculture sector in which Pakistan is rich. Unilever key
crops are palm oil, paper, board, soy, sugar, tea, milk, vegetables. Remaining percent is
import. Recently, Unilever Pakistan and tufail chemicals have launched Pakistan’s largest
production plant for key raw material Used in the production of shampoo. This plant makes
Pakistan
self-sufficient for this raw material, reducing the companies’ dependency on imports and opens
avenues for global export.

● TIMELY SHIPMENT OF RAW MATERIAL AND FINISHED GOOD:

Unilever used advanced technology, it managed its inventory through the software’s, which
reduces human error and does not interrupt the manufacturing cycle.
INDEPENDENT DEMAND:
1. SEASONAL VARIATION:

According to season or weather demand for products increases or decreases which affects the
company's sales.
In winter:
The demand of following items increases:
● Demand for hand cream
● Shower gel
● Moisturizers
● Petroleum jelly
● Conditioners
● Knorr
soups In
summer:
Demand for these products decreases
● Ice cream
● Water bottles
● Juice

2. MARKET TREND

● POCKET PERFUMES:

Unilever launched pocket size perfume, pocket tissues and small Sackets of goods as people in
Pakistan sometimes don't want to carry huge bottles or carry heavy bags.

● WHITENING CREAMS:

In Asia there is a trend of fair skin, people want to improve their skin tone , Unilever launched so
many glowing and fairness creams like fair and lovely ,ponds ,skin white, dove.

● SHAMPOOS:

Unilever launches shampoos by understanding people's desires and needs. In Asia people like
straight hair so Unilever launched shampoo that straightened hairs. Also there is a huge issue of
hair fall or dandruff, Unilever launched Hair fall solution, frizz control shampoos.
3. CUSTOMER:

Unilever has a huge target market in Pakistan and all over the world as well. Almost every day a
person uses 50% of Unilever's products. Unilever's target market is everyone from children to
elder. Its product line is so diversified it makes products for all age people like ice cream from
teenagers to elders.
Also they make their product attracting by using these factors such as
● Quality,
● reasonability,
● Price,
● Packaging,
● Fragrance,
● Pocket friendly.

4. ECONOMY:

They target different social classes and make products according to their earning scale. Unilever
show concern for all levels of people they have reasonable and luxury products for different
social classes. Like lifebuoy shampoo for lower middle class and Pantene for middle or upper
middle class

5. RETAILERS:

Unilever sells products according to regions and buying power of people. Like selling Sackets to
less privileged people who may can't afford huge bottles as they are costly or tissue paper rolls.
STEP 5:

TYPES OF INVENTORY IN UNILEVER:

In supply chain management we study that there are five types of inventories:
raw material, work in process, time, finished goods or MRO (Maintain repair and
operations). In this assignment we discuss which type of inventory used in
Unilever business as we categorize their products in above, so considering those
we say that two types of inventory used in Unilever.

1- Raw material

2- Finished goods

1) RAW MATERIAL:

Unilever possesses the inventory in raw form like for creating shampoos
they use raw chemicals and specific formula to create different brands of
shampoo like Dove, Sunsilk and Lifebuoy. The different categories of
nutrients food like knorr, Horlicks and Hellman’s vegans so in this using
inventory like cocoa powder or some nutrients to create Horlicks then pack
it and convert it into finished goods product.
In raw material inventory using different forms of direct and indirect
raw materials to convert the product into final product. They offer
different Ice-cream brands with different specialized formulas and
ingredients. In detergent products they also used raw material then
processed into the final product.

2) FINISHED GOODS:

Finished goods inventory is the most straightforward inventory type, which

is converted raw material into finished goods products. We say that the
Finished goods products are those which can be available at stores,
warehouses or in the product websites. Any product which is ready to sell
 to the customer is considered finished goods. Unilever produces products
in Bulk quantity according to the specific current product demand as well as
their products have certain times to be in the same forms like shampoos;
soap or lotion is not expired early but stored for a long time. Finished goods
are stock in bulk quantity and Unilever stores the products in bulk.

REASONING AND JUSTIFICATION:

● Types of inventory of Unilever is raw material and finished goods because

they processed some mixtures and chemicals to creating specific shampoo
brand as well as make sure to hammering the image of the Brand of
product through enhancing packaging of products like Dove and Sunsilk
both are shampoo even general public don't know about their this favorite
products have same parent company but the packaging smell or ingredients
differentiate the both shampoo product in different Brand.

● Here as a user of Tresemme I won't find any difficulty to purchase the

product that’s show that they were produce in bulk and have a wide
distribution channel so the finished good are easily accessible for
customers

● Another example of Knorr brand of Unilever they offer some Different

products so let’s discuss with Knorr Tomato ketchup they get the raw
material inventory like sugar, tomato paste , garlic, Acetic acids and
spices etc. going through different process and converted into Final
Product (Finished goods) and stock it in stores shop ware houses etc.
These are a few examples showing Unilever as a parent Company using which
type of Inventory. For a Huge business like Unilever segmented their business
and in their segments we identify they used Raw material inventory or Finished
goods inventory.