“What is our business?” Unilever is a global business that specializes in production of food and beverages, home, health and personal care products (“Introduction to Unilever”).
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“Who are our customers?” Unilever operates globally: the company offers goods for consumers who live on all continents of the World (170 countries worldwide). Due to a broad range of goods, customers with different buying capacity purchase products of Unilever.
“What do our customers want?” The company’s customers expect high-quality, safe goods that meet their expectations and needs.
“What should our business be?” Despite substantial scale of operation, the company plans to grow and gain competitive advantages. Unilever works to create the image of a strong, socially responsible company that cares for its customers, environment and the society.
The company operates worldwide and is well-known to their current and potential customers. The company’s brand portfolio is very broad (400 brands) (“Introduction to Unilever”). During the years of its operation, Unilever has set favorable relations with its suppliers and retailers. Substantial volume of production gives opportunity to benefit from economy of scale and thus get a competitive advantage in price. Company is willing to carry out research and improve its products (ibid.)
Several indicators of the company’s operation demonstrate negative tendency. In 2010, turnover (2010 to 2009) shows growth in Asia and Africa (20.8 per cent), North and South America 17.3 per cent); however, in Western Europe, the growth is absent (0.0 per cent) (“Q3 2010 Results Announcement” 12). The indicators of trading work capital turnover and free cash flow growth are negative (“Q3 2010 Results Presentation” 27).
Besides, the gross margin change in the third quarter is -120 bps (12). Market value growth is negative on both developed and emerging markets (6). The company has difficulties with promoting its social responsibilities: the company is criticized by its former workers and Greenpeace for “dirty” production and insufficient care for its employees and environment (Greenpeace).
The needs of consumers evolve, and the company has opportunities for developing new products and advancing the existing brands. Healthy products become more and more in demand, and the company has opportunity to “conquer” this niche. The economies of many developing countries demonstrated rapid growth; the company’s emerging markets now demonstrate rapid growth (“Q3 2010 Results Announcement” 12), which also creates attractive opportunities for it.
Competition becomes tougher and tougher; the threat comes from both competing global companies and local retailers’ brands (The Economist).
As the company is global, it may manage its brands globally. Unilever should develop innovative health products and offer them on developed markets where consumers’ requirements are high and where the company’s growth has stopped. The company may prolong old brands’ life cycle on the emerging markets where the economic growth takes place.
Unilever should intensify its operation on the emerging markets to improve the indicators of its activity and conquer market share. The company should produce healthy goods and improve its image as the environmentally-friendly company, as this is what a modern consumer is oriented on.
Being a global company, Unilever should use its competitive advantages when competing with other companies. The company should study the market and the offers of its competitors (global companies and retailers) to develop a competitive strategy. The company should intensify activity on emerging markets in order to conquer leading positions on them.
The company should optimize its financial strategy to improve the indicators of its operation. To compete with global and local companies, the company can put effort into marketing and compete in price.
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Despite existing weaknesses and threats, the company has significant potential for growth. To compete successfully and meet customers’ requirements, the company should offer health innovative products to the developed markets; it should intensify its activity on the emerging markets, as there are significant prospects of growth there. The company should carry out marketing research and marketing campaigns.
|Company Profile: |
Operation in 170 countries worldwide, 400 brands, specializes in food and beverages, health, personal and home care products.
|Strengths – S ||Weaknesses – W |
|Opportunities – O ||SO Strategies ||WO Strategies |
|Threats – T ||ST Strategies ||WT Strategies |
Greenpeace. “Unilever Admits Toxic Dumping: Will Clean Up but Not Come Clean.” U.K. Web.
The Economist. “Path to No Growth.” 2004. Web.
Unilever. “Q3 2010 Results Announcement.” 2010. Web.
Unilever. “Q3 2010 Results Presentation.” 2010. Web.
Unilever. “Introduction to Unilever.” Web.