Procurement Management of Unilever Tea Suppliers

Running head: GLOBAL PROCUREMENT
Global Procurement
Name of the Student
Name of the University
Authors note

1
GLOBAL PROCUREMENT
Abstract
A company could reduce their costs and increase their brand impact through understanding
the relevance and importance of procurement management. The high competition in the
market has popularized the outsourcing in the business world. Suppliers are playing a crucial
role in determining various aspects of business like manufacturing cost, increase product
quality, company reputation, and the confidence of stakeholders. This paper aims to
understand the procurement management of Unilever in respect to their tea suppliers. This
company has established itself as the highest buyer of tea all over the world. To sustain their
reputation in tea selling, the company depends on sustainable sourcing. This company has
outsourced tea for their reputed brand from all over the world. To get the ultimate benefits
from its suppliers, the company uses strategic management of their procurements. The
customers are more informed and knowledgeable about the age of the internet. A
knowledgeable customer shows its interest in every aspects of the brand they are using. The
tea suppliers of these organizations are part of various sustainable projects. They also
participate in sustainable programs of the NGOs and national and local governments.
Unilever is a member of ETP or Ethical Tea Partnership. The company works for the welfare
of the tea garden workers and make sure that their suppliers are gathering tea leaves form the
Rain Forest Alliance farms. Unilever shares the information of their tea suppliers and how
they buy from them to keep their procurement process transparent.
Keywords: procurement management, sustainable suppliers, procurement strategies, supplier
selection, criteria, ethical, environment friendly, tea suppliers

2
GLOBAL PROCUREMENT
Table of Contents
Introduction....................................................................................................................3
Methodology..................................................................................................................3
Discussion......................................................................................................................4
Organisation Overview..............................................................................................4
Existing Procurement practices and their effectiveness.............................................7
Areas of further improvement....................................................................................9
Conclusion....................................................................................................................11
References....................................................................................................................12
Appendices...................................................................................................................14

3
GLOBAL PROCUREMENT
Introduction
Companies in modern business employ a number of management techniques to make
their operations and functioning intact. Procurement management is the part of management
where the services and goods are obtained from different firm or organization. Procurement
management ensures the optimization of organizational spend. The process of procurement
management consists of getting the best deals from the suppliers at the lowest cost and on or
before time. Most of the companies have to rely on their suppliers to get the raw materials
and other goods for their business. Procurement is important to find the right deals and
agreements in services and goods that are to be acquired from external sources. Procurement
includes competitive bidding and tendering for decisions in good buying. The management of
procurement have some integral steps like sourcing, ordering, requisitioning, expediting,
inspection, and reconciliation.
Companies attain various methods to manage their procurement requirements. This is
done in some steps. In general terms, the first step of procurement management is planning.
The management team has to plan what their requirements are and how they want to do it.
The sellers or the suppliers then get the required contracts. Among various tenders, the
company chooses the best deal. Follow up of the contact is the part of procurement
management as well. The procurement process does not end with the sign of the contract. An
organisation that has started working with a supplier have to keep an eye on the fulfilment of
quality and quantity promised. The challenges that the companies face in their procurements
could be based on various factors including the delays in supply, finding effective tools and
strategies, managing stakeholders, risk mitigation, managing RFx process and getting
accurate data.
Buying procurement form the suppliers is a normal and regular process for any
organization. This business activity becomes crucial as it helps the company to flourish and
stay in the competition. Basically, it is about maintaining a relationship with the suppliers and
vendors for getting the required goods and services. Understanding the need of the customer
and stakeholders is necessary to have successful procurement management. Organizations
need to look outside their known market as well to have innovative ways for their
procurement process. It is a process that needs specialized personals and team. The
procurement team in a company should have the experts who can evaluate suppliers, connect
them with stakeholders and customers need, negotiate logically with the suppliers about the
contract and make sure that the supplied goods are meeting the specific standard and needs of
the company. The company policies of the services and goods need to be well-known by the
procurement management team. The ethical issues in selecting the right vendor and not
showing any favouritism attitude to the suppliers is another important part of this
management. All these aspects of procurement management are highlighted in this report
through the case study of Unilever tea providers. The study will evaluate the procurement
strategies of the company, compare them with the most effective ones according to the
researches, and would suggest some changes wherever necessary.
Methodology
This study is done using mixed methods that involve both secondary and primary
analysis. This is qualitative research, and the data are collected from the company balance
sheets, documents of procurement, and employee survey.
The first step for collecting the data was to understand the research requirements. This
study is dedicated to understanding the procurement management of the Unilever Company’s