Unilever's Green Tea Supply Chain: Strengths, Weaknesses and Recommendations

This presentation explores the integrated supply chain of Unilever's Green Tea, identifies its strengths and weaknesses, and provides recommendations to make it more competitive. The supply chain includes smallholders, manufacturers, international traders, retailers, and consumers. The material, information, and money flows are analyzed. The strengths of the supply chain include Unilever's long history of manufacturing tea, its competitive distribution channel, and the increased health consciousness among the US population. The weaknesses include huge geographical distances from tea plantation countries and political changes in various countries' environment. The presentation concludes with recommendations for Unilever to find more smallholdings farmers and expand its online base of selling green tea.

Food Marketing
(Supply chain of unilever`s green tea)

Introduction
 The supply chain manages the movement of goods from the point of manufacturing to
the point of consumption.
 The main objective is to identify an integrated supply chain of “Green tea” of Unilever
and analyse the supply chain in the light of strengths and weaknesses.
(Source: AIIMS, 2018)

Supply chain
smallhold
er
Estate
productio
n
Manufactur
er
Internation
al trader
Retaile
r
Consume
r
Material flow
Information flow
Money flow

 Material flow- Material flow includes smooth flow of goods from the
manufacturer to consumer. The flow of material would not be possible
without the assistance of traders, retailers and consumers.
 Information flow- Behind every successful supply chain, the reason is
regular interaction and communication between manufacturer and
consumer. Every loop of supply chain helps in transferring information
from source to final destination.
 Money flow- Invoices raised by producer, the consumer check the
order placed. If the money claimed by the manufacturer. Either
through cash or electronic money is transferred from the consumer to
respective producer.
Three different types of flow in
Unilever`s Green tea supply
chain

Elements of supply chain
 Manufacturer
Unilever is connected to millions of small tea producers who earn their
livelihood through tea.
The company takes the raw material from 750000 smallholdings, primarily
from Asia, Africa, Kenya and Tanzania.
 International Trader
Green tea has acquired a place in beverages because of its health benefits.
The company acquired the famous Pukka Herbs Ltd which gives 100%
certified and organic ingredients. Pukka has become premium players in
organic, natural, health herbs.

 Retailer
The sale of green tea has been growing through
retail stores, supermarkets, convenient online
platform such as amazon, flip kart. In India, the
company is able to expand its green tea operations
from Punjab to Karnataka (Gwynn, 2017) .
 Consumer
Maximum revenue of green tea is earned by target
market including college students, health
conscious people and working professionals
(Unilever, 2018).
(Source: Industry forum,
2018)

Strength of Supply chain
Supply chain of Lipton green tea is owned by
Unilever. Unilever has long history of
manufacturing tea.
The company enjoys the advantage of increased
health consciousness among US population and
the health benefits of green tea are unavoidable.
Unilever has the most competitive distribution
channel supply chain. This competitive
advantage among the competitors will lead to
reduce the outsourcing costs.

Weaknesses of Supply chain
 Huge geographical distances from
tea plantation countries. The
company has found that the to
accomplish the demands, it needs
more tea smallholding farmers.
 Political changes in various
country`s environment can hinder
the business especially from where
major raw material of
manufacturing of green tea is
imported.
(Source: biogasmaxx, 2018)

Recommendation
 Unilever should find and identify some more smallholdings farmers to
accomplish the emerging demand of the customers.
 Unilever has been using supermarkets, local retailers, and online
platform such as amazon, paytm, grofer and flip kart and to make its
product available to wide range of customers. However, it should
expand its online base of selling green tea such as in everyday.

Conclusion
 The strengths of Supply chain depend on strategies implemented for
managing the distribution channels.
 Apart from knowing the strengths and weaknesses of the supply chain,
the company has to identify the factors which influence and affects the
operations of distribution channels. The factors are government policies,
political factors, geographical factors, and social factors.
 The implementation of recommendations shall make the supply chain
the company more competitive.

References
AIIMS, (2018) What is Supply Chain Management?[online] Available on:
http://www.aims.education/study-online/what-is-supply-chain-management-definition/ [Accessed on 01/09/18]
Perepa, S. (2014) The need for a supply chain management system today. [online] Available on:
https://www.ibm.com/blogs/cloud-computing/2014/06/11/need-supply-chain-management-system-today/
[Accessed on 01/09/18]
study,.com, (2018) Cooperative Advertising: Definition & Examples. [online] Available on:
https://study.com/academy/lesson/cooperative-advertising-definition-examples-quiz.html [Accessed on 01/09/18]
Gwynn, S. (2017) Unilever is buying the Tazo tea brand from Starbucks. [online] Available on:
https://www.campaignlive.co.uk/article/unilever-buying-tazo-tea-brand-starbucks/1449194 [Accessed on 06/09/18]
Unilever, (2018) less sugar, fewer calories. [online] Available on:
https://www.unilever.com/sustainable-living/improving-health-and-well-being/improving-nutrition/health-and-well-
being-in-our-kitchen/less-sugar-fewer-calories/ [Accessed on 06/09/18]
Industry forum, (2018) Supply Chain Success [online] Available on:
https://www.industryforum.co.uk/resources/insights/supply-chain-success/ [Accessed on 06/09/18]
biogasmaxx, (2018) services. [online] Available on: http://www.biogasmaxx.com/english/services_e.html [Accessed
on 06/09/18]