Strategic Business Management of Unilever: A Detailed Report

This report provides a comprehensive analysis of Unilever's business management, focusing on its strategic business units, particularly the "Food and Drink" sector. It examines Unilever's product lines, revenue generation, and external environment, including political, economic, socio-cultural, technological, legal, and competitive factors. The report also explores Unilever's sources of sustainable competitive advantage, such as its asset-driven approach, branding, and the Unilever Sustainable Living Plan. Furthermore, it discusses the strategic direction Unilever should take to remain competitive, emphasizing innovation and sustainability. The analysis covers key brands, revenue trends, and the company's adaptation to consumer demands and environmental concerns. The report highlights Unilever's efforts in nutrition enhancement, sustainable sourcing, and digital marketing strategies, concluding with insights into its competitive positioning and future prospects.

Running head: BUSINESS MANAGEMENT OF UNILEVER
Business Management of Unilever
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Executive Summary
The primary aim of this report is to discuss about the corporation called Unilever and its
business unit “Food and Drink”. It discusses about the strategic business unit and the product
lines of Unilever. It also states about the revenue that it gathers from that of the strategic
business unit and analyses the external environment of Unilever. It also expounds on the
source of sustainable competitive advantage of Unilever and the strategic direction that can
help it to stay relevant in the present competitive market.

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Table of Contents
1. Introduction............................................................................................................................3
2. Corporation Identification......................................................................................................3
3. Business Unit Research..........................................................................................................4
4. Business Unit Revenue..........................................................................................................5
3. External Environment Analysis.............................................................................................6
6. Source of Sustainable Competitive Advantage......................................................................7
7. Strategic Direction.................................................................................................................8
8. Conclusion:............................................................................................................................9
References:...............................................................................................................................10

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1. Introduction
The activities which are associated with that of the running of a company can be
termed as business management. It includes the activities like that of controlling, monitoring
and organizing. Co-ordination of the different activities in a business that can help in
achieving defined objectives is the primary aim of business management of an organization.
Unilever is a transnational company dealing with consumer goods that is headquartered in
United Kingdom. The products of the corporation include that of food, beverages along with
personal care products. Unilever is the largest company that deals with consumer goods in the
world on the basis of the revenue of the year 2012. This report throws light on the product
and service portfolios of Unilever and the largest amount of revenue that is received by the
corporation in relation to the sector of “Food and Drink”. It also elaborates on the external
environment and the sources that provide sustainable competitive advantage for the
corporation.
2. Corporation Identification
a)
Unilever is a very old multinational company and the products of Unilever can be got
in nearly 190 countries. It is the owner of 400 brands and the turnover of the comoany in the
year 2016 was around 50 billion euros. The thirteen brands of Unilever that has sales more
than one billion euros include that of Axe, Surf, Dove, Sun Silk, Flora, Rexona, Heartbrand
Ice cream, Rama, Hellmann, Knorr, Lux and Lipton (Unilever.com 2018). The four main
divisions of Unilever are that of Foods, Refreshment, Home care and that of Personal Care.
Unilever was created in the year 1930 after the merging of Margarine Unie and that of British
soapmaker Lever Brothers. The corporate acquisitions of Unilever include that of Lipton,

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Dollar Shave Club, Brooke Bond, Alberto-Culver, Ben & Jerry’s, Best Foods and
Chesebrough- Ponds.
A corporation refers to a legal entity that acts in a separate manner from that of the owners.
A corporation has the privilege of entering into contracts, hiring employees, owning assets
and that of paying of assets. Product Portfolio refers to the collection of products that is
offered by a company. The companies that are matured have diverse range of product
portfolios. The different kinds of product of Unilever are that of food, cleaning agent,
beverage and that of personal care product. The brands that are made by Unilever are used by
around 2.5 billion people on daily basis. Under the business unit of Food and Drink, it owns
Cornetto, Knorr, Liptum, Magnum, Brooke Bond, Bru Instant, Cup A Soup and Fruttare
(Alssema et al. 2015). Under Home Care, it has Domestos, Surf, Comfort, Neutral, Persil and
Puro. The brands that fall under Personal Care are that of Axe, Dove, Lux, Vaseline, Signal,
Breeze and citra.
3. Business Unit Research
a)
Strategic Business Unit is also known as the SBU and it acts as a fully unit that has
direction. It operates like that of a separate unit and it comprises to be an important part of the
company. It reports directly to that of the headquarters within the organization regarding the
status of operation of the business. There are three strategic business units within the
corporation like Food and Drink, Home Care and that of Personal Care. The brands of
Unilever that caters to the need of Food and Drink are hugely popular among a large segment
of consumers across different countries. The most popular brands are that of Becel, Cornetto
and Brooke Bond (Cross et al. 2017). Becel spread is made out of natural seed oils and it
contains Omega 3 along with Omega 6 essential fat. It can help in the process of reducing the

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saturated fat intake with that of every meal. Cornetto consists of delicious wafer that is coated
with a chocolate layer and this is combined with ice cream.
b)
Product Line refers to related products under that of a single brand that is sold by the
same company. The companies sell different product lines under the name of different brands
(Kafetzopoulos and Gotzamani 2014). The companies expand the offerings by the help of
addition to that of the existing product line. The heart-shaped logo of Heart brand can be
found on some of the favourite ice creams of the world like that of Magnum, Cornetto and
Vienetta. Amora offers a variety of food products that is inclusive of mustard, ketchup and
that of pickles (Laursen and Andersen 2016). The customers like to buy products from the
brands that they have tried before and are familiar with. Buying from the same brand can
provide them with the feeling of reliability and the customers feel safe to try out a new
product.
4. Business Unit Revenue
a)
Revenue refers to the income that a company makes from its business activities. It
generally comes from the sale of that of goods along with services to that of the customer.
The other terms that are synonymous with revenue is that of “sales” and that of “ turnover”
(Davis et al. 2018). The revenue turnover of Unilever was 10, 008 in the year 2016 and it
was 10, 120 in the year 2015 (Jurietti, Mandelli and Fudurić 2017).

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2016 2015
Figure: Revenue from Food and Drink
Source: (Unilever.com 2018)
Unilever has made great progress in the sector of manufacturing that has helped it to avoid
costs of around 700m euro. It has helped Unilever in making huge amount of profit in the
business unit of “Food and Drink”. The Vegan Hellmann’s mayonnaise of Unilever is the
main draw among the consumers and it has helped Unilever in earning profit to the maximum
extent. The Ben and Jerry ice cream that is non-diary can help in meeting the demands of the
consumer who look for plant-based alternative (Goddard 2018). Flora Freedom that is a daily
free spread proves to be good in reducing the emission of that of the green house gases.
3. External Environment Analysis
a)
The operating environment of an organization is indicative of the entities, conditions
along with events that influence the activities of an organization. It helps in determining the
choices made by an organization and suggests the opportunities along with threats of the

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company. Understanding the external environment can help the company in the process of
evaluation of the internal resources and assess the capabilities of the organization.
Political Factors is indicative of the degree to which the government interferes in the
economy. This is inclusive of the government policy, tax policy, environmental law and that
of trade restrictions. The economic factors include that of economic growth, exchange rate
and that of inflation of the operating environment (Ritzer 2017). The socio-cultural factors
refer to the shared belief along with attitudes of that of the population. Population growth and
health consciousness are the factors that have an influence on the performance of an
organization (Rothaermel 2015). The technological landscape is changing at a rapid pace and
this affects the way products are marketed to that of the consumers. Scarcity in relation to the
raw materials along with that of the carbon footprint target are the major determinants that
help in determining whether the company will be sustainable in the prevailing market. Legal
factors include that of the advertising standards and the rights of the consumer (Chkanikova
and Mont 2015). It is imperative for a global organization to abide by the legal framework.
Unilever has to abide by the regulatory restrictions that are pronounced by that of
European Commission. Unilever has also to abide by the Food and Drug Administration and
on the occasion of Unilever failing to comply they would have to face fines and legal issues
(Bocken et al. 2014). Unilever has also to be liable to the regional laws within Europe. The
cheaper goods are in great demand in the present age. There are many companies in France
that are competing against Unilever. The international competitors of Unilever are that of
Nestle along with that of Procter & Gamble. Local competition is faced by the company due
to companies like that of Beiersdorf, Danone and that of Henkel (Peteraf, Gamble and
Thompson 2014). The products of Unilever focus on the aspect of well-being that is the
primary aim of the modern day consumer. Unilever emphasizes on developing the digital
marketing strategy and the high automation level makes it popular among the consumers. It

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makes use of technology more than that of the competitors. Legal factors help in binding
Unilever with that of the competitors. Unilever has to abide by health safety regulations in
order to survive in the market (Alssema et al. 2015). Environmental footprint is a great issue
of the modern age and it wants to half that of the environmental footprint in the course of the
next ten years and agricultural raw materials are being valued by the present age consumer.
6. Source of Sustainable Competitive Advantage
The four factors that are necessary for sustainable competitive advantage are that it
should be asset-driven, difficult to be imitated, branding and it should be sustainable in the
present market. Efficient working of the internal operations and being cost effective can help
a company in being asset-driven (Atkins and Bowler 2016). Advanced equipment along with
investment in the sector of advertising can help a company in staying ahead of that of their
competitors. Creation of favourable associations can help in building the brand reputation of
the company. The value that customers get from the brand should be lasting that can help it to
gain long-term success. The Unilever Sustainable Living Plan (USLP) can bring changes
across that of the value chain (Ortiz‐de‐Mandojana and Bansal 2016). Research has
highlighted that customers want to purchase brands that can lead to environmental good.
Unilever has been successful in developing 18 sustainable living brands that includes that of
Dove, Lipton and that of Hellmann. Nutrition Enhancement Program was launched that aims
at reducing the level of salt along with sugar across their portfolio (Hillary 2017). They have
been successful in eliminating trans fats from that of partially hydrogenated vegetable oil
(Dyllick and Muff 2016). Unilever was instrumental in launching vegan Hellmann
Mayonnaise within the United States. Spaghetti Bolognese contains natural ingredients and it
has won the Germany Eat Healthy Award in the year 2015. Unilever has also partnered with
European Vegetarian Union in the year 2017 (Verdouw et al. 2016).

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Nutrition labelling on the products of Unilever helps in explaining to the consumers how the
products can fit into that of a healthy diet. The pop-up Becel bar was launched in Netherlands
in the year 2015 and the Becel made use of sunflower and that of rapeseed oil in order to
make natural products (Beske, Land and Seuring 2014). Unilever has also worked with
Health Authority in Dubai that has promoted the drinking of tea that is good for the health.
7. Strategic Direction
Strategic Direction refers to the action course that can help a company in achieving
the golas pertaining to the strategy. It is inclusive of the central forces that can help a business
in moving in the forward direction so that it can attain the objectives (Prajogo 2016). It is an
important facet of a business. It can establish the structure in relation to internal
responsibilities on which a department depends.
Unilever can make use of diversification as a growth strategy for the future. It can
establish new business in order to grow the company. Acquisition of the food and drink
business of a competitor or a brand that is already popular can help the company in its
strategic direction and bring profit for the company (Peteraf, Gamble and Thompson 2014). It
can help Unilever in strengthening its reach within the industry of consumer goods.
8. Conclusion:
The main divisions of that of Unilever are that of food and drink, home care along
with that of the personal care. The products of Unilever are made of natural seed oil and such
ingredients that can benefit the health of the consumer. The food and drink products of
Unilever can help in the process of reduction of that of the saturated fat intake. The
customised healthy products of Unilever have helped it in gaining popularity among the
consumers. The ice creams are made up of non-dairy ingredients that can serve the health of

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the customer. Unilever has produced 18 brands that are sustainable and greatly coveted
among the customers. The Nutrition Enhancement Program can reduce the intake of salt and
sugar among the consumers.

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References:
Alssema, M., Boers, H.M., Ceriello, A., Kilpatrick, E.S., Mela, D.J., Priebe, M.G.,
Schrauwen, P., Wolffenbuttel, B.H. and Pfeiffer, A.F., 2015. Diet and glycaemia: the markers
and their meaning. A report of the Unilever Nutrition Workshop. British Journal of
Nutrition, 113(2), pp.239-248.
Atkins, P. and Bowler, I., 2016. Food in society: economy, culture, geography. Routledge.
Beske, P., Land, A. and Seuring, S., 2014. Sustainable supply chain management practices
and dynamic capabilities in the food industry: A critical analysis of the
literature. International Journal of Production Economics, 152, pp.131-143.
Bocken, N.M., Short, S.W., Rana, P. and Evans, S., 2014. A literature and practice review to
develop sustainable business model archetypes. Journal of cleaner production, 65, pp.42-56.
Chkanikova, O. and Mont, O., 2015. Corporate supply chain responsibility: drivers and
barriers for sustainable food retailing. Corporate Social Responsibility and Environmental
Management, 22(2), pp.65-82.
Cross, G., Vanhaverbeke, W., Roijakkers, N. and Pop, O., 2017. How Unilever Realises Its
Mission Of Making Sustainable Living Commonplace Through Partnering.
Davis, B., Lockwood, A., Alcott, P. and Pantelidis, I.S., 2018. Food and beverage
management. Routledge.
Dyllick, T. and Muff, K., 2016. Clarifying the meaning of sustainable business: Introducing a
typology from business-as-usual to true business sustainability. Organization &
Environment, 29(2), pp.156-174.
Goddard, E.D., 2018. Interactions of surfactants with polymers and proteins. CRC press.