VIETNAM NATIONAL UNIVERSITY, HANOI

International School

GLOBAL SUPPLY CHAIN MANAGEMENT

FINAL REPORT
UNILEVER COMPANY

Subject code: INS3021 01

Lecturer: PhD. Ho Nguyen Nhu Y

GROUP 3

Lương Công Khánh Duy 20071014

Ngô Kim Oanh 20070296

Nguyễn Thu Trang 20070367

Nguyễn Quang Tuấn 20071053

Đỗ Hà Vy 20070386

Ha Noi, August 2023

 Table of Contents

I. Executive summary ................................................................................................ 1

II. Introduction Unilever’s profile.............................................................................. 1

1. Introduction ........................................................................................................... 1

2. Competitors ........................................................................................................... 2

3. Unilever's supply chain situation ........................................................................... 3

III. Unilever strategic priorities ................................................................................... 4

1. Order Winner ......................................................................................................... 4

2. Order Qualifier ...................................................................................................... 8

IV. Unilever’s supply chain design ............................................................................ 10

1. Supplier................................................................................................................ 10

2. Inbound logistics ................................................................................................. 12

3. Production............................................................................................................ 14

4. Outbound logistics ............................................................................................... 15

5. Distributors and Customers ................................................................................. 16

6. IT Design ............................................................................................................. 17

V. Unilever’s supply chain management ................................................................. 19

1. Inventory management ........................................................................................ 19

2. Relationship management ................................................................................... 19

3. Logistics management ......................................................................................... 20

4. Forecasting management ..................................................................................... 22

5. Global Supply Chain Management ..................................................................... 24

VI. Unilever’s lean management ............................................................................... 27

 1. Lean production ................................................................................................... 27

2. Total Quality Management .................................................................................. 29

3. Respect to People ................................................................................................ 31

VII. Unilever’s supply chain management issues and suggestions .......................... 32

1. Issues and suggestions in inventory management ............................................... 32

2. Issues and suggestions in supplier management.................................................. 35

VIII. Conclusion ........................................................................................................... 37

IX. References.............................................................................................................. 38

X. Contribution .......................................................................................................... 42
 I. Executive summary

Unilever's global supply chain management report provides a comprehensive analysis of

the company's practices, focusing on company profile, strategic priorities, supply chain
design, supply chain management, lean management, and issues and suggestions related
to inventory and supplier management.

Unilever, a global consumer goods company, is deeply committed to sustainability and

responsible business practices. The report highlights Unilever's efforts to integrate
sustainability throughout its supply chain, ensuring social and environmental
responsibility. It examines the strategic priorities of Unilever's supply chain management,
focusing on growth, digital transformation, operational efficiency, and sustainability.
Analysing deeply Unilever's supply chain design, emphasizing the integrated approach to
sourcing, manufacturing, and distribution, with a specific focus on inventory and supplier
management. It explores the company's adoption of digital technologies, advanced
analytics, and lean management principles to optimize inventory levels, improve supplier
collaboration, and enhance overall efficiency in supply chain management. Lastly, the
report addresses identified issues in inventory and supplier management, and provides
suggestions for improvement, including the use of real-time demand sensing tools,
strengthening supplier relationships, and implementing advanced inventory management
techniques.

II. Introduction Unilever’s profile

1. Introduction

Unilever, a British multinational consumer packaged goods company, was established on

2 September 1929 as a result of the union of Dutch margarine producer Margarine Unie
and British soap maker Lever Brothers and. The company's current headquarters are in
London.

Baby food, cosmetics, bottled water, breakfast cereals, cleaning supplies, condiments,
energy drinks, toiletries, ice cream, instant coffee, and other goods are all available from
Unilever. Notably, Unilever holds the distinction of being the largest producer of soap
worldwide, with its products widely available in more than 190 countries.

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Mission: Unilever's mission is centered around meeting the daily needs for nutrition,
hygiene, and personal care through brands that enhance people's well-being and enrich
their lives. This comprehensive mission statement outlines the consumer goods
company's functions and objectives in fulfilling its purpose. Unilever's mission
encompasses the following key aspects:

● Providing essential products for everyday use.

● Addressing various facets of consumers' lives.
● Positively affecting people's quality of life.

Vision: In line with its mission, Unilever's vision is set on becoming a global leader in
sustainable business. The company aims to showcase how its purpose-driven and future-
oriented business model leads to exceptional performance, consistently yielding financial
outcomes that rank in the upper echelons of its industry. The core elements of Unilever's
visionary statement include:

● Attaining a position of leadership in the realm of sustainability.

● Embracing a purpose-driven and future-ready business approach.
● Achieving superior business performance that consistently outperforms industry
benchmarks.

2. Competitors

Unilever competitors consist of GSK, Johnson & Johnson, Nestle USA, Mars and Procter
& Gamble. In terms of product quality score when compared to its rivals, Unilever comes
in first.

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 3. Unilever's supply chain situation

Unilever's supply chain covers spend categories like raw materials, packaging, and more.
They've invested €43.2 billion for sourcing, manufacturing, and logistics. With 52,000
suppliers globally, Unilever ensures a diverse range of goods and services. Operating
across regions like Europe, North America, and beyond, Unilever's reach spans 150
countries. Logistics span 106 countries, effectively delivering products. Marketing
extends to 144 countries, reflecting a customer-focused approach. Collaboration with
suppliers in 69 and 92 countries mitigates risks. In 82 countries, Unilever's sustainable
packaging efforts shine. This global presence showcases adaptability, from regulations to
culture. Unilever's precise dance ensures product availability, local engagement, and
community impact.

Basic flowchart of Unilever

Unilever's vast network spans 52,000 suppliers across 150 countries, showcasing its
global reach. Beginning with strategic collaboration, Unilever shares quality and
sustainability goals, fostering new partnerships. Investing €1.1 billion in 2020, Unilever
prioritizes innovation, enhancing products and processes. Partnering with 69, 92, and 82
countries for contract manufacturing, raw materials, and packaging respectively ensures
a diverse, sustainable supply. Logistics are managed across 106 countries, efficiently
delivering products. Marketing and sales strategies in 144 countries build brand
awareness. Unilever's responsive approach relies on market feedback, understanding
customers. The collaborative loop signifies continuity in relationships, securing an agile
supply chain.

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III. Unilever strategic priorities

1. Order Winner

❖ Brand equity

Unilever possesses a robust and enduring brand portfolio that has earned the trust and
loyalty of consumers over the course of several decades. The company has been on a
trajectory of evolution, transitioning from its historical focus on oil production to a more
expansive global market presence. Throughout its 25-year journey of growth and
evolution, Unilever has strategically acquired numerous renowned enterprises, such as
Dove, Omo, Knorr, Lipton, Lux, Magnum, Rexona/ Degree, and Sunsilk. This series of
acquisitions has propelled Unilever's brand count beyond 400 and enabled its products to
reach consumers in 190 countries, generating a substantial annual turnover of 50 billion
Euro.
High brand equity helps Unilever build customer loyalty and strengthen their trust in the
company's products. Currently Unilever is holding the 56th position for the Companies
most appreciated by customers in the Forbes list. With an estimated 150 million people
using Unilever products two billion times a day, Unilever has reached its highest level of
success because it understands the real problems people face. It is also ranked at number
7 for Europe's most valuable company. This means that they can maintain and increase
market share in different categories.Unilever boasts a robust brand portfolio, with a
longstanding market presence and growing global expansion beyond its traditional oil
production. Over the past 25 years, Unilever has diversified its operations and made
strategic acquisitions, including renowned brands like Dove, Omo, Knorr, Lipton, Lux,
Magnum, Rexona/ Degree, and Sunsilk. With over 400 brands and a footprint in 190
countries, Unilever achieves a substantial turnover of 50 billion Euro.
The company's strong brand equity fosters customer loyalty and bolsters trust in its
products. Unilever ranks 56th among the most esteemed companies by customers
according to Forbes. Serving an estimated 150 million people who use Unilever products
two billion times daily, the company's success is attributed to its deep understanding of
people's real challenges. Furthermore, Unilever stands at the 7th spot among Europe's
most valuable companies, reflecting its ability to maintain and expand market share across
diverse categories..

❖ Innovation

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Unilever consistently invests in research and development to create new and improved
products. They focus on enhancing the quality, functionality, and sustainability of their
offerings.

● Leveraging Technology:

At the core of Unilever's innovation ethos lies a profound integration of technology,

propelling the company towards breakthroughs and the realization of its strategic
objectives. A pivotal facet of their innovative approach involves seamlessly weaving
automated technology into their innovation hubs. Notably, Unilever's UK Materials
Innovation Plant (MIF) stands as an exemplar in this realm, boasting an unparalleled
concentration of materials chemistry robots on a global scale. This state-of-the-art
technological infrastructure equips Unilever with the capacity to amass and process data
at a rate tenfold faster than conventional methodologies, thereby dramatically expediting
their innovation endeavors.

Through the adept utilization of automated technology, Unilever orchestrates virtual

experiments and simulations, refining product development strategies even before they
progress to the physical laboratory phase. This dynamic methodology translates into
accelerated innovation cycles, effectively shortening the timeline from concept to market
introduction. Remarkably, Unilever accomplishes a remarkable tally of approximately
12,000 rapid product tests annually, a testament to their agility in staying at the forefront
of industry dynamics and promptly catering to the evolving preferences of discerning
consumers.

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 ● Exploring Biological Frontiers:

Unilever's commitment to innovation extends deeply into the realm of biology, a

commitment born out of its recognition of the potential benefits it holds in achieving
critical climate and nature objectives. The company has distinguished itself as a global
frontrunner in microbiome research, boasting a repository of more than 100 patents
exclusively in this field. Through a systematic exploration of the profound impacts that
the microbiome exerts on diverse facets of health and well-being, Unilever is resolutely
dedicated to forging products that wield a positive influence on the daily lives of
consumers. This resounding pursuit is buoyed by world-class research facilities,
illustrious scientists, and an ethos steeped in scientific excellence and technological
innovation, all of which collectively magnetize premier talent and yield groundbreaking
advancements that shape both products and processes.
Unilever's innovation drive extends further to encompass a profound understanding of the
skin care domain. An emblematic illustration of this is their pioneering work on pro-lipid
technology, ingeniously engineered to bolster the skin's intrinsic capacity to repair its
protective barrier from within. This innovation serves as a vivid testament to Unilever's
unwavering commitment to elevating the consumer experience and furnishing efficacious
solutions that precisely address the intricate demands of skin care.

❖ Sustainability

Unilever's Sustainability Plan (USLP), launched in 2010, serves as a blueprint for

achieving sustainable growth in the face of uncertainty. It outlines the company's
commitment to environmental and social responsibility.. It drives profitability, brand
benefits, cost savings, and innovation. USLP spans Unilever's entire portfolio, markets,
and value chain, focusing on three goals by 2020:

Improving Health and Well-being: Health & Hygiene and Nutrition:

In Vietnam, Unilever's business shows good alignment in this regard. Its purposeful
brands are growing impressively, aiming to make a positive impact on people, the
environment and society without compromising product quality and value. All of this has
a positive impact on Vietnamese people. Unilever Vietnam's Personal Care segment leads
its industry peers in improving hygiene standards. Take Lifebuoy as an example; it
provides handwashing education to 35 million people. P/S provides oral care education

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to 25 million children. This means more and more people are washing their hands and
brushing their teeth for personal hygiene, which drives the market for hand soap and
toothpaste

Reducing Environmental Impact: Greenhouse Gases, Water, Waste & Packaging,

Sustainable Sourcing:

Unilever's business strategy is centered on sustainability, focusing on personal health and

the planet's well-being. Climate action, from emissions reduction to plastic recycling, is
core to this approach. With a global portfolio of 400 brands including Dove, Seventh
Generation, and Vaseline, Unilever recognizes the urgency of sustainability in the face of
climate change.

The company aims to cut the use of virgin plastic by 50% by 2025, with brands like Dove
and Seventh Generation already using 100% recycled plastic in most packaging. Unilever
is committed to collecting and treating more plastic waste than it uses for packaging by
2030, alongside planting one million trees by 2025 for carbon positivity and striving for
a net-zero value chain by 2039.

In North America, Unilever invested $15 million in the Closed Loop Partner Leadership
Fund to recycle around 60,000 tons of plastic packaging waste annually by 2025. This
underscores Unilever's resolute dedication to driving tangible sustainability impact and
fostering a greener future..

Enhancing Livelihoods: Equity in the Workplace, Opportunities for Women, Inclusive

Business:

In 2017, Unilever revitalized its Responsible Sourcing Policy, fortifying the approach to
amplify supplier participation. Presently, approximately 55% of procurement
expenditures involve suppliers aligning with mandatory Policy requisites, with a
determined aim of reaching 100% compliance by 2020. Unilever champions the belief
that women's empowerment stands as the paramount catalyst for human development and
economic progress. A stride toward gender equilibrium is evidenced by the elevation of
women managers from 46% in 2016 to 47% by the close of 2017.

The Unilever Sustainable Living Plan (USLP), initiated in 2010, embodies an

unequivocal commitment to sustainability and social responsibility. By weaving this

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framework into the brand's fabric, Unilever cultivates a positive reputation, lures patrons,
and fosters unwavering consumer trust. As a discerning clientele increasingly inclines
towards eco-conscious and socially engaged enterprises, Unilever's resonance with this
inclination precipitates a surge in consumer preference for its products and services.

Unilever's holistic dedication to sustainability concurrently cultivates a constructive

brand image while charting a competitive edge. As consumer preferences gravitate
towards eco-friendly and socially responsible offerings, Unilever's strategic alignment
with this shift translates into a burgeoning customer base that places premium emphasis
on prudent consumption and ethical considerations. Through the USLP, Unilever forges
a path of sustainable growth that not only enriches its profitability but also resonates
profoundly with the ethos of brand value, cost-efficiency, and pioneering innovation. This
blueprint encompasses Unilever's complete portfolio, markets, and value chain,
steadfastly pursuing three formidable objectives set to materialize by 2020.

2. Order Qualifier

❖ Product

Unilever upholds rigorous product quality assessments, guided by stringent benchmarks

tailored for each product category. Comprehensive evaluations encompass ingredient
analysis, formulation, efficacy, and safety considerations. This meticulous scrutiny
extends through the entire production process, encompassing recurrent quality checks

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encompassing physical, chemical, and biological testing to assure product attributes and
safety. Immediate corrective actions are taken should any quality discrepancies arise.

While adhering to international standards, Unilever tailors its product offerings to align
with the distinct preferences of Vietnamese consumers. Notably, the company has
enriched its portfolio by acquiring established Vietnamese brands such as Viso washing
powder and P/S toothpaste. These acquisitions were followed by enhancements in
packaging and marketing to amplify brand consumption.

Unilever's astute adaptation to local preferences extends further, as demonstrated by their

strategy to "Vietnamize" products. An illustrative success story is the infusion of locust
extract into Sunsilk shampoo, a familiar ingredient to Vietnamese consumers. This
localized approach has yielded resounding success, with the "Vietnamized" Sunsilk
variant accounting for an impressive 80% of the brand's shampoo sales.

Elevating quality and safety to paramount importance, Unilever continuously refines its
standards, ensuring that the products it offers align seamlessly with consumer needs. This
steadfast commitment to unwavering quality cultivates robust consumer trust and a
market presence fortified by high-caliber offerings that cater effectively to local
preferences..

❖ Cost

Unilever Corporation has implemented a flexible pricing strategy, allowing for

adjustments in response to market fluctuations and consumer demands. Recognizing that
80% of consumers in Vietnam are contending with limited incomes, Unilever Vietnam
has developed a pricing approach tailored to accommodate their financial circumstances.

This strategy involves collaborating with local small businesses to source raw materials
domestically, thereby reducing production costs and minimizing tariff expenses. As an
example, when P&G reduced prices by 20% for their Tide detergent, Unilever swiftly
followed suit by reducing the selling price of their 1/2 kg washing powder from 7,500
VND to 5,500 VND.

Unilever optimizes distribution efficiency by dispersing production and packaging

operations across the Northern, Central, and Southern regions, effectively reducing
transportation and warehousing costs.

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 Furthermore, Unilever extends financial support to local enterprises, assisting them in
upgrading production equipment, facilitating technology transfers, and organizing
production training programs.

IV. Unilever’s supply chain design

1. Supplier

Unilever has established a global supplier network consisting of approximately 54,000

suppliers, allowing the company to source materials and products from multiple sources
at lower prices. This has resulted in allowing the company to remain competitive in the
industry. In addition, Unilever's supply chain strategy has enabled the company to reduce
its carbon footprint by using sustainable sources for its sourcing. This has helped the
company reduce its environmental impact and meet its environmental goals.
The following table summarizes Unilever's main suppliers in different regions of the
world:

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 Chart of the distribution of Unilever's suppliers

In Vietnam, Unilever is purchasing raw materials from Vinachem. On the basis of

competitive supply pricing and actual future demand, the two parties will jointly design
production and supply strategies. In addition to the need to purchase imported substitute
materials, Unilever will look for opportunities for Vinachem to export those key

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ingredients to other Unilever subsidiaries, initially focusing on LAB in ASEAN countries,
then Asia and finally globally.

2. Inbound logistics

Unilever implements a robust inbound logistics process to manage the flow of materials
and components from suppliers to its manufacturing facilities. Here is a general overview
of Unilever's inbound logistics:

Inbound logistics

● Supplier Management:

Unilever maintains relationships with a broad network of suppliers globally to ensure a

steady supply of materials and components. Suppliers are selected based on criteria such
as quality, reliability and compliance with standards.

● Demand Forecasting and Planning:

Unilever employs demand forecasting techniques to estimate the quantities of materials

required for production. Unilever's planning teams work closely with various
stakeholders to align supply with demand and optimize inventory levels.

● Procurement and Ordering:

Once the demand forecasts are established, Unilever's procurement teams initiate the
ordering process. Unilever may use electronic procurement systems or other digital
platforms to streamline the ordering process.

● Transportation and Delivery:

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Suppliers are responsible for arranging transportation to deliver the materials to
Unilever's manufacturing facilities. Unilever may also collaborate with third-party
logistics providers for efficient transportation management.

● Receiving and Quality Control:

The materials are inspected to ensure they meet Unilever's quality standards and match
the specifications stated in the purchase orders.

● Warehousing and Inventory Management:

Unilever employs various inventory management techniques, such as just-in-time (JIT)

or vendor-managed inventory (VMI), to optimize stock levels and ensure timely
availability of materials for production.

● Production Planning and Scheduling:

Unilever's production teams use advanced planning systems to create production

schedules based on demand forecasts, available inventory, and production capacity.

● Production and Assembly:

The materials are transformed into finished goods through various manufacturing and
assembly operations. Unilever emphasizes operational excellence and continuous
improvement to enhance productivity and product quality.

● Internal Distribution:

After production, Unilever's internal distribution network manages the movement of

finished goods from manufacturing facilities to warehouses or distribution centers.

● Order Fulfillment:

Unilever's distribution centers pick, pack, and dispatch products based on customer orders
received from various channels, including retailers, wholesalers, and e-commerce
platforms.

By implementing a well-structured inbound logistics process, Unilever aims to ensure a

reliable supply of materials, optimize production efficiency, maintain product quality
standards, and delivery.

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 3. Production

Research and development, raw material sourcing, manufacturing, quality control, and
packaging are some of the stages that make up the company's production process.

● Research and Development

Unilever makes research and development investments to provide cutting-edge goods that
satisfy shifting consumer demand. The company's R&D efforts are focused on developing
products that are sustainable, environmentally friendly, and meet the highest quality
standards.
● Sourcing of Raw Materials
Unilever sources raw materials from around the world. The company is committed to
sourcing raw materials in a sustainable and responsible manner, and has established
programs to promote ethical practices in its supply chain.
● Manufacturing
Unilever has a network of manufacturing facilities around the world, where it produces
its products. Unilever uses advanced technologies and automation to optimize its
manufacturing processes and improve efficiency.
● Quality Control
Unilever has a rigorous quality control process to ensure that its products meet the highest
standards of quality and safety. The company conducts extensive testing of its products
at each stage of the production process to ensure that they meet regulatory requirements
and consumer expectations.
● Packaging
Unilever uses a variety of packaging materials, including plastic, glass, and paper, to
package its products. Unilever is committed to reducing the environmental impact of its
packaging and has established ambitious targets to increase the use of recycled materials
and reduce waste.

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 4. Outbound logistics

The company's outbound logistics process is designed to efficiently transport its products
from its manufacturing facilities to its customers, which include retailers, distributors, and
direct-to-consumer channels.

● Distribution centers

Unilever's outbound logistics process begins at its manufacturing facilities, which are
located around the world. The company uses a network of regional distribution centers to
manage its inventory and fulfill orders. These distribution centers are strategically located
to ensure that products can be quickly and efficiently transported to their final destination.

● Transportation

Once the products are manufactured and packaged, they are transported to the distribution
centers using a variety of transportation modes, including trucks, trains, ships, and
airplanes.

● Shipment

At the distribution centers, the products are sorted and packaged for shipment to
customers based on their location and order requirements.

● E-commerce

Unilever also has a robust e-commerce platform that allows customers to purchase
products online and have them shipped directly to their homes. The company offers a
variety of shipping options, including standard, express, and same-day delivery,
depending on the customer's location and the urgency of the order.

● Technology

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In addition to its physical logistics infrastructure, Unilever also uses technology to
optimize its outbound logistics process. The company uses data analytics and machine
learning to forecast demand, optimize inventory levels, and route shipments more
efficiently.

Unilever's outbound logistics process is designed to be efficient, cost-effective, and

flexible, allowing the company to quickly adapt to changing market conditions and
customer demand while maintaining a high level of service.

5. Distributors and Customers

❖ Distributors

Unilever works with a variety of distributors around the world to ensure its products reach
consumers in a timely and efficient manner. Unilever's network of distributors includes
both large and small companies that are responsible for getting its products into retail
stores, supermarkets, and other outlets.
Some of the major distributors that Unilever works with include:
● Acosta: Acosta is a leading consumer goods distributor in the United States,
partnering with Unilever to distribute Unilever's food, beverage, cleaning and
personal care products to retailers and supermarkets across the United States.
● DHL Supply Chain: DHL provides warehousing and distribution of Unilever
products in many regions around the world, providing transportation and
warehousing solutions to ensure products are delivered on time and to their
destination.
● CJ Logistics: CJ Logistics is one of the leading distributors in Asia and works with
Unilever to distribute their products to consumers in Asian markets such as Korea,
China and Vietnam.
● Kerry Logistics: Kerry Logistics is a leading distributor in Asia, partnering with
Unilever to distribute their products to consumers in Asian markets such as China,
India and Southeast Asia.
● XPO Logistics: XPO Logistics is one of the world's leading shipping companies,
partnering with Unilever to provide transportation and warehousing solutions to
ensure products are delivered on time and to their destination.
Unilever also works with many smaller distributors in local markets around the world to
ensure its products are available to consumers in local communities. In Vietnam, Unilever

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has a widespread distribution network made up of 150 distributors and 200,000 retail
locations. More than 1,500 people are employed directly by the company, and more than
10,000 more employment are indirectly created through partners including outsourcing
units, contractors, distributors, and small and medium-sized businesses across Vietnam.
❖ Customers
Unilever products are used by millions of customers worldwide. Customers are the final
objects in the hard supply chain, they are the ones who will consume the goods. Unilever
offers a variety of brands,. different brands cater to different customer segments,
demographics and interests, allowing Unilever to reach a diverse customer base.
● Customer segment
Unilever's customers can be divided into different categories in terms of age, salary range
and what Unilever can offer them. Unilever's customers are of all ages: the individual and
family segments are 14-50 years old and have middle to high incomes; Unilever's target
segment is health and beauty conscious people; for the age of food preferences starting
from 5 years old and the trend towards delicious and nutritious food.
● Target customer
The target audience of many products of Unilever Vietnam is young people, who today
are somewhat more independent, liberal and confident than previous generations. Due to
the country's young population structure and the widespread extended family model
(which includes grandparents, aunts, uncles, etc.), Unilever has a lot of business potential
in Vietnam.
● Innovation
Unilever has shortened delivery times and enhanced its ability to meet customer needs by
using its global supply network. In addition, Unilever's supply chain strategy has allowed
the company to reduce the risk of running out of stock as it can ensure that its products
are always available to customers. This satisfies most of Unilever's customer segments.

6. IT Design

Unilever has a complex and global supply chain that encompasses a wide range of
activities, from product design and manufacturing to distribution and retailing. To manage
this supply chain effectively, Unilever has designed an IT architecture that integrates
several key systems and processes.
● Enterprise Resource Planning (ERP)

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This is enterprise resource planning software that allows access to shared internal data to
manage company activities. Beginning with SAP CO-PAAccelerator, Material Ledger
(ML), and other financial reporting accelerators, Unilever originally used SAP HANA to
speed up some of its important SAP ERP applications. Realizing the success of SAP
HANA, Unilever has comprehensively applied SAP S4 HANA to its main ERP software.
● Business Intelligence (BI)
To solve the problem of managing shared data (Master data) and data cleaning for
analysis, the Master Data Management system is deployed with Business Intelligence
(BI). BI helps Unilever track the health of a brand from the most general (global) level to
the most detailed (regional, regional, domain). Since BI, the financial statements of
companies are all automated, saving time and human resources.
● IoT & AI
Unilever has realized its goal of digitizing the entire production and supply chain. All
operations on the same platform are connected by the Internet of Things (IoT) system,
artificial intelligence (AI), and super apps. Unilever's factories do not stop at automating
production lines, but also quickly move towards smart factory models and robotics.
● SMC
Unilever designed SCM software to manage its supply chain processes. The company
uses a demand planning tool to forecast customer demand, a production planning tool to
optimize production schedules, and a transportation management system to manage
logistics operations. mine.
● Transport Management System (TMS)
Unilever chooses a managed transportation service service provided by Lean Logistics,
used to manage the movement of goods from production facilities to distribution centers
and Retailers. TMS is designed to optimize shipping routes and reduce costs, while
ensuring on-time delivery of products.
● Electronic Data Interchange (EDI)
The main tool used to strengthen relationships in the supply chain. Unilever was one of
the first companies that decided to use electronic documents to facilitate cooperation with
the retail chain. The group used various types of documents, such as Order, Ordrsp,
Desadv, Iconic, Insdes, Ostrpt, Recadv and ProDat

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V. Unilever’s supply chain management

1. Inventory management

Unilever is one of the leading companies in the manufacturing of consumer goods in the
world, so inventory management is crucial to ensure that the company has enough stock
to meet customer demand while reducing cost , minimizing inventory-related costs.

● Strategies

Unilever uses a variety of strategies to manage inventory effectively. One of the

company's most important strategies is demand forecasting, which involves using
historical data, market trends, and other factors to predict future demand for its products.
This helps the company plan production and manage inventory more accurately.

Unilever also uses a JIT (just-in-time) inventory management strategy. JIT helps reduce
the amount of inventory a company needs to hold, while reducing the risk of shortages
and reducing costs associated with inventory management.

● Technology

Unilever applies technologies for inventory management, including the use of RFID
(radio-frequency identification) technology to track product movement throughout the
supply chain. This improves the accuracy of inventory management and reduces the risk
of shortages or over-stocking.

Unilever also uses the Terra technology to optimize inventory and low cost inventory.
Terra Technology pioneered the use of retailer data in supply chain optimization, service
enhancement, inventory reduction, and waste reduction strategies.

2. Relationship management

Relationship management is a critical aspect of Unilever's business, the cost of

relationship management for Unilever can be significant, as the company operates in a
complex and global supply chain involving various stakeholders, such as suppliers,
customers, distributors, and retailers so it needs to invest in various activities and
initiatives to build and maintain positive relationships with its stakeholders.

● Supplier relationship

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The company works closely with its suppliers to ensure that they meet its standards for
quality, sustainability, and ethical practices. Furthermore, Unilever collaborates with its
suppliers to identify opportunities for innovation and improvement in the supply chain.

● Customer relationship

Unilever also places a strong emphasis on building and maintaining relationships with its
customers. The company engages in market research and consumer insights to understand
their needs and preferences, and develops products and marketing campaigns that are
tailored to their needs. Unilever also values feedback from its customers and uses it to
improve its products and services.

● Distributor relationship

In addition, Unilever works closely with its distributors and retailers to ensure that its
products are effectively marketed and distributed. The company provides training and
support to its partners to help them understand its products and the values that the
company stands for.

3. Logistics management

Unilever has a complex logistics management to ensure the efficient movement of goods
across its supply chain. Here are some key aspects of Unilever's logistics management:

● Global network:

Unilever operates an extensive global logistics network to support its operations across
multiple regions and countries. This network includes manufacturing facilities,
distribution centers, and warehouses strategically located to ensure proximity to markets
and reduce transportation costs. Unilever's global logistics network has installed the
Oracle Shipping Management Cloud along with several other key programs, such as
inventory management, enterprise resource planning and pricing systems to optimize its
logistics management processes. By utilizing Oracle Shipping Management Cloud,
Unilever can effectively manage order fulfillment, transportation planning, carrier
relationships, shipment execution, shipment tracking, and visibility. Additionally, the
integration with other systems and the analytics and reporting capabilities offered by
Oracle Shipping Management Cloud enable Unilever to enhance efficiency, improve
customer service, reduce costs, and gain better control and visibility over its supply chain.

20
 Oracle Shipping Management Cloud

● Transportation Optimization:

Unilever employs transportation optimization strategies to minimize costs and enhance

service levels. This includes selecting the most cost-effective transportation modes (road,
rail, air, or sea), optimizing routes, and consolidating shipments to maximize capacity
utilization. Leveraging technology solutions, such as transportation management systems
(TMS), Unilever improves visibility, reduces transportation costs, and enhances delivery
performance.

● Logistics collaboration:

Unilever collaborates with logistics service providers to optimize its logistics network.
Through collaborating, Unilever improves coordination, visibility, and information
sharing across the supply chain, leading to better inventory management and reduced lead
times.

● Technology and digitalization:

Unilever embraces technology and digitalization to enhance its logistics management

capabilities. This includes utilizing advanced analytics for demand forecasting and supply

21
chain optimization, implementing transportation management systems (TMS) or logistics
platforms for end-to-end visibility and process automation, and employing data analytics
and machine learning to optimize logistics operations and improve decision-making.

● Sustainability Initiatives

Unilever places a strong focus on sustainability in its logistics operations. This includes
implementing eco-friendly packaging, optimizing transportation routes to reduce
emissions, and exploring alternative fuels or energy sources. By integrating sustainability
into its logistics practices, Unilever demonstrates its commitment to environmental
responsibility.

4. Forecasting management

Unilever, a multinational corporation, uses a variety of methods and tools to forecast

sales. Specifically, Unilever forecasts the annual revenue using Market Trend Analysis,
Market Research, Modeling and Forecasting, Using Historical Data and using Advanced
Forecasting Techniques. The method used by Unilever to forecast sales may change over
time and depend on the company's strategy and methodology.

This is a chart of Unilever's growth trend by quarter over the years:

22
In this report, we will forecast sales for Unilever in 2023 by quarter. Specifically, for
forecasting results with less error and high accuracy, we use Trend-adjusted exponential
smoothing model and then do quarterly calculations using Seasonal Adjustment.

● The Trend-adjusted exponential smoothing pattern consists of 3 steps:

We apply α = +0.2 and β = +0.1 to calculate

Step 1: Smoothing the level of the series

St = αAt + (1 – α)(St-1+ Tt-1)

St = S2022 = 0.2*64325 + (1 - 0.2)*(60538 + 4635)

= 65003.4

Step 2: Smoothing the trend

Tt = β(St + St-1) + (1 – β)Tt-1

Tt = T2022 = 0.1*(65003.4 + 60538) + (1 - 0.1)*4635

= 4618.04

Step 3: Forecast including the trend

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FITt = St + Tt

FITt = FIT2023 = S2022 + T2022

= 65003.4 + 4618.04 = 69621.44

● The Seasonality Adjustment consists of 3 steps

Step 1: Compute average demand for each season

Step 2: Compute a seasonal index for each season

Step 3: Adjust the average forecast for next year by seasonal index

2022 2023
2021 (million Seasonal (million Seasonal Average (million
Quarter USD) index USD) index index USD)

Q1
15118 0,991 16386 1,038 1,015 17661,2614

Q2 15294 1,003 15518 0,983 0,993 17283,017

Q3 15435 1,012 14919 0,945 0,979 17033,144

Q4 15168 0,994 16303 1,033 1,014 17644,017

Total 61015 63126 69621,44

Average 15253,75 15781,5 17405,36

According to the way we use model Trend-adjusted exponential smoothing and

Seasonality Adjustment, Unilever's 2023 revenue is forecast at 69621.44 and an increase
of about 10.29% compared to 2022. This is consistent with the growth trend in Unilever's
revenue as shown in the chart.

5. Global Supply Chain Management

Unilever has a sophisticated Global Supply Chain Management system that includes plan,
source, make and deliver management. . The company carefully manages its supply
chains to ensure the availability of raw materials, the efficiency of manufacturing
processes, and the timely delivery of products to its customers.

24
 Unilever’s global supply chain structure

❖ Plan
● Demand planning: Forecast quantities through analyzing the global market,
customers and consumers demand, performing predictive analysis on historical
and current data in order to forecast future demand.
● Supply planning: After receiving the demand forecast of demand planning,
supply planning consolidates the data into feasible materials, production and
distribution plans.
❖ Source
● Raw materials: Unilever carefully sources raw materials from around the world.
These include agricultural commodities like palm oil, soybeans, tea…, chemicals
such as surfactants, fragrances, and preservatives…, packaging materials like
plastic, paper…, minerals and ores like talc and silica contribute to the personal
care and beauty product formulation. Unilever always ensures the ethical sourcing
of raw materials, reduces environmental impacts, and promotes biodiversity
within its supply chain.
● Suppliers: Unilever collaborates with a wide range of suppliers across its global
supply chain such as material suppliers, packaging suppliers, equipment and
machinery suppliers, logistics and transportation suppliers for the supply of raw

25
 materials, packaging, machinery and transportation of goods. In Vietnam,
Unilever has about 76 material suppliers, 54 packaging suppliers and is using
about 60% of raw materials and 100% of domestically produced packaging.
❖ Make

Manufacturing: Unilever has a network of manufacturing facilities that are strategically

located around the world to ensure efficient supply chains. Each factory will be
responsible for producing different product lines such as oral care products, food
products, personal care products, and liquid household cleaning products.

● Processing: Using production lines, labor and machines to transform raw

materials into products in a form suitable for packing and finishing. Unilever
highly invests in a lot of modern machines, technology to manage the entire
production process. Quality control measures are used to make sure the product is
consistent and meets Unilever standards.
● Packaging: After the products are manufactured, Unilever uses automatic
packaging machinery to pack them. Filling, sealing, and labeling the product are
all parts of this process. Unilever focuses on attractive and functional packaging
design, considering branding, product visibility, convenience, and sustainability.
Quality assurance checks are used to guarantee proper packaging, labeling
accuracy, and product integrity
❖ Deliver

The delivery ensures that the finished goods are delivered on schedule to Unilever's
partners and customers in the proper quantity and quality, as well as that they are satisfied
with the company's goods and services.

● Distribution management : Unilever has a global logistics network that includes

shipping, warehousing, and transportation operations. Distribution management
plays an important role in managing the movement of finished goods from the factory
all the way to the customers/consumers. After packaging, finished goods are stored
in the factory warehouse for a short time. Then they are delivered to Unilever major
distributors, retailers and customers. The company uses advanced technology and
data analytics to optimize its logistics operations and reduce the impact on the
environment.

26
 ● Customer service: acts as a line communication channel with customers and
especially consumers, ensuring that any issues with goods or services can be reported
back to the supply chain as soon as possible so that a fix can be implemented.

Unilever Vietnam also applies Unilever’s global supply chain structure in its supply chain:

Unilever Vietnam’s supply chain

VI. Unilever’s lean management

1. Lean production

Lean Production is a production management method that Unilever applies to improve

the company's operational efficiency through waste elimination and inventory
management.

● Waste Reduction and Efficient Operations:

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Unilever undertakes a comprehensive evaluation and enhancement of each facet within
its manufacturing process, driven by the pursuit of heightened efficiency and diminished
downtime and losses. The incorporation of cutting-edge technology and sophisticated
quality management methodologies serves as the bedrock for ensuring uniformity and
efficiency throughout production. This approach enables Unilever to effectively pinpoint
and eliminate superfluous and non-value-added elements inherent in the manufacturing
cycle. Employing established tools and methodologies like Kaizen for continuous
improvement, 5S encompassing sorting, cleaning, organizing, fixing, and compliance,
and a harmonized supply chain orchestration, Unilever diligently reduces waste while
optimizing efficiency.

Simultaneously, Unilever directs unwavering attention towards refining the

transportation and distribution facets of its operations, seamlessly aligning with waste
reduction objectives. By deploying streamlined shipping methodologies and precision-
tuned distribution systems, Unilever realizes a dual-fold benefit of reduced shipping costs
and transit times. This concerted effort ensures the precise delivery of products to the
right destinations at the right junctures, culminating in an ecosystem characterized by lean
operations and optimal resource utilization..

● Inventory Management:

Ordering and holding optimal inventory is the goal in this strategic decision area of
operations management. Unilever is interested in maintaining sufficient stocks of inputs
and consumables so that the business can respond to changes in the market. Just-in-time
(JIT) inventory management enables the achievement of operational inventory targets.
For example, the company's inventory size is sufficient to handle the sharp increase in
demand. Therefore, operations managers must determine the exact amount of raw
materials and consumables needed in Unilever's inventory. This amount should fully
support the company's productivity goals in its manufacturing and distribution activities.
Unilever uses perpetual and periodic inventory management.

Thanks to the application of Lean Production, Unilever has achieved many great benefits.
The company has reduced waste, enhanced production efficiency and product quality,
and optimized production resources and tools. This has helped Unilever maintain its
leading position in the industry and build a reputable and trustworthy image in the hearts
of customers..

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 2. Total Quality Management

Unilever employs three prominent methods for process enhancement: Total Productive
Maintenance (TPM) enhances machinery stability, Lean improves customer value
streams, and Six Sigma reduces process variation. Over time, companies often achieve
"world-class" status through a combination called World Class Manufacturing (WCM),
where TPM, Lean, and Six Sigma are simultaneously applied, with one method as the
foundation.

Unilever's WCM is a comprehensive approach infused into all production aspects,

merging Lean, Six Sigma, and TPM principles for operational excellence and value chain
optimization. TPM forms the WCM foundation, ensuring stable machinery performance.
Lean is integrated from the start to optimize processes, reducing waste and elevating
efficiency. Meanwhile, Six Sigma reduces variation and maintains product quality.

● Autonomous Maintenance:

Empowers operators on the shop floor to take responsibility for the upkeep and
maintenance of their equipment. By conducting routine inspections, operators can
identify potential issues early on and prevent breakdowns, leading to increased equipment
reliability and reduced downtime. This proactive approach not only improves efficiency
but also creates a sense of ownership and engagement among employees.

● Focused Improvement:

It involves continuous efforts to identify and implement improvements in all aspects of

the manufacturing process. Employees are encouraged to use problem-solving techniques
such as Root Cause Analysis (RCA) and Plan-Do-Check-Act (PDCA) cycles to eliminate
waste, increase productivity, and optimize resource utilization. The company's agility and
capacity to adjust to shifting market demands are maintained through this culture of
constant development.

● Planned Maintenance:

By developing proactive maintenance schedules, the company can minimize unplanned

downtime and disruptions. Regular maintenance activities, such as equipment inspections
and servicing, are carried out to keep machinery in optimal condition, thereby reducing
the risk of breakdowns and production delays.

29
 ● Quality Maintenance:

This is a cornerstone of Unilever's WCM, as it places a strong emphasis on adhering to

rigorous quality standards. By implementing quality control measures and standardized
work processes, Unilever ensures that its products consistently meet high-quality
specifications and customer expectations. This focus on quality not only boosts customer
satisfaction but also helps reduce waste and defects in the production process.

● Early Equipment Management:

By integrating best practices in equipment design and maintenance during the early stages
of project development, Unilever can enhance equipment reliability and longevity. This
proactive approach ensures that equipment is well-suited to meet production requirements
and is less prone to failures and breakdowns.

● Logistics and Supply Chain Management:

By streamlining the flow of materials, products, and information, the company reduces
lead times, optimizes inventory levels, and enhances overall supply chain efficiency. This
enables Unilever to respond quickly to market demands and deliver products to customers
more effectively.

● Safety, Health, and Environment (SHE):

As a fundamental aspect of its manufacturing operations. The company is committed to

ensuring the safety and well-being of its employees while minimizing its environmental
impact. Strict safety protocols are implemented, and sustainable practices are integrated
into production processes to create a safe and eco-friendly work environment.

Overall, Unilever's World Class Manufacturing is a comprehensive system that fosters a

culture of continuous improvement, operational excellence, and employee engagement.
By embracing WCM principles, Unilever has achieved remarkable results, including cost
savings, reduced waste, increased production capacity, improved quality, and enhanced
customer satisfaction. The company's dedication to WCM reinforces its position as a
global leader in the consumer goods industry, driving sustainable growth and delivering
value to consumers worldwide.

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 3. Respect to People

Unilever's lean management approach emphasizes "respect for people," which is a

fundamental principle in their business operations. This principle is derived from the
Toyota Production System, the foundation of lean management, and focuses on valuing
and empowering employees at all levels of the organization. Unilever recognizes that its
success is driven by its people, and fostering a culture of respect is essential to achieving
efficiency, innovation, and sustainable growth.

● Fostering Employee Engagement:

Unilever places a strong emphasis on creating a work environment that motivates and
engages its workforce. Through a series of thoughtfully designed initiatives, the company
encourages employees to actively participate in the feedback process. Regularly
scheduled meetings and discussion sessions provide platforms for open dialogues,
enabling employees to voice their opinions, share insights, and propose innovative ways
to enhance work processes. Going beyond traditional approaches, Unilever also employs
creative strategies such as idea contests and anonymous comment systems, cultivating an
atmosphere where employees feel empowered to contribute freely and authentically. A
testament to their commitment, Unilever conducted a comprehensive survey in 2020,
spanning across its global workforce of more than 150,000 employees, to gauge
satisfaction levels and gather valuable input.

● Nurturing Skills and Growth:

At the heart of Unilever's people-centric philosophy is a resolute commitment to

employee training and development. The company adopts a multifaceted approach,
offering an array of training programs that encompass both specialized skills tailored to
specific departments and broader soft skills and leadership development. Unilever's
dedication to growth extends beyond its internal programs, as the company actively
supports its employees in pursuing external educational opportunities through
scholarships and financial assistance. In the year 2020 alone, Unilever dedicated an
impressive tally of over 8 million hours to global employee training. These training
endeavors span a spectrum of domains, including honing professional expertise,
cultivating effective management and leadership skills, and facilitating personal
development.

31
 ● Prioritizing Safety and Well-being:

Unilever's commitment to its workforce extends into the realms of safety and health.
While ensuring adherence to rigorous occupational safety standards, the company goes
the extra mile by providing the necessary protective equipment to safeguard employees.
Moreover, Unilever extends its caring ethos to encompass comprehensive healthcare
coverage, insurance benefits, and proactive disease prevention assistance. In an endeavor
to promote employee well-being holistically, Unilever regularly organizes health-focused
activities ranging from exercise sessions to weight loss programs. Routine health check-
ups and extended healthcare benefits for employees and their families underscore the
company's dedication to safeguarding physical well-being.

The culmination of Unilever's multifaceted approach is the cultivation of a work

environment that is not only efficient and productive but also profoundly supportive and
enriching. This ethos of Lean management at Unilever underscores the notion that
operational excellence and a nurturing culture are mutually reinforcing. By valuing and
investing in its workforce, Unilever is not only driving business success but also
upholding its reputation as a trustworthy, attractive, and forward-looking employer.

VII. Unilever’s supply chain management issues and suggestions

1. Issues and suggestions in inventory management

Inventory management is a critical aspect of Unilever's supply chain operations, and there
are several issues that the company may face in this area. Here are some of the common
issues and suggestions for improving inventory management at Unilever:

* Overstocking: Unilever may face the issue of overstocking, leading to high inventory
carrying costs, increased warehousing requirements, and reduced cash flow.

Suggestions:

● Demand forecasting and planning: Improve demand forecasting accuracy to

better align production and inventory levels with customer demand. Utilize
historical data, market trends, and advanced analytics to forecast demand more
accurately and determine the optimal inventory levels for each product. .This can
help reduce overstocking and minimize inventory carrying costs, while ensuring
that the company has enough inventory to meet customer demand.

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 ❖ Implement just-in-time (JIT) inventory management: Adopt a JIT approach to
inventory management, where products are produced and delivered as closely as
possible to the actual demand. This can help minimize overstocking and reduce
carrying costs.
● Offer promotions and incentives: Develop promotional programs to stimulate
demand for products that are experiencing overstock. Offer discounts, bundle
deals, or other incentives to encourage customers to purchase excess inventory.

* Stockouts: Unilever may also face the issue of stockouts, leading to lost sales, lower
customer satisfaction, and reputational damage. This can occur if Unilever underestimates
demand or if there are supply chain disruptions.

Suggestions:

● Demand forecasting and planning: Implement a demand planning system that

uses data analytics, a real-time inventory tracking system, market research, and
collaboration with retailers to understand demand patterns and forecast customer
demand accurately. This can help ensure that the company has enough inventory
to meet customer demand and avoid stockouts.
● Safety stock and buffer inventory: Unilever can implement a safety stock strategy
to ensure that it has enough buffer inventory to handle unexpected demand spikes.
● Replenishment and order fulfillment processes: Implement efficient order
management and fulfillment processes to ensure timely replenishment of
inventory. Utilize automated systems for order processing, prioritize high-demand
products, and establish clear communication channels with distributors and
retailers.
● Customer communication and expectation management: Proactively
communicate with customers about product availability, potential stockouts, and
estimated restocking timelines. Set realistic expectations and offer alternative
products or solutions when stockouts occur.

*Obsolescence: Unilever may face the issue of inventory obsolescence, where products
become outdated or expire before they can be sold. This can occur if Unilever orders too
much inventory or if demand for a particular product decreases.

Suggestions:

33
 ● Implement a product lifecycle management system: Uses data analytics to track
the lifecycle of each product and forecast when it may become obsolete. This can
help Unilever to order the right amount of inventory and avoid obsolescence.
● Implement a product recall system : allows the company to remove obsolete
products from the market before they become a liability.
● Adapt to changing consumer preferences: Consumer preferences and behaviors
evolve over time so Unilever should continuously monitor and adapt to these
changes by conducting market research, consumer surveys, and trend analysis.
This will help identify emerging opportunities and enable the company to tailor
its products and marketing strategies accordingly.
● Invest in digital transformation:Unilever can leverage technology to optimize its
operations and engage with customers more effectively, enhance supply chain
efficiency, personalize marketing efforts, and improve customer experiences.

* Inaccurate inventory counts: Unilever may face the issue of inaccurate inventory
counts, leading to stockouts or overstocking. This can occur if inventory counts are not
updated in real-time or if there are errors in the counting process.

Suggestions:

● Implement automated inventory management systems: Invest in advanced

inventory management software or systems that utilize barcode scanning, RFID
technology, or other automated solutions. These systems can help track and
manage inventory in real-time, reducing the reliance on manual counting and
minimizing human errors.
● Conduct regular cycle counts: Implement a cycle counting process where a
portion of inventory is counted on a regular basis, rather than relying solely on
periodic physical inventory counts. This ongoing counting method helps identify
and rectify inaccuracies more promptly, preventing them from compounding over
time.
● Use data analytics: Leverage data analytics tools to analyze inventory trends,
identify patterns of inaccuracies, and proactively address potential issues. Data
analysis can provide insights into inventory discrepancies, such as common errors,
problem areas, or recurring issues that need attention.

34
Overall, Unilever can fix these issues by implementing a robust inventory management
strategy that leverages data analytics, demand planning, and automated inventory tracking
to optimize inventory levels, minimize stockouts and obsolescence, and enhance
customer satisfaction.

2. Issues and suggestions in supplier management

Supplier management is also an important aspect of Unilever's supply chain management.

There are some issues that the company may face in this area. Here are some of the
common issues and suggestions for improving supplier management at Unilever:

* Supply chain disruptions: Unilever may face the issue of supply chain disruptions due
to factors such as natural disasters, geopolitical instability, or transportation disruptions.
This can lead to delays in the delivery of raw materials or finished goods, which can
impact Unilever's production and sales.
Suggestions :
● Diversify suppliers and manufacturing locations: Diversify its supplier base by
sourcing from multiple suppliers in different geographic regions. This can help
ensure that the company has access to alternative sources of supply during times
of disruption.
● Develop strong supplier relationships: Unilever can foster strong relationships
with key suppliers by establishing open lines of communication, sharing forecasts
and demand projections, and collaborating on contingency plans. Building strong
partnerships can help suppliers understand Unilever's needs and proactively
address potential disruptions.
● Engage in scenario planning: Conduct scenario planning exercises to assess the
potential impact of various disruptive events and develop response plans. This
process involves simulating different scenarios, such as supplier failures,
transportation disruptions, or regulatory changes, and identifying alternative
strategies to mitigate the impact.
● Invest in technology and automation: helps provide real-time visibility into the
supply chain. This includes tracking shipments, monitoring inventory levels, and
utilizing data analytics to identify potential bottlenecks or disruptions early on.
Enhanced visibility enables proactive decision-making and swift response to
mitigate disruptions.

35
*Poor supplier performance: Unilever may also face the issue of poor supplier
performance such as delivery late, insufficient quantity, leading to quality issues, delivery
delays, or increased costs. Instances of poor supplier performance can disrupt the supply
chain and impact Unilever's ability to meet customer demands.
Suggestions:
● Implement a supplier performance management system: uses key performance
indicators (KPIs) to measure supplier performance in areas such as on-time
delivery, quality, and cost. This can help identify underperforming suppliers and
enable Unilever to take corrective action, such as renegotiating contracts or
finding alternative suppliers.
● Build strong supplier relationships: Unilever can work with its suppliers to
improve communication, collaboration, and transparency, and build stronger
partnerships.
● Compensation: In case of delivery delays, it is important to note that specific
compensation policies and agreements may be applied between Unilever and
suppliers. These clauses may cover aspects such as financial penalties, discounts,
or alternative arrangements to mitigate the impact of the delay. Delivering late 5
days, the suppliers for Unilever must compensate 30% of the total value of the
order, if it happens many times, Unilever can change suppliers and ask for contract
compensation.
*Sustainability issues: Unilever may face the issue of sustainability issues in its supply
chain, such as environmental or social issues. This can impact Unilever's reputation and
brand image, as well as its ability to attract and retain customers.
Suggestions:
● Implement a supplier sustainability management program: assesses the
sustainability performance of its suppliers using criteria such as environmental
impact, social responsibility, and ethical business practices.
● Circular economy principles: Embed circular economy principles into product
design, packaging, and waste management practices. Prioritize recyclable or
compostable packaging materials and explore innovative packaging solutions to
minimize environmental impact.
● Supplier engagement: Unilever can collaborate closely with suppliers to enhance
sustainability practices throughout the supply chain. Provide support, resources,

36
 and incentives for suppliers to improve their environmental performance, social
standards, and ethical practices.
● Continuous improvement and reporting: Regularly review and evaluate
sustainability performance to identify areas for improvement. Conduct life cycle
assessments to understand the full environmental impact of products and
processes. Transparently report progress against sustainability goals and disclose
relevant data to stakeholders.
* Intellectual property issues: Unilever may face the issue of intellectual property issues
in its supply chain, such as counterfeiting or infringement. This can impact Unilever's
brand image and revenue, as well as its ability to protect its intellectual property rights.
Suggestions:
● Implement a supplier intellectual property management program: assesses the
intellectual property performance of its suppliers using criteria such as security,
confidentiality, and compliance with intellectual property laws and regulations.
● Strengthen intellectual property protection measures: Implement strong measures
to protect Unilever's intellectual property assets, such as patents, trademarks,
copyrights, and trade secrets. This includes filing timely and appropriate patent
applications, registering trademarks, implementing confidentiality agreements,
and implementing physical and digital security measures to safeguard trade
secrets.
● Monitor and enforce intellectual property rights:Implement a proactive
monitoring system to identify and address potential infringements of Unilever's
intellectual property rights. Regularly monitor the market, online platforms, and
competitors for any unauthorized use or infringement. Take swift action to enforce
IP rights through legal means when necessary. This can help ensure that Unilever's
supply chain is aligned with the company's intellectual property goals and values.
● Stay updated on IP trends and changes: Keep abreast of evolving intellectual
property laws, regulations, and best practices. Stay informed about new
technologies, emerging intellectual property issues, and changes in the
competitive landscape to adapt IP strategies accordingly.
VIII. Conclusion

Unilever's global supply chain management is a crucial aspect of its business operations.
The company has demonstrated its commitment to sustainability and responsible sourcing

37
 practices, setting ambitious targets to reduce its environmental impact and promote
sustainable farming practices. Unilever has also invested in its supply chain management
processes and collaborated closely with suppliers and partners to improve efficiency and
transparency.

The company's ongoing investment in its processes and technology, along with its
commitment to sustainability. Unilever has implemented various initiatives, including
digitization and automation of its processes, smarter forecasting, and improved
collaboration with suppliers. The company has also experimented with new technologies,
such as blockchain, to improve traceability and transparency in its supply chain. Unilever
has also invested in its logistics network to reduce transportation costs and improve
efficiency, such as optimizing its distribution network and using more sustainable modes
of transportation. Managing the supply chain well has helped Unilever meet the evolving
needs of its customers, stakeholders, and the broader global community.

However, Unilever still faces challenges in its supply chain management. Some of these
challenges include managing inventory levels, optimizing its logistics network, and
ensuring compliance with regulations and ethical standards. To address these challenges,
Unilever will need to continue to invest in its supply chain management processes, adopt
new technologies and best practices, and work closely with its suppliers and partners to
address the challenges of managing its supply chain. By doing so, Unilever can maintain
its position as a leader in sustainability and responsible sourcing practices, and continue
to meet the demands of consumers who are increasingly concerned about the effects that
the products they use have on the environment and society.

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X. Contribution
Parts Student name Student ID Contribution
%
- Unilever’s supply chain Lương Công Khánh Duy 20071014 100%
management
- Unilever’s Supply chain Ngô Kim Oanh 20070296 100%
design
- Forecasting
management
- Unilever’s supply chain Nguyễn Thu Trang 20070367 100%
management issues and
suggestions
- Global supply chain
management
- Executive summary,
Conclusion
- Unilever’s lean Nguyễn Quang Tuấn 20071053 100%
management
- Unilever’s profile Đỗ Hà Vy 20070386 100%
- Unilever’s Strategic
Priorities

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