Showing Page:
1/15
UNILEVER PAKISTAN
Project Outline
History
Introduction to Unilever
Brands
Vision
Mission
Analysis of Mission Statement
Core Values
Strategy Formulation Analytical Framework
Input Stage (Stage 1)
a. IFE matrix (Internal factor evaluation)
b. EFE matrix (External factor evaluation)
c. CPM matrix (Competitive Profile Matrix)
Matching Stage (Stage 2)
a. SWOT matrix (Strengths-Weaknesses-Opportunity-Threats)
b. BCG matrix (Boston Consulting Group)
c. SPACE matrix (Strategic position and Action Evaluation)
d. IE Matrix (Internal External Matrix)
Decision Stage (Stage 3)
a. QSPM (Quantitative Strategic Position Matrix)
Showing Page:
2/15
About
Unilever is the largest FMCG industry in Pakistan, as well as one of the largest multinationals
operating in the country. Unilever Group has been operating in Pakistan since 1948
History
UPL was established some fifty years ago in the newly created Pakistan. The town of Rahim Yar
Khan was the site chosen for setting up vegetable oil factory in 1958 and that is where the first
UPL manufacturing facility developed. Today, Unilever Pakistan is a force to reckon with. Its
contribution to Pakistan’s economic development cannot be overestimated. Now operating four
factories at different locations around the country, the company contributes a significant proportion
of the country's taxes. It employs a large number of local managers and workers. It provides a pool
of well-trained and highly motivated manpower to other segments and has introduced new and
innovative technologies into the country. The UPL Head Office was shifted to Karachi form the
Rahim Yar Khan site in the mid 60’s.
Introduction to Unilever
“No matter who you are, or where in the world you are, the chances are that our products are a
familiar part of your daily routine. Every day, around the world, people reach for Unilever
products”.
The company had a turnover of Rs.15 billion in 2020, and enjoys a leading position in most of its
core Home and Personal Care and Foods categories, e.g. Personal Wash, Personal Care, Laundry,
Beverages (Tea) and Ice Cream. The company operates through 5 regional offices, 4 wholly owned
and 6 third party manufacturing sites across Pakistan.
The Company has been closely connected to the Pakistani people and its brands have been an
integral feature in their daily lives. In fact, the nature of our business enables our brands to be the
pulse and heartbeat of the 164 million people in Pakistan. This is a huge commitment, which makes
us responsible and accountable to all our stakeholders and society as a whole and strengthens our
resolve to:
Make a positive difference to the lives of low income consumers.
Create new opportunities for growth.
Improve the overall quality of life in Pakistan, by promoting education, nutrition, health
and hygiene.
Brands
Unilever makes and sells products under more than 400 brand names worldwide. Two billion
people use them on any given day.
Food & Drink
Home Care
Personal Care
Showing Page:
3/15
Vision
Our vision is to grow our business, while decoupling our environmental foot print from our growth
and increasing our positive social impact.
Mission
We are driven by our purpose: to make sustainable living commonplace.
It’s why we come to work. It’s why we’re in business. It’s how we inspire exceptional
performance.
Back in 1883, Sunlight Soap was launched in the UK by our founder it was pioneering, it was
innovative and it had a purpose: to popularize cleanliness and bring it within reach of ordinary
people. That was sustainable living, even then. We now have over 400 brands and we are still
driven by purpose.
We want to do more good for our planet and our society not just less harm. We want to act on
the social and environmental issues facing the world and we want to enhance people’s lives with
our products.
We’ve been pioneers, innovators and future-makers for over 120 years we plan to continue doing
that. And we plan to do it sustainably.
Analysis of Mission Statement:
No
Component
Yes/No
1
Customers
Yes (Ordinary people)
2
Products/Services
Yes (Sunlight Soap)
3
Markets
Yes (UK)
4
Concern for survival, growth and profitability
Yes (We now have over 400
brands and we are still driven
by purpose.)
5
Technology
No
6
Philosophy
Yes (to make sustainable
living commonplace)
7
Self-concept
Yes ( we have been pioneers,
innovators and future makers
for over 120 years.)
8
Concern for public image
Yes ( We want to do more
good for our planet and our
society)
9
Concern for employees
No
Showing Page:
4/15
Core Values
Impeccable Integrity
Wowing our Consumers & Customers
Living an Enterprise Culture
Demonstrating a Passion for Winning
Bringing out the Best in All of Us
Making a Better World
Stage 1: Input Stage
Internal Factor Evaluation (IFE) Matrix
Key Internal Factors
Weight
Rating
Weighted
Score
Strengths:
Largest Producer
0.10
4
0.40
Advance Technology
0.05
4
0.20
Supply Chain Management
0.05
3
0.15
Financial Backing
0.20
4
0.80
Experienced Top Management
0.20
3
0.60
Weaknesses:
Tall Organization Structure
0.10
4
0.40
High Operating Expenses
0.05
2
0.10
High Production Cost
0.05
2
0.10
Long term Strategies
0.10
3
0.30
Emphasize on a few Products
0.10
1
0.10
Total
1.00
3.15
Explanation of Key Internal Factors:
INTERNAL STRENGTHS:
Largest Producer (S1)
Unilever Pakistan Limited is the largest producer of consumer products in Pakistan and has strong
brands in every field such as Close Up, Dalda, Surf, Lifebuoy, Lux, etc. It has four factories
operating in the country. That’s why, I have given the rating of 4 to this strength.
Advance technology (S2)
Unilever Pakistan Limited is the only company in Pakistan which has its own corner research
department. Unilever Pakistan is actively using 33 technologies for its website. These include
Viewport Meta, IPhone / Mobile Compatible, and SSL by Default. It is also a big strength of
Unilever so i have given the rating of 4 to this strength.
Showing Page:
5/15
Supply Chain Management (S3)
It has the largest and efficient distribution network than any its competitors. The firm has
segmented structure of supply chain management. The purchasing, production control and
distribution departments have responsibility for material management. Supplier selection is based
on price, quality and delivery. I have given the rating of 3 because it is above average strength of
Unilever Pakistan.
Financial Backing (S4)
The company is very strong financially. The sales of Unilever Pakistan Limited in 2020 was almost
15 billion. And nowadays, its share is traded at 19,500 in Pakistan Stock Exchange. It has a market
cap of 124,213,674,000 with 6,369,932 total number of shares. Although company is financially
stable. So, it is its superior response strength (Rating 4).
Experience Top Management (S5)
Unilever Pakistan Limited enjoys the services of highly professional management in the area of
sales, marketing, technical and production. Unilever Pakistan Limited is an old company, founded
in 1948, So its top management is very Experienced. It has no. of seven top Executives. It is a
common strength but still a strength. That’s why, I have given the rating of 3 to this strength.
INTERNAL WEAKNESSES:
Tall Organization Structure (W1)
Due to tall structure it is difficult to handle the organization easily. It is also called hierarchical
structure. A hierarchical or 'tall' structure has many leaders and layers of management, and
businesses with this structure often use a 'top-down' approach with a long chain of command. In a
hierarchical structure, managers will have a narrow span of control and a relatively small number
of subordinates or staff. It is big weakness from all weaknesses, that’s why rating of 4 given to this
weakness.
High Operating Expenses (W2)
No doubt its sales are large but in same time its operating expenses are huge. The operating
Expenses of Unilever Pakistan Limited in 2020 was an amount of 285,906,000 with the sales of
15,572,747,000. It is minor weakness of Unilever Pakistan because operating expense are 1.8% of
sales. Therefore, I have given the rating of 2 to this weakness.
High Cost of Production (W3)
As in the production, Unilever keeps its environment very neat and clean, and produce high quality
products so cost of production is very high. Increased import duties are also adding to the prices
of the products. It is also a weakness but it is minor. That’s why I have given the 2 rating.
Showing Page:
6/15
Long term strategies (W4)
Unilever Pakistan Limited go for long term strategies for all their product categories which prove
to be a weakness with change in the circumstances and taste, trends of people. Unilever Pakistan
is using Market Penetration as a primary strategy. Through this strategy Unilever tries to grab the
market share through low pricing. This usually is the case when Unilever is trying to market those
products which are the basic necessities of life.
Emphasize on only few products (W5)
Emphasizing only few products while ignoring others which could give them potential market
shares e.g. beverages section. Unilever Pakistan has market penetration strategy means to sell
existing product in an existing market to acquires market share. But if it focuses on the product
development then it will be easy for Unilever to acquire market share, but company is not doing
this thing. Hence, it is minor weakness of company, that’s why I have the rating of 1.
External factor Evaluation Matrix:
Key External Factors
Weight
Rating
Weighted
Score
Opportunities:
Hygiene Consciousness
0.20
4
0.80
Increasing Population
0.15
3
0.45
Innovation(R&D)
0.10
2
0.20
Product Diversification
0.10
4
0.40
Explore New Markets
0.05
4
0.20
Threats:
Product smuggling
0.15
1
0.15
Increase demand for Antibacterial Soaps
0.05
3
0.15
Counterfeit Products
0.10
3
0.30
International Trends
0.05
3
0.15
Local Competition
0.05
4
0.20
Total
1.00
3.10
EXTERNAL OPPORTUNITIES:
Hygiene Consciousness (O1)
People are becoming more conscious about their health and are becoming more conscious about
brands. As Unilever has good positioning in consumer’s mind so it can increase their market share
to launch products in hygienic category.
Showing Page:
7/15
Increasing Population (O2)
As population is increasing it may lead to create valuable opportunity to enhance the growth of
Unilever.
Innovation(R&D) (O3)
Innovation in Unilever may create opportunity to more penetrate in the market.
Product Diversification (O4)
They have capital to invest they can explore new product categories e.g. in food and beverages
they can develop new products like Rafhan has launched custard, jelly, kheer mix, rasmalai mix,
etc. These products can prove a “cash cows” as customer in Pakistan always welcome food items
especially they will welcome due to brand image of Blue Band and Dalda ghee in food category
and due to Lipton and Supreme in beverages category.
Explore New Markets (O5)
Unilever Pakistan has opportunity to develop new markets by identifying the needs of customers.
EXTERNAL THREATS:
Product smuggling (T1)
Unilever Pakistan Limited has not been able to place any check on its smuggling shampoos into
Pakistan e.g. Indonesian Sunsilk is made according to the demographic of Indonesia, when it will
be used in Pakistan it will damage the hair of people, which detoriate the brand image and
decreases the local sales of Unilever Pakistan.
Increase demand for Antibacterial Soaps (T2)
Demand for antibacterial soaps is increasing while Unilever has not yet been introduced any
antibacterial soap, it may switch the brand loyal of Unilever.
Counterfeit Products (T3)
There may be imitation of products in Pakistan which may damage the goodwill of Unilever
Pakistan ltd.
International Trends (T4)
People of Pakistan prefer to purchase foreign products. It may be proved to be a threat for Unilever.
Local Competition (T5)
Number of local companies producing detergents at low price. So, competition for Unilever
Pakistan is increasing.
Showing Page:
8/15
Competitor Profile Matrix
Weight
Rating
Weighted
Score
Rating
Weighted
Score
Rating
Weighted
Score
0.20
3
0.60
3
0.60
3
0.60
0.20
4
0.80
4
0.80
3
0.60
0.10
3
0.30
4
0.40
3
0.30
0.10
4
0.40
4
0.40
4
0.40
0.20
2
0.40
4
0.80
3
0.60
0.20
4
0.80
3
0.60
2
0.40
1.00
3.30
3.60
2.90
Quality Products (CSF 1):
I have given the same rating to Unilever and it’s both competitors because the competition in the
market is very high and companies are producing quality products. If companies will compromise
on the quality of product, then the customers will switch the brand easily because switching cost
for customers is high in this case.
Attractive Price (CSF 2):
Unilever has a distinct competitive advantage over its nearest competitor, Proctor and Gamble
because of its flexible pricing. As I have told earlier that competition in the market is very high so
there will be price war in the market. Unilever have reasonable prices for their products because
Unilever has been Economies of scale and learning curve.
Brand Loyalty and Awareness (CSF 3):
Brand loyalty occurs when a customer chooses to repeatedly purchase a product produced by the
same company instead of a substitute product produced by a competitor. So, I have observed many
times in the market that people like to buy the products of nestle instead of Unilever. That’s why
I have given the high rating to nestle than Unilever.
Distribution Channel (CSF 4):
I have rating the same to Unilever and its direct competitors, Nestle and Procter & Gamble, because
along with Unilever, its competitors have also very competitive and prominent strategy for
Unilever
Nestle
P&G
Showing Page:
9/15
distribution of products. Unilever has direct access to consumers via a network of more than four
hundred warehouses and twenty-five million retail stores. Among direct-to-consumer channels,
Unilever brands and products are served in: hypermarkets. wholesalers and cash and carry. Besides
this, Nestle Pakistan and Procter & Gamble also have its own distribution channels.
Innovation and R&D (CSF 5):
I have given rating of 4 to Nestle company higher than Unilever and P&G because Nestle is doing
innovation. Khyber Pakhtunkhwa, World Bank Group and Nestlé Pakistan join hands for
responsible tourism in the province. Along with Nestlé Pakistan introduces paper straws across
ready-to-drink products, eliminates 400 million plastic straws.
Emerging market Penetration (CSF 6):
Emerging market Penetration means to sell existing products in existing markets. So Unilever
Pakistan sells their products in its existing markets, But Nestle Pakistan Explores its new markets
to sell their products in a new market. That’s why I have given the higher rating to Unilever than
Nestle.
Stage 2: Matching Stage
SWOT Matrix:
SWOT Matrix:
Strengths:
Weaknesses:
Largest Producer
Tall Organization Structure
Advance Technology
High Operating Expenses
Supply Chain Management
High Production Cost
Financial Backing
Long term Strategies
Experienced Top
Management
Emphasize on a few Products
Opportunities:
SO Strategies
WO Strategies
Hygiene Consciousness
Create awareness
between customers
about hygiene.
Accommodate rural
demand by your
supply network.
Launch new products
for lower class.
Accommodate local
demand by joint
ventures.
Create new markets
and new segments.
Increasing Population
Innovation(R&D)
Product Diversification
Explore New Markets
Threats:
ST Strategies
WT Strategies
Product smuggling
Control Cost
Reduce high operating
expense and cost of
production for strong
position against
competitors
Increase demand for
Antibacterial Soaps
Counterfeit Products
International Trends
Local Competition
Showing Page:
10/15
Space matrix:
Financial Position
Rating
Net income increased by almost 40%
+4
Net sales increased by almost 12%
+6
ROA increased by 5.60% (2019-18)
+5
Earnings per Share
+3
Cash flows
+2
Average
+4
Industry Position
Rating
Consumption oriented culture
+3
Increase in Raw material cost
+2
Barriers to entry
+4
Growth Potential
+6
Financial Stability
+5
Average
+4
Competitive Advantage
Rating
Customer Loyalty
-3
Control over supplies and distribution
-4
Market Share
-1
Product Quality
-2
Product Life Cycle
-3
Average
-2.6
Environmental Stability
Rating
Technology
-1
Competition
-2
Inflation
-6
Law and order situation
-5
Substitute
-3
Average
-3.4
X axis: IP+CA = 4+(-2.6) = 1.4
Y axis: FS+ES = 4+(-3.4) = 0.6
Showing Page:
11/15
Graph:
Aggressive Quadrant:
Integrating Strategies (Backward, Forward and Horizontal Integration), Intensive Strategies (Market
Development, Product Development, Market Penetration) and Diversification (Related or unrelated) are
best strategies in this position.
The following actions would be potential options for a Unilever Pakistan in this position:
Focus on products that can really compete with other businesses
A focused marketing campaign to gain a larger market share
Focus on offering the lowest price compared to competitors
Look for potential companies to take over and increase the market share
Showing Page:
12/15
BCG Matrix:
Relative Market Share
High Medium Low
1.0 0.5 0
High +20
Medium 0
Industry
Growth
Low -20
Unilever Pakistan falls in Question mark quadrant in BCG matrix. Companies in Question
Marks Quadrant have a low relative market share position, yet they compete in a high-growth
industry. Generally, these firms’ cash needs are high and their cash generation is low. These
businesses are called question marks because the organization must decide whether to strengthen
them by pursuing an intensive strategy (market penetration, market development, or product
development) or to sell them.
Star
Question Mark
Cash Cow
Dog
Company
Name
Revenue
Profit
Percent
Profit
Relative
Market
Share
Industry
Growth
Unilever
Pakistan
13,291,424,000
2,452,938,000
18%
0.1
11.65%
Nestle
Pakistan
115,962,473,000
7,354,467,000
6%
8.72
11.65%
Showing Page:
13/15
Internal External Matrix:
IFE Total weighted score
Strong Average Weak
4.0 3.0 2.0 1.0
High 4.0
3.0
Medium
EFE
Total
weighted 2.0
score
Low 1.0
Unilever Pakistan falls in Grow and Build region in IE matrix. And has good position because it
is in first cell or quadrant. So, The Unilever Pakistan should follow strategies according to its
position like integrating strategies (Backward, Forward and Horizontal integration) and Intensive
strategies (Product Development, Market Development and Market Penetration).
I
I
II II
III
I IV
V
VI
VII
VIII
IX
Company
Name
Revenue
Profit
Percent
Profit
IFE
Scores
EFE
Scores
Unilever
Pakistan
13,291,424,000
2,452,938,000
18%
3.15
3.10
Grow &
Build
Showing Page:
14/15
Stage 3: Decision Stage
QSPM (Quantitative Strategic Position Matrix)
Integration
Product & Market
Development
Key Factors
Weight
AS
TAS
AS
TAS
Strengths:
Largest Producer
0.10
2
0.20
3
0.30
Advance Technology
0.05
3
0.15
3
0.15
Supply Chain Management
0.05
2
0.10
3
0.15
Financial Backing
0.20
3
0.60
4
0.80
Experienced Top
Management
0.20
1
0.20
3
0.60
Weaknesses:
Tall Organization Structure
0.10
3
0.30
2
0.20
High Operating Expenses
0.05
2
0.10
3
0.15
High Production Cost
0.05
1
0.05
2
0.10
Long term Strategies
0.10
3
0.30
2
0.20
Emphasize on a few
Products
0.10
2
0.20
1
0.10
Opportunities:
Hygiene Consciousness
0.20
1
0.20
2
0.40
Increasing Population
0.15
2
0.30
2
0.30
Innovation(R&D)
0.10
3
0.30
2
0.20
Product Diversification
0.10
4
0.40
1
0.10
Explore New Markets
0.05
1
0.05
3
0.15
Threats:
Product smuggling
0.15
1
0.15
1
0.15
Increase demand for
Antibacterial Soaps
0.05
1
0.05
1
0.05
Counterfeit Products
0.10
3
0.30
2
0.20
International Trends
0.05
4
0.20
1
0.05
Local Competition
0.05
4
0.20
2
0.10
Total
4.35
4.45
Showing Page:
15/15
Implementation
Appropriate strategy for Unilever is Product & Market Development. UNILEVER is operating
globally. It means that FMCG is such an industry which can be grown globally. Unilever should
remain in its present business and also do product development according to customer need like
beverages and antibacterial soaps and should introduce these products in new geographical area.
Following are necessary factors that must be present while choosing market development strategy:
UNILEVER has its own strong distribution channel.
UNILEVER is very successful at what it does.
Untapped rural market and market of developing countries exist for Unilever to cover.
Unilever is a strong Multinational Enterprise in Pakistan. It has abundant resources both financial
and human, so it can easily expand geographically.

Unformatted Attachment Preview

UNILEVER PAKISTAN Project Outline • • • • • • • • • a. b. c. • a. b. c. d. • a. History Introduction to Unilever Brands Vision Mission Analysis of Mission Statement Core Values Strategy Formulation Analytical Framework Input Stage (Stage 1) IFE matrix (Internal factor evaluation) EFE matrix (External factor evaluation) CPM matrix (Competitive Profile Matrix) Matching Stage (Stage 2) SWOT matrix (Strengths-Weaknesses-Opportunity-Threats) BCG matrix (Boston Consulting Group) SPACE matrix (Strategic position and Action Evaluation) IE Matrix (Internal External Matrix) Decision Stage (Stage 3) QSPM (Quantitative Strategic Position Matrix) About Unilever is the largest FMCG industry in Pakistan, as well as one of the largest multinationals operating in the country. Unilever Group has been operating in Pakistan since 1948 History UPL was established some fifty years ago in the newly created Pakistan. The town of Rahim Yar Khan was the site chosen for setting up vegetable oil factory in 1958 and that is where the first UPL manufacturing facility developed. Today, Unilever Pakistan is a force to reckon with. Its contribution to Pakistan’s economic development cannot be overestimated. Now operating four factories at different locations around the country, the company contributes a significant proportion of the country's taxes. It employs a large number of local managers and workers. It provides a pool of well-trained and highly motivated manpower to other segments and has introduced new and innovative technologies into the country. The UPL Head Office was shifted to Karachi form the Rahim Yar Khan site in the mid 60’s. Introduction to Unilever “No matter who you are, or where in the world you are, the chances are that our products are a familiar part of your daily routine. Every day, around the world, people reach for Unilever products”. The company had a turnover of Rs.15 billion in 2020, and enjoys a leading position in most of its core Home and Personal Care and Foods categories, e.g. Personal Wash, Personal Care, Laundry, Beverages (Tea) and Ice Cream. The company operates through 5 regional offices, 4 wholly owned and 6 third party manufacturing sites across Pakistan. The Company has been closely connected to the Pakistani people and its brands have been an integral feature in their daily lives. In fact, the nature of our business enables our brands to be the pulse and heartbeat of the 164 million people in Pakistan. This is a huge commitment, which makes us responsible and accountable to all our stakeholders and society as a whole and strengthens our resolve to: • • • Make a positive difference to the lives of low income consumers. Create new opportunities for growth. Improve the overall quality of life in Pakistan, by promoting education, nutrition, health and hygiene. Brands Unilever makes and sells products under more than 400 brand names worldwide. Two billion people use them on any given day. • • • Food & Drink Home Care Personal Care Vision Our vision is to grow our business, while decoupling our environmental foot print from our growth and increasing our positive social impact. Mission We are driven by our purpose: to make sustainable living commonplace. It’s why we come to work. It’s why we’re in business. It’s how we inspire exceptional performance. Back in 1883, Sunlight Soap was launched in the UK by our founder – it was pioneering, it was innovative and it had a purpose: to popularize cleanliness and bring it within reach of ordinary people. That was sustainable living, even then. We now have over 400 brands and we are still driven by purpose. We want to do more good for our planet and our society – not just less harm. We want to act on the social and environmental issues facing the world and we want to enhance people’s lives with our products. We’ve been pioneers, innovators and future-makers for over 120 years – we plan to continue doing that. And we plan to do it sustainably. Analysis of Mission Statement: No 1 2 3 4 Component Customers Products/Services Markets Concern for survival, growth and profitability 5 6 Technology Philosophy 7 Self-concept 8 Concern for public image 9 Concern for employees Yes/No Yes (Ordinary people) Yes (Sunlight Soap) Yes (UK) Yes (We now have over 400 brands and we are still driven by purpose.) No Yes (to make sustainable living commonplace) Yes ( we have been pioneers, innovators and future makers for over 120 years.) Yes ( We want to do more good for our planet and our society) No Core Values • • • • • • Impeccable Integrity Wowing our Consumers & Customers Living an Enterprise Culture Demonstrating a Passion for Winning Bringing out the Best in All of Us Making a Better World Stage 1: Input Stage Internal Factor Evaluation (IFE) Matrix Key Internal Factors Weight Rating Weighted Score 0.10 0.05 0.05 0.20 0.20 4 4 3 4 3 0.40 0.20 0.15 0.80 0.60 0.10 0.05 0.05 0.10 0.10 4 2 2 3 1 0.40 0.10 0.10 0.30 0.10 Strengths: Largest Producer Advance Technology Supply Chain Management Financial Backing Experienced Top Management Weaknesses: Tall Organization Structure High Operating Expenses High Production Cost Long term Strategies Emphasize on a few Products Total Explanation of Key Internal Factors: 1.00 3.15 INTERNAL STRENGTHS: Largest Producer (S1) Unilever Pakistan Limited is the largest producer of consumer products in Pakistan and has strong brands in every field such as Close Up, Dalda, Surf, Lifebuoy, Lux, etc. It has four factories operating in the country. That’s why, I have given the rating of 4 to this strength. Advance technology (S2) Unilever Pakistan Limited is the only company in Pakistan which has its own corner research department. Unilever Pakistan is actively using 33 technologies for its website. These include Viewport Meta, IPhone / Mobile Compatible, and SSL by Default. It is also a big strength of Unilever so i have given the rating of 4 to this strength. Supply Chain Management (S3) It has the largest and efficient distribution network than any its competitors. The firm has segmented structure of supply chain management. The purchasing, production control and distribution departments have responsibility for material management. Supplier selection is based on price, quality and delivery. I have given the rating of 3 because it is above average strength of Unilever Pakistan. Financial Backing (S4) The company is very strong financially. The sales of Unilever Pakistan Limited in 2020 was almost 15 billion. And nowadays, its share is traded at 19,500 in Pakistan Stock Exchange. It has a market cap of 124,213,674,000 with 6,369,932 total number of shares. Although company is financially stable. So, it is its superior response strength (Rating 4). Experience Top Management (S5) Unilever Pakistan Limited enjoys the services of highly professional management in the area of sales, marketing, technical and production. Unilever Pakistan Limited is an old company, founded in 1948, So its top management is very Experienced. It has no. of seven top Executives. It is a common strength but still a strength. That’s why, I have given the rating of 3 to this strength. INTERNAL WEAKNESSES: Tall Organization Structure (W1) Due to tall structure it is difficult to handle the organization easily. It is also called hierarchical structure. A hierarchical or 'tall' structure has many leaders and layers of management, and businesses with this structure often use a 'top-down' approach with a long chain of command. In a hierarchical structure, managers will have a narrow span of control and a relatively small number of subordinates or staff. It is big weakness from all weaknesses, that’s why rating of 4 given to this weakness. High Operating Expenses (W2) No doubt its sales are large but in same time its operating expenses are huge. The operating Expenses of Unilever Pakistan Limited in 2020 was an amount of 285,906,000 with the sales of 15,572,747,000. It is minor weakness of Unilever Pakistan because operating expense are 1.8% of sales. Therefore, I have given the rating of 2 to this weakness. High Cost of Production (W3) As in the production, Unilever keeps its environment very neat and clean, and produce high quality products so cost of production is very high. Increased import duties are also adding to the prices of the products. It is also a weakness but it is minor. That’s why I have given the 2 rating. Long term strategies (W4) Unilever Pakistan Limited go for long term strategies for all their product categories which prove to be a weakness with change in the circumstances and taste, trends of people. Unilever Pakistan is using Market Penetration as a primary strategy. Through this strategy Unilever tries to grab the market share through low pricing. This usually is the case when Unilever is trying to market those products which are the basic necessities of life. Emphasize on only few products (W5) Emphasizing only few products while ignoring others which could give them potential market shares e.g. beverages section. Unilever Pakistan has market penetration strategy means to sell existing product in an existing market to acquires market share. But if it focuses on the product development then it will be easy for Unilever to acquire market share, but company is not doing this thing. Hence, it is minor weakness of company, that’s why I have the rating of 1. External factor Evaluation Matrix: Key External Factors Weight Rating Weighted Score 0.20 0.15 0.10 0.10 0.05 4 3 2 4 4 0.80 0.45 0.20 0.40 0.20 Product smuggling Increase demand for Antibacterial Soaps Counterfeit Products International Trends Local Competition 0.15 0.05 0.10 0.05 0.05 1 3 3 3 4 0.15 0.15 0.30 0.15 0.20 Total 1.00 Opportunities: Hygiene Consciousness Increasing Population Innovation(R&D) Product Diversification Explore New Markets Threats: 3.10 EXTERNAL OPPORTUNITIES: Hygiene Consciousness (O1) People are becoming more conscious about their health and are becoming more conscious about brands. As Unilever has good positioning in consumer’s mind so it can increase their market share to launch products in hygienic category. Increasing Population (O2) As population is increasing it may lead to create valuable opportunity to enhance the growth of Unilever. Innovation(R&D) (O3) Innovation in Unilever may create opportunity to more penetrate in the market. Product Diversification (O4) They have capital to invest they can explore new product categories e.g. in food and beverages they can develop new products like Rafhan has launched custard, jelly, kheer mix, rasmalai mix, etc. These products can prove a “cash cows” as customer in Pakistan always welcome food items especially they will welcome due to brand image of Blue Band and Dalda ghee in food category and due to Lipton and Supreme in beverages category. Explore New Markets (O5) Unilever Pakistan has opportunity to develop new markets by identifying the needs of customers. EXTERNAL THREATS: Product smuggling (T1) Unilever Pakistan Limited has not been able to place any check on its smuggling shampoos into Pakistan e.g. Indonesian Sunsilk is made according to the demographic of Indonesia, when it will be used in Pakistan it will damage the hair of people, which detoriate the brand image and decreases the local sales of Unilever Pakistan. Increase demand for Antibacterial Soaps (T2) Demand for antibacterial soaps is increasing while Unilever has not yet been introduced any antibacterial soap, it may switch the brand loyal of Unilever. Counterfeit Products (T3) There may be imitation of products in Pakistan which may damage the goodwill of Unilever Pakistan ltd. International Trends (T4) People of Pakistan prefer to purchase foreign products. It may be proved to be a threat for Unilever. Local Competition (T5) Number of local companies producing detergents at low price. So, competition for Unilever Pakistan is increasing. Competitor Profile Matrix Critical Success Factors Quality Products Attractive Price Brand Loyalty & Awareness Distribution Channel Innovation and R&D Emerging market Penetration Total Weight Unilever Nestle Rating Weighted Rating Score Weighted Score 0.20 3 0.60 3 0.60 3 0.60 0.20 4 0.80 4 0.80 3 0.60 0.10 3 0.30 4 0.40 3 0.30 0.10 4 0.40 4 0.40 4 0.40 0.20 2 0.40 4 0.80 3 0.60 0.20 4 0.80 3 0.60 2 0.40 1.00 3.30 3.60 P&G Rating Weighted Score 2.90 Quality Products (CSF 1): I have given the same rating to Unilever and it’s both competitors because the competition in the market is very high and companies are producing quality products. If companies will compromise on the quality of product, then the customers will switch the brand easily because switching cost for customers is high in this case. Attractive Price (CSF 2): Unilever has a distinct competitive advantage over its nearest competitor, Proctor and Gamble because of its flexible pricing. As I have told earlier that competition in the market is very high so there will be price war in the market. Unilever have reasonable prices for their products because Unilever has been Economies of scale and learning curve. Brand Loyalty and Awareness (CSF 3): Brand loyalty occurs when a customer chooses to repeatedly purchase a product produced by the same company instead of a substitute product produced by a competitor. So, I have observed many times in the market that people like to buy the products of nestle instead of Unilever. That’s why I have given the high rating to nestle than Unilever. Distribution Channel (CSF 4): I have rating the same to Unilever and its direct competitors, Nestle and Procter & Gamble, because along with Unilever, its competitors have also very competitive and prominent strategy for distribution of products. Unilever has direct access to consumers via a network of more than four hundred warehouses and twenty-five million retail stores. Among direct-to-consumer channels, Unilever brands and products are served in: hypermarkets. wholesalers and cash and carry. Besides this, Nestle Pakistan and Procter & Gamble also have its own distribution channels. Innovation and R&D (CSF 5): I have given rating of 4 to Nestle company higher than Unilever and P&G because Nestle is doing innovation. Khyber Pakhtunkhwa, World Bank Group and Nestlé Pakistan join hands for responsible tourism in the province. Along with Nestlé Pakistan introduces paper straws across ready-to-drink products, eliminates 400 million plastic straws. Emerging market Penetration (CSF 6): Emerging market Penetration means to sell existing products in existing markets. So Unilever Pakistan sells their products in its existing markets, But Nestle Pakistan Explores its new markets to sell their products in a new market. That’s why I have given the higher rating to Unilever than Nestle. Stage 2: Matching Stage SWOT Matrix: SWOT Matrix: Opportunities: Hygiene Consciousness Increasing Population Innovation(R&D) Product Diversification Explore New Markets Strengths: Weaknesses: Largest Producer Advance Technology Supply Chain Management Financial Backing Experienced Top Management Tall Organization Structure High Operating Expenses High Production Cost Long term Strategies Emphasize on a few Products SO Strategies WO Strategies • • • Threats: Product smuggling Increase demand for Antibacterial Soaps Counterfeit Products International Trends Local Competition Create awareness between customers about hygiene. Accommodate rural demand by your supply network. Launch new products for lower class. ST Strategies • • • WT Strategies • Control Cost Accommodate local demand by joint ventures. Create new markets and new segments. Reduce high operating expense and cost of production for strong position against competitors Space matrix: Financial Position Net income increased by almost 40% Net sales increased by almost 12% ROA increased by 5.60% (2019-18) Earnings per Share Cash flows Average Rating +4 +6 +5 +3 +2 +4 Industry Position Consumption oriented culture Increase in Raw material cost Barriers to entry Growth Potential Financial Stability Average Rating +3 +2 +4 +6 +5 +4 Competitive Advantage Customer Loyalty Control over supplies and distribution Market Share Product Quality Product Life Cycle Average Rating -3 -4 -1 -2 -3 -2.6 Environmental Stability Technology Competition Inflation Law and order situation Substitute Average Rating -1 -2 -6 -5 -3 -3.4 X axis: IP+CA = 4+(-2.6) = 1.4 Y axis: FS+ES = 4+(-3.4) = 0.6 Graph: Aggressive Quadrant: Integrating Strategies (Backward, Forward and Horizontal Integration), Intensive Strategies (Market Development, Product Development, Market Penetration) and Diversification (Related or unrelated) are best strategies in this position. The following actions would be potential options for a Unilever Pakistan in this position: • • • • Focus on products that can really compete with other businesses A focused marketing campaign to gain a larger market share Focus on offering the lowest price compared to competitors Look for potential companies to take over and increase the market share BCG Matrix: Relative Market Share High Medium 1.0 0.5 Low 0 High +20 Star Question Mark Cash Cow Dog Medium 0 Industry Growth Low -20 Company Name Revenue Profit Percent Profit Industry Growth 18% Relative Market Share 0.1 Unilever Pakistan Nestle Pakistan 13,291,424,000 2,452,938,000 115,962,473,000 7,354,467,000 6% 8.72 11.65% 11.65% Unilever Pakistan falls in Question mark quadrant in BCG matrix. Companies in Question Marks Quadrant have a low relative market share position, yet they compete in a high-growth industry. Generally, these firms’ cash needs are high and their cash generation is low. These businesses are called question marks because the organi