REPORT OF STRATGIC MANAGEMENT

At

Unilever Pakistan

Presented to

Prof, Dr Massod ul Hassan

In partial fulfillment of the requirements for this subject

By
Abdur Rehman BAFM 14-24

DEPARTMENT OF COMMERCE
BAHAUDDIN ZAKARIYA UNIVERSITY
MULTAN

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 Acknowledgement

We would like to pay our praises and humblest thanks to AL-MIGHTY Allah, the most merciful

and beneficent. It gives us immense pleasure and honor to extend our thanks to our kind &

cooperative Sir, Dr. Masood-ul-Hassan, who always motivate us to work hard.

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 Executive Summary

"Strategy is the determination of the basic long-term goals of an enterprise, and the adoption of

courses of action and the allocation of resources necessary for carrying out these goals."

This report is all about the Strategies of Unilever. For this purpose, ten different matrices have

been filled according to their requirements, so we can adopt different courses of action for

carrying out the goals of Unilever.

Unilever, a leading multinational corporation has multifarious brands that inherent consumer

products on a large scale and involve in manufacturing gigantic operating in hundred countries

all over the world. Unilever has been moved by the significant circumstances of the day like

economic boom, rapid change in technology, depression, people's lifestyle, and recession.

Unilever has been operating in Pakistan since 1948. Unilever has five laboratories all over the

world, which scrutinize new techniques to make more improve. Unilever's purpose is to set the

highest standards of organizational behavior including everyone they work with.

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 Table of Contents

Introduction of Unilever Ltd. 4

Mission Statement 5
Vision Statement 5
What They Do? 5
Input Stage 7
SWOT Analysis 7
IFE Matrix 9
EFE Matrix 10
CPM Matrix 12
Matching Stage 13
SWOT Matrix 13
SPACE Matrix 14
IE Matrix 16
Grand Matrix 17
BCG Matrix 18
Decision Stage 19
QSPM Matrix 19
Conclusion & Recommendations 21
References 22

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 INTRODUCTION OF UNILEVER Ltd.

Unilever is one of the world’s leading suppliers of fast moving consumer goods (FMCG) across
Foods and Home and Personal Care categories. Unilever’s portfolio includes some of the world’s
best known and most loves brands.

Unilever Pakistan Ltd.

Unilever Pakistan (70.4% Unilever equity) is the largest FMCG company in Pakistan, as well as
one of the largest multinationals operating in the country. Unilever Pakistan Ltd. a subsidiary of
the Unilever Group is operating in Pakistan since 1948. The company’s main business lines are
Soaps and Detergents, Personal Products, Cooking Oils and Fats, Packed Teas and Ice Creams.
Unilever has a long list of brands such as Surf, Vim, Rin, Lifebuoy, Sunlight, Lux, Rexona, Sunsilk,
Closeup, Blue band, Dalda, Planta, Lipton’s Yellow Label, Taaza and Richbru, Brook Bond’s
Supreme and Kenya Mixture etc. which are common household names in Pakistan. The
Company’s factory at Rahim Yar Khan was one of the industrial units to be constructed after the
creation of Pakistan. As the consumer base expanded over the years and the company entered
into new product lines like Personal Products and Margarine, it invested further in the installation
of modern manufacturing facilities including a factory at Karachi. Today, the Company is using
latest state of the art technology for producing high quality products. In 1995, the Company
established a new factory near Lahore to manufacture the Wall’s range of ice creams, which have
become popular within a short time. In 1996, the present group – Unilever UK acquired the Polka
Group that produced ice creams.
In 1999, Pakistan industrial promoters (Private) Limited, owners of “Polka” brands of
Ice Cream were merged with Lever. In order to leverage the synergies of Unilever’s
international brand strength, market edge and corporate image, Lever Brothers
Pakistan Ltd. changed its name to Unilever Pakistan Ltd. in August 2002.
The company had a turnover of Rs. 23.3 bn (Euro 309 mn) in 2007, 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.
Accountable to our stakeholders
Since the time Unilever Pakistan began its operations in 1948, 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.

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Vision Statement:
We meet every day needs for nutrition, hygiene and personal care with brands that help people
feel good, look good and get more out of life

Mission Statement:
• We are aimed to be leading products company in Pakistan, a multinational with deep
roots in the country.
• We will attract and develop highly talented people, who are excited, empowered and
committed to deliver double-digit growth.
• We are committed to serve the everyday needs of all consumers everywhere for foods,
hygiene and beauty through branded products and services that deliver the best quality
and value.
• We strive to remain an ever simple and enterprising business.
• We will use our superior consumer understanding to produce break through innovations
in brands and channels.
• Through managing a responsive supply chain, we will maximize value from Suppliers to
Customers.
• We want to be exemplary through our commitment to Business Ethics, Safety, Health,
Environment and involvement in the Community.

WHAT THEY DO
At present they market a host of household products named under the following brand names
and product groups.

1.HOME CARE:
• Personal Wash (PW):
Toilet Soaps Lifebuoy, Lifebuoy Gold (2 variants), Lux (in 5 variants), Rexona (in 3 variants), Breeze,
Sunlight Bar.
• Laundry Care:
Surf Excel, Sunlight washing powder, Sunlight bar, Wheel washing powder
• House hold Care:
Vim dish wash bar, Vim scourers Magic bar
2.PERSONAL CARE:
• Hair Care:
Sunsilk Shampoo (4 variants), Lifebuoy Shampoo
• Skin Care:
Fair & Lovely skin cream, Ponds
• Dental Care:
Close up tooth paste (3 variants), Pepsodent

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3.FOOD & REFRESHMENT CATEGORY

• Cooking products:
New Dalda, Dalda Cooking Oil, Dalda Sunflower Oil, Planta Cooking Oil, Crisp ‘N’ Dry, Dalda Lajawab
• Spreads:
Blue Band
• Leaf Teas:
Lipton Yellow Label, Yellow Label-Danedar, Richbru, Top Star, Taaza Leaf, Laojee, Brook Bond Supreme,
Red Label-Danedar, BB Tips, A-1, Tiger
• Dust Teas:
Pearl Dust, Kenya Mixture, Red Rose

We are going to conduct our project in three stages:

INPUT STAGE:
• SWOT analysis
• IFE matrix
• EFE matrix
• CPM matrix
MATCHING STAGE:
• SWOT matrix
• BCG matrix
• SPACE matrix
• GRAND matrix
DECISION STAGE:
• QSPM

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 INPUT STAGE
SWOT Analysis

Strengths:

• Customer’s Loyalty.
• Latest state of the art facilities and technology for producing high quality products.
• International brand strength.
• Committed to business ethics, safety, health, environment and community.
• UNILEVER’s key competitive advantage over other market participants is the retail reach
of the company. UNILEVER services 500,000 outlets with 50% through direct distribution
and remaining via wholesalers.
• UNILEVER is enjoying market edge of 41% in FMCG industry. UNILEVER is at number one
in ice cream segment and having 14% market share all over the globe.
• 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.
• UNILEVER Pakistan Limited is the only company in Pakistan which has its own corner
research department.9

Weaknesses:

• The biggest challenge in safeguarding market position is to become cost leader.

• Operational complexity due to a large number of products in portfolio and due to
diverse work force.
• Strategic alliance with other small mills for manufacturing purpose is the weakness as well
as a threat for UNILEVER. Although UNILEVER claims that it is a part of its cost reduction
strategy but cannot hide the reality that it shows weakness of UNILEVER.
• Due to tall structure it is difficult to handle the organization easily.
• No doubt its sales are large but in same time its operating expenses are huge.
• 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
• 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
• Emphasizing only few products while ignoring others which could give them potential
market shares e.g. beverages section.

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Opportunities:

• Markets of developing countries can be proved a profitable segment because people are
consumption oriented rather than saving or investment oriented.
• UNILEVER can gear up its market share in the untapped rural market.
• Diversification in unrelated business.
• Rapid increase in world population. World population is set to grow by 800M in 2010 and
almost all increase will be in developing countries.
• 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.
• As population is increasing it may lead to create valuable opportunity to enhance the
growth of UNILEVER.
• Innovation in UNILEVER may create opportunity to more penetrate in the market.
• 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.
• Unilever Pakistan has opportunity to develop new markets by identifying the needs of
customers

Threats:

• FMCG market is highly responsive to economic conditions, inflation and social disruptions
resulting in variation in sales revenues and demand for the company.
• P&G is the major competitor and threat for UNILEVER. Other organized players are Nestle
and R&B.
• UNILEVER is facing intense competition from unorganized players i-e cheaper smuggled
products and Chinese products. According to industry source, 40% of tea consumed
locally and a large portion of HPC products are smuggled into the country.
• Legal, political and regulatory factors of host country. For example, supportive
Government policies for attracting FDI, 1% tax rate on corporate profit and inability of
Pakistan Government to control smuggled products etc.
• Although UNILEVER has a first mover advantage in ice cream segment but Engro has
announced to enter in ice cream segment and is considering a big rival post CY 2010.
• Rapid increase in raw material cost and supply disruptions from suppliers of raw material.
The unprecedented surge in palm oil, tallow prices and other materials has resulted in
declining margins. Going forward, high raw material costs area key risk to UNILEVER’s
profitability.
• 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 10

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 IFE Matrix
Justification of ratings:

On strength side:

• Customer’s loyalty is not a hidden fact in UNILEVER case. People have developed and
adopted the taste of UNILEVER’s high quality products and there is no comprise on
quality. 150 million times a day, in 150 countries, people use UNILEVER’s products at key
moments of their day.
• Micro marketing in developing countries. UNILEVER services 500,000 outlets with 50%
through direct distribution and remaining via wholesalers.
• UNILEVER’s continuous expansion and its large market share indicate their strength in
latest facilities and quality management. UNILEVER has ISO certification.
• Its brands are enjoying international recognition. UNILEVER is serving almost 150
countries.
• UNILEVER is concerned about its customers as well as employee. There are strict safety
standards for employees and visitors of plants too.

On weakness side:

• Although UNILEVER claims that strategic alliance with small firms for manufacturing
purpose is the part of its reducing cost objective but if we look at the other side of the
picture, strategic alliance is a weakness as well as threat for UNILEVER. For example, Asad
Soap Factory is manufacturing soap for UNILEVER Rahim Yar Khan, and now Asad Soap
Factory is searching for buyers of soap plant.
• UNILEVER’s products are costly as compare to local producers. Although costly goods are
not posing any big threat to UNILEVER but in long run it can be proved harmful for
company. So, company is responding greatly towards covering its weakness. For this
purpose, company has adopted policy of contractual hiring, strategic alliance etc.
• UNILEVER has a large number of products in its portfolio. It means that UNILEVER has a
large number of SBU’s to control. It adds operational complexity to UNILEVER’s
operations.

Strengths Weight Rating Weighted Score

1 Customer’s Loyalty. 0.10 3 0.30
2 Micro level retail outlets 0.08 4 0.32
3 Latest state of the art facilities and technology. 0.07 4 0.28
4 International brand strength. 0.06 3 0.18
5 Market share of 41% 0.06 4 0.24

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 6 Committed to business ethics, safety, health, environment and
0.05 3
community. 0.15
7 Financial Backing 0.05 3 0.15
8 Experience Top Management 0.04 4 0.16
9 Supply Chain Management 0.04 3 0.12
10 Number of Products 0.03 3 0.09

Weaknesses Weight Rating Weighted Score

1 Strategic Alliance 0.08 1 0.08
2 Costly Products 0.05 2 0.10
3 Operational Complexity 0.05 2 0.10
4 Tall Organization Structure 0.04 1 0.04
5 High Operating Expenses 0.04 2 0.08
6 High cost of production 0.04 1 0.04
7 Long term strategies 0.03 1 0.03
8 Emphasizing only few products e.g. beverages section 0.03 1 0.03
9 Indirect distribution network 0.03 2 0.06
10 Many protests by labor unions 0.03 1 0.03
Total IFE Score 1.00 2.58

EFE Matrix
Justification of ratings:

On opportunity side:

• It is a general observation that people of developing countries like Pakistan are

more inclined towards consumption rather than saving and the major portion of
spending is on FMCG.
• World population is increasing at an alarming rate. World population is set to grow by
800M in 2010 and almost all increase will be in developing countries. And increase in
population leads to increase demand of FMCG sector.
• Like Engro, UNILEVER can enter in unrelated areas of production.
• The under penetrated rural market offers tremendous growth potential as rural
population constitutes around 60% of the total population. In the past few
years, favorable structural changes, such as double-digit growth in agricultural
credit, increased penetration of television cable media have boosted demand for
FMCG products. Following table shows that rural population will be almost 50%
of total population in near future.

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On the threats side:

• P&G with 50% market share is a big threat for UNILEVER. Nestle with roundly 30% market
share is also posing a threat in near future. Engro is planning to enter in ice cream market
and a future rival in ice cream as well.
• Rapid increase in inflation rate can increase the prices of products and hence can reduce
demand.
• Smuggled products swallow a big part of profits of UNILEVER every year. Almost 40% tea
and 29% shampoo used in Pakistan is smuggled from Afghanistan and China.
• Economic system of host country and rapid increase in raw material cost are last two
major threats for UNILEVER.

Opportunities Weight Rating Weighted Score

1 Market of developing countries due to more tendency towards
0.10 4
consumption 0.4
2 Rapid increase in world’s population 0.06 3 0.18
3 Unrelated diversification 0.05 4 0.2
4 Rural area 0.05 2 0.1
5 Hygiene Consciousness 0.04 1 0.04
6 Innovation (R&D) 0.04 4 0.16
7 Exploring new markets 0.04 3 0.12
8 Could seek better supplier deals 0.03 4 0.12
9 Support core business economies 0.03 4 0.12
10 Could develop new products 0.02 4 0.08

Threats Weight Rating Weighted Score

1 Competition from organized players, P& G 0.09 2 0.18
2 Inflation Rate 0.07 2 0.14
3 Smuggled products and local competition. 0.07 2 0.14
4 Legal, political and regulatory factors of host country. 0.06 2 0.12
5 Rapid increase in raw material cost 0.06 1 0.06
6 Increased demand for antibacterial soap 0.06 1 0.06
7 Counterfeit products 0.05 4 0.20
8 International trends 0.03 2 0.06
9 Local competition 0.03 2 0.06
10 High taxation 0.02 3 0.06
Total EFE Score 1.00 2.60

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 CPM Matrix
The Competitive Profile Matrix (CPM) is a tool that compare the firm and its rivals and reveals
their relative strength and weaknesses. In order to better understand the external environment
and the competition in a particular industry, firm often use CPM. The matrix identifies a firm key
competitor and compares them using industry critical success factors. The analysis also reveals
company relative strengths and weaknesses against its competitors, so a company would know,
which areas its should improve and, which areas to protect.

Benefits of CPM:

• The same factors are used to compare the firm. This makes the comparison more
accurate.
• The analysis displays the information on a matrix, which makes it easy to compare the
companies visually.
• The result of the matrix facilitate decision making. Companies can easily decide which
areas its should improve and, which areas to protect.

Justification:

Here we make a CPM of Unilever Pakistan with their most competitors P & G and Nestle. We take
12th critical key factors and compare with competitors. We assign weights and ranking according
their performance and after detail analysis of financial reports. Unilever Pakistan gain high score
3.66 against their competitors P & G take 3.03 and Nestle 2.93. The difference is no high which
shows they are the strong competitors of each other. Key factors are given in matrix which is
given below.

Unilever P&G Nestle

Critical Success Factors Weight Rating Score Rating Score Rating Score
Advertising 0.10 4 0.40 3 0.30 2 0.20
Market Penetration 0.06 3 0.18 2 0.12 2 0.12
Customer Service 0.08 4 0.32 3 0.24 3 0.24
Store Locations 0.06 3 0.18 3 0.18 3 0.18
R&D 0.10 4 0.40 3 0.30 3 0.30
Employee Dedication 0.06 4 0.24 2 0.12 2 0.12
Financial Profit 0.09 4 0.36 3 0.27 3 0.27
Customer Loyalty 0.07 3 0.21 3 0.21 3 0.21
Market Share 0.06 3 0.18 3 0.18 3 0.18

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Product Quality 0.15 4 0.60 4 0.60 4 0.60
Top Management 0.08 4 0.32 3 0.24 3 0.24
Price Competitiveness 0.09 3 0.27 3 0.27 3 0.27
Totals 1.00 3.66 3.03 2.93

MATCHING STAGE

SWOT Matrix
Proposed Strategies:

• UNILEVER can capture untapped rural markets and markets of d e ve lo p in g

n a t io n s b y u sin g it s st at e o f t h e a rt f a c ilit i e s & technology. International
brand strength is plus point which will be proved helpful while positioning.
• UNILEVER’s Commitment to business ethics, safety, health, environment and community
can be proved helpful in order to satisfy hygiene conscious customers. UNILEVER should
focus more on quality of goods.
• Unrelated diversification is a risky decision to be taken. Loyal customer is the
major power to cope up with after effects of this decision.
• Customers in rural areas and in developing countries usually have low income
level. UNILEVER should reduce its costs in order to capture that uncovered markets
effectively.
• UNILEVER can use its international brand strength and wide network of retail outlets in
order to compete with organized and unorganized players of market.
• Strategic alliance is showing the weakness of UNILEVER in particularly manufacturing area
which the competitors do not hold. UNILEVER should increase its production capacity in
order to compete in market and to reduce competitor’s threat.
• If UNILEVER can obtain cheaper raw material, it can reduce cost of goods manufactured.

SO Strategies
1 Discover new markets (O1, O2, O4, S4, S3)
2 New quality products (O3, O5, S3, S6)
3 Unrelated diversification (O3, S1)
4 Create awareness among customers about hygiene.

ST Strategies
1 Vertical Integration (T1, T3, S2, S4)
2 Control Cost
3

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 4

WO Strategies
1 Market Expansion in rural areas (O4, O1, W2)
2 Initiate catering new markets and new segments
3 Accommodate local demand by joint ventures
4

WT Strategies
1 Increase in manufacturing capacity. (W1, T1).
2 Cost leadership (W2, T5)
3 Make creative and competitive strategies
4

Space matrix
SPACE matrix indicates whether conservative, aggressive, defensive and competitive strategies
are more appropriate for given organization. The matrix shows that UNILEVER has Aggressive
Strategy which means that it has a strong competitive position in the market with rapid growth.
It needs to use its internal strengths to develop a market penetration and market development
strategy. Other possible strategies include product development, integration with other
companies and diversification.

• Company should use Product Development to increase sales by slightly

modifying its products. It would eliminate its threat from unorganized market
competitors which are selling smuggled items and hurting the market of UNILEVER quite
badly. Following are some factors that prove why I choose this strategy for UNILEVER:
o UNILEVER’s existing products are very much successful across the globe. Its
41% market share shows the number of satisfied customers.
o There are rapid technological developments in FMCD industry.
o FMCG is a high growth industry. High growth is characterized by rapid increase in
demand due to some factors like increase in population etc.
o UNILEVER has both organized and unorganized rivals. Organized rivals are
competing by introducing comparable prices and unorganized rivals are hurting
UNILEVER by selling even at lower of the cost.

• Market development is another strategy suggested for UNILEVER, we’ve seen that
UNILEVER is producing high quality products and captured the maximum market share.
But still lots of lower and middle-income people are out of its use for most of the products
as they are highly priced. Rural area is also an untapped market for UNILEVER. UNILEVER

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must consider about producing low-price products as well, so company can earn
maximum share.

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 Internal External Matrix
The IFE matrix score for home care, personal care and food segment of UNILEVER is 3.1, 2.83 and
2.61 and for EFE matrix scores 3.0, 2.74 and 2.52 respectively, therefore our IE matrix falls
more around ‘v’ cell. The company should adopt HOLD & MAINTAIN STRATEGIES and I
recommend Market Development and Product Development for UNILEVER.
UN I LE V E R can in t ro d u ce e xi st in g p ro d u ct s t o n e w geographical area that are rural
markets and markets of developing nations. On the other hand, UNILEVER can also be modifying
its existing products and introduce variants in order raise its market share

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 Grand Strategy Matrix
The grand matrix helps us to determine the strategy that firm must pursue, based on
its competitive position and market growth. UNILEVER’s segments home care and personal care
lie in Q1 which represents excellent strategic position of these segments. For these segments,
continued concentration on current market and products is an appropriate strategy. UNILEVER
has abundant resources so, backward, forward, and horizontal integration also prove effective.

BCG Matrix

Interpretation
Star;
Home Care divisional products of Unilever Pakistan comes in this region as its shows best long
run opportunities for the growth and profitability. Its has high market share as well as high market
growth. Backward Forward Horizontal Market penetration Market development and Product
development strategies are suitable in this region.

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Question Mark;
Personal Care and Food & Refreshment division of Unilever Pakistan come in this region which
has low market share but yet high market growth. Cash needed is high and cash generation is
low. It up to the organization which strategy they adopt. Market development Market
Penetration Product development and Divestiture strategies are suitable for these divisions.

Cash Cow
No any division of unilever Pakistan comes in this sector. In this region market growth is low but
market share is high. Suitable strategies are Diversification Retrenchment and Divestiture.

Dogs;
Unilever Pakistan is a well known brand so no any single product comes in this region. In this
region both market share and market growth is low so our result show no single product comes
in this region which is a great advantage for the company. Diversification strategy is suitable in
this region.

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 DECISION STAGE

QSPM Matrix
Strategic Recommendations:

Appropriate strategy for UNILEVER is Market Development. UNILEVER should remain in the
present business and should introduce present products in new geographical area.

Following are necessary factors that are present, so we chose the 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 MNE in Pakistan. It has abundant resources both financial and
human, so it can easily expand geographically. Here we are not concerned about
expansion of operating activities to new geographical area. We are particularly concerned
about capturing untapped market. It is up to UNILEVER whether it decides to start
operating in new areas too or just introduce products by using its strong channel of
distribution.
• UNILEVER is operating globally. It means that FMCG is such an industry which can
be grown globally.

Market Development Product Development

Strengths Weight AS TAS AS TAS

1 Customer’s Loyalty. 0.10 3 0.30 2 0.20
2 Micro level retail outlets 0.08 4 0.32 1 0.08
Latest state of the art facilities
0.07 4 0.28 2 0.14
3 and technology.
4 International brand strength. 0.06 3 0.18 2 0.12
5 Market share of 41% 0.06 4 0.24 1 0.06
Committed to business ethics,
safety,health, environment and 0.05 4 0.20 2 0.10
6 community.
7 Financial Backing 0.05 3 0.15 1 0.05
8 Experience Top Management 0.04 3 0.12 1 0.04
9 Supply Chain Management 0.04 4 0.16 2 0.08
10 Number of Products 0.03 3 0.09 2 0.06

Market Development Product Development

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 Weaknesses Weight AS TAS AS TAS
1 Strategic Alliance 0.08 4 0.32 2 0.16
2 Costly Products 0.05 4 0.20 3 0.15
3 Operational Complexity 0.05 3 0.15 2 0.10
4 Tall Organization Structure 0.04 2 0.08 1 0.04
5 High Operating Expenses 0.04 4 0.16 1 0.04
6 High cost of production 0.04 3 0.12 2 0.08
7 Long term strategies 0.03 4 0.12 2 0.06
Emphasizing only few
products e.g. beverages 0.03 3 0.09 2 0.06
8 section
9 Indirect distribution network 0.03 3 0.09 1 0.03
10 Many protests by labor unions 0.03 3 0.09 2 0.06

Market Development Product Development

Opportunities Weight AS TAS AS TAS

1 Market of developing
countries due to more
0.10 4 0.40 2 0.20
tendency towards
consumption
2 Rapid increase in world’s
0.06 4 0.24 2 0.12
population
3 Unrelated diversification 0.05 3 0.15 1 0.05
4 Rural area 0.05 4 0.20 2 0.10
5 Hygiene Consciousness 0.04 4 0.16 1 0.04
6 Innovation (R&D) 0.04 3 0.12 2 0.08
7 Exploring new markets 0.04 4 0.16 2 0.08
8 Could seek better supplier
0.03 3 0.09 1 0.03
deals
9 Support core business
0.03 3 0.09 2 0.06
economies
10 Could develop new products 0.02 4 0.08 2 0.04

Market Development Product Development

Threats Weight AS TAS AS TAS

Competition from organized
0.09 3 0.27 2 0.18
1 players, P& G
2 Inflation Rate 0.07 4 0.28 2 0.14
Smuggled products and local
0.07 4 0.28 1 0.07
3 competition.
Legal, political and regulatory
0.06 3 0.18 1 0.06
4 factors of host country.

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 Rapid increase in raw material
0.06 3 0.18 2 0.12
5 cost
Increased demand for
0.06 3 0.18 2 0.12
6 antibacterial soap
7 Counterfeit products 0.05 4 0.20 1 0.05
8 International trends 0.03 3 0.09 1 0.03
9 Local competition 0.03 3 0.09 2 0.06
10 High taxation 0.02 4 0.08 2 0.04
TOTALS 6.98 2.82

Conclusion & Recommendation

After the analysis of the IEFM and EFEM, we see that the company is above average. With
respect to SPACE and GRAND matrix analysis, UNILEVER is placed in aggressive
quadrant and it can follow any of the strategies e.g. market penetration, forward
integration, backward integration etc. According to the analysis in QSPM, we would
like UNILEVER to pursue Cost Reduction strategy which is a market development
strategy. Although the current business strategy of UNILEVER is Product
Development as they are bringing different product like Green Tea in the market.
They are also modifying their products for e.g. Lipton in new round tea bags and Lux by
adding a different ingredient. Some recommendations are followings:
• Reduce packaging expense.
• Reduce international purchases of raw material cost as Unilever purchases 90% raw
material from international suppliers.
• Reduce retailer’s commission cost
• Reduce transportation cost
• Reduce inventory-holding cost

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 References
Annual Report of Unilever Pakistan 2016.

Butler, S. (2016, November 07). Price of 20 Unilever products up by average of 5.7% since Brexit vote.

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