Unilever Limited Case Study: Know the Firm Structure

FMCG Giant Unilever Limited Case Study: Forbes Number #1 Company

If you have stepped into a grocery store and bought personal care or pre-packaged food item, chances are you have bought a Unilever item. Unilever is a multinational consumer goods company, with over 400 brands under their belt. While Unilever has both Dutch and British origin, its current owner is British, with headquarter being in London, England.

Here’s a birds-eye view of what Unilever is about and how it works:

Unilever: Origin

On 2nd September 1929, the Dutch company Margarine Unie and soap maker Lever Brothers merged to form Unilever. The name Unilever is a portmanteau of the original company names; ‘Uni-’ from Margarine Unie and ‘-lever’ from Lever Brothers. Before the merger, Lever Brothers were renowned and in-demand soap makers. They launched Lifebuoy in 1894 and Vim in 1904. They also acquired the popular soap company Pears Soap in 1917. It can be said that with the merger with Margarine Unie, they were finally taking a massive leap into the food industry. In 1930, the US giant Procter & Gamble also entered the British market, becoming the primary competition of Unilever.

Unilever: History

• In 1930, Unilever acquired United Africa Company.
• In 1931, Unilever entered the Indian market with Hindustan Vanaspati Manufacturing Company, followed by Lever Brothers India Limited (1933) and United Traders Limited (1935)
• In 1967, the Unilever U became their corporate logo.
• In 1971, Unilever acquired Lipton International, becoming one of the largest tea producers in the world.
• In 1973, they acquired Frigo, the famous ice cream brand from Spain.
• In 1978, Unilever acquired National Starch, solidifying its presence in the US.
• In 1984, Unilever acquired UK’s best selling tea brand, PG Tips.
• In 1986, Unilever acquired Cheseborough-Pond’s, entering the US skincare market.
• In 1989, they acquired Calvin Klein
• In 1992, Unilever entered the Czech Republic and Hungary and established UniRus in Russia.
• In 1997, they acquired the Kibon ice cream brand in Brazil.
• In 2000, they acquired popular brands such as Bestfoods, Slim-Fast Foods, Ben & Jerry’s, and Amora Maille of France.
• With the acquisition of Bestfoods, they had also acquired the brand Knorr.
• In 2010 they acquired Alberto Culver bringing in brands like RESemmé, Alberto VO5, Nexxus, St. Ives and Simple.
• In 2020, they acquired GSK Consumer Healthcare Limited in India, bringing their Health Food Drinks portfolio like Horlicks and Boost.

Unilever: Core Values and Business Strategy

Unilever claims its core value is to make “sustainable living commonplace”. They want to do ‘more good’ for the environment and not ‘less harm’. A few of their strategic choices in doing so has been:

• Developing their portfolio in high-growth areas like “hygiene, skincare, premium beauty, plant-based foods and functional nutrition such as vitamins, minerals and supplements.”
• Their aim is for their brands to be a force of “good”. And improve the health of both the planet and its citizens.
• Accelerate in key growth markets such as India, the USA, and China.
• Lead the momentum towards developing channels, such as eCommerce and the new eB2B platforms.
• They believe in developing an inclusive and diverse organization, something they believe is crucial for their “purpose-led” and “future-fit” vision.

Unilever: Brands

Some popular brands and products launched or acquired by Unilever.

• 1894- They (Lever Brothers) launched the popular soap brand Lifebuoy.
• 1904- Vim was launched.
• 1917- Pears soap was acquired by them.
• 1954- They launched the popular shampoo brand Sunsilk.
• 1955- Dove soap bar is launched in the US.
• 1965- Popular cleaning brand Cif is launched in France for the first time.
• 1972- They launch Impulse deodorant for its pilot run in South Africa.
• 1983- Axe Body Spray was first launched in France
• 1985- Clearblue home pregnancy test, first of its kind ever released in the market.
• 1989- Magnum, a premium ice cream brand first introduced in Germany.
• 1989- They now own Ponds and Vaseline.
• 1993- Organics Shampoo, a famous shampoo brand first sold in Thailand.
• 2000- Unilever now owns the famous food brand Knorr.
• 2010- Unilever now owns brands like TRESemmé and Simple Skincare.
• 2018- Love Beauty and Planet is launched in July, their newest personal care launch in 20 years
• 2020- Unilever acquired Horlicks and Boost.

Unilever: Competitors

For comparison: Unilever’s revenue is $63.1B, and it currently employs 148,949 people. The current CEO of the organization is Alan Jope.

Unilever: Controversies

• In 2001, a mercury thermometer factory run by Unilever in South Indian town Kodaikanal was shut down. They were found illegally dumping contaminated mercury waste in the populated parts of the town.
• In 2008 and 2014, the UK based NGO Greenpeace criticized Unilever for the deforestation it was causing in Indonesia to obtain Palm oil.
• In 2019 Unilever was ranked as one of the top ten plastic polluters by BreakFreeFromPlastic.
• In July 2016, Unilever was accused of selling salmonella infested cereal in Israel. Despite reassurances by the company of the contrary, the situation kept escalating. On 8th August 2016, the Israeli Health minister suspended Unilever’s manufacturing license until they carried out corrective actions.
• Two class actions were filed against Unilever in Israel for misleading the public and hiding the contamination.
• Unilever has been criticized multiple times for selling skin whiteners in south Asian countries like India, Sri Lanka, Bangladesh, etc.

Unilever: Environmental and Philanthropic Measures

• In 2004, Unilever became the founding member of Roundtable on Sustainable Palm Oil (RSPO).
• Unilever pledged to source their teabags ethically and from Rainforest Alliance Certified™. By 2010 all Lipton tea bags were similarly sourced.
• By 2010, Unilever is named sustainability leaders by Dow Jones Sustainability Indexes.
• In 2013, Unilever was the recipient of the Catalyst Award for its initiatives in expanding opportunities for women and other businesses.
• In 2015, Unilever claims they achieved their target of sending zero non-hazardous waste into the landfills from their factories.
• In 2017, Unilever committed to using 100% recyclable plastic by 2025.
• In 2020, they contributed more than €100 million for COVID relief and also donated products like soaps and sanitizer.

Hindustan Unilever Limited

Unilever officially entered the Indian market in 1931 with Hindustan Vanaspati Manufacturing Company. And they have had an uphill journey in the country ever since. In 1994, they became the largest private sector company in India after a merger with Brooke Bond Lipton. In 2007, Hindustan Lever officially became Hindustan Unilever Limited (HUL).

They are still going strong, and in 2017, they were ranked No 1 in India on the Forbes list of The World’s Most Innovative Companies.