Unilever History

• 1930, Merger of Margarine UNI & Lever Brothers.

• One of the largest companies in the world, more than 500 operating companies
in 80 countries.
• .75 Million Employees worldwide

Unilever Pakistan
• 1958, Established in Rahim Yar Khan, in mid 60s its head quarter shifted to
Karachi.
• 1988 Unilever purchased Lipton Tea.
• 1994, Unilever set up Wall’s Ice cream.
• 1997, Purchased Brook Bond Ltd.
• 1998, acquired polka ice cream.
• 2004, Sold Blue band Margarine & Dalda.
• Annual Sales= 20 Billion+ Number of Employees=2500 approx. Turnover
rate= 5%
Male to Female Ratio=8%
Functions at Unilever
Distribution Management At Unilever

World Wide office

London

R Asia Office
e World Wide Hierarchy
Singapore

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s
Distribution Management At Unilever

Multan
Region

T
E
Bahawalp R Raheem
Multan 1 Multan 2 D.G.Khan Vehari
ur R Yar Khan
I
T
O
R
I
E
S
Distribution Management At Unilever
Organization of Management
(Multan Region)
Multan 1 (Mahmood Territory)
Regional Manage
Mr. Salim Khan

Area Manager Multan 1

Sheikh Muhammad Younis

Multan 1 Territory covers 70% of urban area and Khanewal, Mian Chunnu,
Shujabad, Jalalpur, Qadirpur Raan as well. There are Approximately 4000 large
and small retailers under Multan 1 Territory.
Distribution Management At Unilever
Organization of Management
(Multan Region)
Multan 2 (Masood Territory)
Regional Manage
Mr. Salim Khan

Area Manager Multan 2

Zia ul islam Hashmi

Multan 2 Territory covers 30% of urban area and M.Garh, Mailsi, Band Bosann
as well. There are Approximately 2000 big and small retailers under Multan 2
Territory.
Distribution Management At Unilever
Marketing Channel Level

Manufact
urer

2 Level
Marketing
Channel
 Types of Distributors

Gold Customer / Power Distributor

• Mode of Payment is Check, the distributor is bound to keep 200 signed checks at
the head office.
•Distributor places the order at the head office, head office makes a fax to the
manager at warehouse to make the delivery.
•Before the delivery the signed check of the distributor is filled with the amount of
the delivery and is sent to the bank.
•The Gold Customer has over draft account at the bank. In case , if the check
bounces due to insufficient amount at the bank, the bank immediately provides up
to Rs. 10 Million to the company.
•In the event of check bouncing, warning is given to the distributor, if she exercise
this ill practice again, its Gold distribution is cancelled and is converted to DD
distribution ship.
•Gold Customers use a computerized programmed name as ULTRA, Unilever Trade
Resource Automation. All the record of inventory is kept at ULTRA, whenever the
stock is received and delivered by the distributor, all the record in the ULTRA is
updated and is being monitored by the company at the head office at the day end.
 Types of Distributors

Demand Draft Distributor

• Here the mode of payment is Demand Draft, rest is same as Gold Distribution
ship.

Static Distributor
• The mode of payment is Demand Draft.
• The company doesn’t have any sort of inventory record, they are not given the
sales target as the Demand Draft distributor.
 Figures
Territories
All the six Regions are divided into 30 areas, each area is further divided into
territories. Multan region is divided into 25 territories and 35 Territory managers
are working at these 25 territories. DG Khan is one of the area from 30 total
areas. And this area divide into 05 territories and 29 Distributors working in this
area. which are being dealt by 5 territory managers.
Distributors
Currently Unilever Pakistan limited has round about 83 distributors under Multan
region
Retailers
More or less 7000 retailers are being covered by Multan Region
Sales
At Masood&Co average sales per month is 22 tons. In rupees it becomes approx.
Rs. 190,00,000.
Profit Margin
Distributor’s Profit margin on average is 4% at all SKU’s whereas Retailer earns 7%
on average.
 Criteria for Selecting Distributors
Distributors are sought by the company on the basis of Town, its population,
Market potential, Sales potential etc and following characteristics

Goodwill

Good Financial Health

Experience

Good Reputation

Market Grip
 Physical Distribution System
Warehousing
Unilever Pakistan has various sales depots located in different cities throughout
the country such as:
Faisal
Faisal Abad
Abad

Karachi
Karachi

Wazir
Wazir Abad
Abad

Lahore
Lahore

Rahim
Rahim Yar
Yar Khan
Khan (Central)
(Central)

Rahim
Rahim Yar
Yar Khan
Khan (South)
(South)

Dera
Dera Ismail
Ismail Khan
Khan

Multan
Multan (Laar)
(Laar)
 Physical Distribution System
Warehousing
•Multan Region is getting its supply from Laar (15 km from Multan) and Rahim
yar Khan (Central) warehouses.
•Unilever doesn’t make assets in Pakistan, therefore all the warehouses are
private.
•Multan 1, Multan 2, Vehari and D.G.Khan are being facilitated by Laar depot.
•Unilever appoints a Depot manager which is responsible get and then make the
deliveries and maintain check and balance.
•There is a C&CD ( Customer and Channel Development ) Department at the
head office Karachi. Which is responsible to manage the stock and at each
warehouse.
•Another process is used at warehouse which is termed as DBR ( Demand Based
Requirement ). Depots are required to maintain at least one and half week of
 Physical Distribution System

stock which depends on number of dispatches. At Laar depot Stock arrives 3

times a week.
 Physical Distribution System
Transportation
• From Factory to Depot and from Depot to Distributor, mode of transportation is
Container.
• Unilever is in contract with a private firm named “ Aqib Brothers ” which is
responsible for all its transportation of finished inventory and raw material as
well.
• From Depot to Distributor, all the transportation and loading & unloading costs
are born by the company.
• From distributors to retailers and wholesalers both company and distributor
share the cost on equal terms.
• Modes of transportation from Distributor to Retailers are; Shehzore, Suzuki Pick
Up.
• Each Carton weigh 10 Kg and wages to labor are paid by 50 paisa per carton.
 Physical Distribution System
Material Handling
• Inventory is kept under controlled temperature and in cross ventilated
warehouse.
• Wood Palates are installed on the floor and cartons are stacked up on it.
• Each carton weigh up to 10 KG.
• Cartons are stacked up according to the nauture of the product. For instance,
for Lifebuoy soap 8 cartons are stacked up.
• Hands are used for picking and dropping of cartons, no such machinery is
involved.
Physical Distribution System
Inventory Management
• Inventory is delivered to the distributor from the warehouse thrice a week (on
each alternative day).
• The distributor holds safety stock of one and half week.
• For better control of inventory and to keep the distributor away from stock out
Unilever Pakistan has recently introduced ULTRA ( Unilever Trade Resource
Automation ) a computerized program which alerts the firm at its head office that
how much inventory is left behind at the warehouse of distributor and shows that
how much stock is available and how much is required.
• The firm uses FIFO method as the delivery system.
•The firm also uses conventional DBR (Demand Based Requirement) system.
Physical Distribution System
Order Processing
Order Booking
Sales Rep of the company goes to each and every retailer in its configured
territory, notes down the order on HHT (Hand Held Terminal), the very next day
delivers the ordered inventory with the invoice and collects the payment.
On Spot Sale
DSR with the stock in van, goes to each POP and sales out the products as required
by them.
On phone/Fax booking
Key Accounts like restaurants, wholesalers make the order on phone.
 Physical Distribution System
Order Processing
Procedure
• First of all number of outlets (POP)are kept into consideration and their type &
category.
• Territory manager makes the PJP of each and every POP.
•Then a schedule is made in which number of DSR, Van drivers POPs to be visited,
and frequency of visits are stated.
• At Masood Territory, daily 35-45 POP’s are visited and in a JC almost all the 2000
POP are covered.
• At larger POP visits are thrice a week and on regular POPs only one visit a week
is sufficient.
• Sales person for Beverage and HPC are separate.
 Physical Distribution System
Order Processing
Number of DSRs
22
22 DSR
DSR 30
30 DSR
DSR

-12 HPC -17 HPC

-12 Beverages
HPC -17 Beverages
-06 HPC
-06 -06 Delivery
-07 BeveragesMan
-06 Delivery
-04 BeveragesMan -07 Delivery Man
-04 Delivery Man

Mehm
Masoo
ood &
d & CO
Co
Suggestions:
Up to our investigation and deep insight into Unilever’s channel management
system, it is quite systematic and to some extent optimal. Nonetheless it needs
some improvements regarding the authority of its area and territory manager.
Unilever gives an open hand authority to its territory managers that they
can even snatch the distribution ship from any distributor if it is not up to
company requirements. This may create bias as the salary package of the
territory manager is not considered to be a sizeable sum, so if he has some sort
of concerns with the distributor over not meeting the company standards, he
may provide positive report to the company about distributor by getting some
favor in monitory terms from the distributor. Unilever must combat this
negligence.