Supply Chain Process

of

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 Term Paper
Supply Chain Management
ALD – 2201

Prepared by,

Jannatul Fardaus Ritu (17221007)

Tasnim Binta Sayed (17221015)
Ekhtear Ahmed (17221039)
Mayisha Tasnim Natasha (17221081)
Maria Nazifa (17221089)

Batch: 2017 (A)

Department of Business Administration in Finance and Banking

Supervised by,

Sharfuddin Ahmed Lisan

Lecturer, Supply Chain Management
Adjunct Faculty, BUP

Date of submission: November 4, 2018

This term paper is completed for the fulfillment of the course “Supply Chain Management” under
Faculty of Business Studies of Bangladesh University of Professionals

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 Letter of Transmittal

4 November, 2018

Sharfuddin Ahmed Lisan

Lecturer, Adjunct Faculty

Bangladesh University of Professionals.

Subject: Submission of the term paper report on “Supply Chain Process” of the firm named

“Unilever”.

Dear Sir,

With due respect we are reporting you the term paper you assigned us. We were chosen

the company “Unilever” to do this report on the process of supply chain. We have tried our

best to do the research of the assigned topic properly considering every trifle thing you

advised and completed the report in a fascinating way.

We, therefore, eagerly believe that this term paper report will meet your specification and

contentment.

Sincerely,
Jannatul Fardaus Ritu (17221007)
Tasnim Binta Sayed (17221015)
Ekhtear Ahmed (17221039)
Mayisha Tasnim Natasha (17221081)
Maria Nazifa (17221089)

Batch: 2017 (A)

Department of Business Administration in Finance and Banking

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 Statement of Authorship

We, hereby, state that the report we are submitting is entirely our authentic work. The report

has not been used other than the stated sources that marked which has been quoted either

literally or by content from the used sources. It’s assured that the contents or parts of it have

not been published in any report. We are aware of the regulations concerning plagiarism,

including those regulations concerning disciplinary actions those may result in plagiarism.

Any use of the work of any other author, in any form, is properly acknowledged at their

point of use.

Students’ Name:

Jannatul Fardaus Ritu (17221007)

Tasnim Binta Sayed (17221015)
Ekhtear Ahmed (17221039)
Mayisha Tasnim Natasha (17221081)
Maria Nazifa (17221089)

Batch: 2017 (A)

Department of Business Administration in Finance and Banking

Date of Submission: November 4, 2018

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 Acknowledgement

First of all, we would like to thank the Almighty Allah for whose kindness we have

managed successfully to complete the term paper report properly with a sound health.

Then, we would like to give the credit to our course teacher Sharfuddin Ahmed Lisan.

Without his proper guidance and techniques, it would be tough for us to complete the term

paper report in a proper way on time. We are also thanking him for giving us the opportunity

to choose a company. Actually, this ensured our dexterity that how we should co-operate

and involve ourselves in real case scenario.

Finally, we would like to thank our friends, seniors and most importantly different

secondary sources. Without the help of them, it was pretty tough to create the pattern and

accumulate important information in the term paper.

Thanks to all of you.

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 Executive Summary

Unilever Bangladesh Ltd. is a multinational company. They have been a major player in

Bangladesh FMCG market with its strong brands like Kisaan, Knorr, Quality walls, Brook

bond, Lipton, Bru etc. in Food & beverages division; Wheel, Rin, Surf Excel, Lifebuoy,

Dove, Sunsilk etc in Home & Personal care division. The main objective of the study to

utilize our theoretical knowledge to understand the complex/ competitive market situations

and gain experience with the organization, to understand the difference between our

practical and theoretical knowledge. We mainly focused on how does the company

maintain its supply chain through using a supply chain management, how the company’s

applications are electronically integrated with back office information system and database

to share inventory data it’s selling partners, how the firm maintain its Information

Technology and abrupt change in organization structure and supply chain, and how the firm

handle the relationship with it upstream and downstream partners. After all our main focus

was around the supply chain management of the company.

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 Table of Contents

Chapter One.................................................................................................................................... 1
Introduction .................................................................................................................................... 1
1.1: Background of The Company ............................................................................................ 1
1.2: Vision of The Company ...................................................................................................... 1
1.3: Mission of The Company .................................................................................................... 2
1.4: Goals of The Company ....................................................................................................... 2
Chapter Two ................................................................................................................................... 3
Literature Review ........................................................................................................................... 3
Chapter Three................................................................................................................................. 4
Methodology of The Research ....................................................................................................... 4
3.1: Data Collection .................................................................................................................... 4
Chapter Four .................................................................................................................................. 5
Findings of The Research .............................................................................................................. 5
4.1: Supply Chain Management of The Company .................................................................. 5
4.2: Maintenance of The Supply Chain Process of Unilever .................................................. 5
4.3: Using Information System to Manage Supply Chain ...................................................... 6
4.4: Improvement of The Company Using Supply Chain Information System .................... 7
4.5: Exchanging Inventory Data with Supplier ....................................................................... 8
4.6: Exchanging Operational Data with Business Partner ..................................................... 8
4.7: Performance of Unilever in The Market ........................................................................... 8
Chapter Five ................................................................................................................................... 9
Analysis............................................................................................................................................ 9
5.1: Number of Suppliers Per Category Spend........................................................................ 9
5.2: Supply Chain Spend Analysis .......................................................................................... 10
5.3: SWOT Analysis of Unilever ............................................................................................. 10
Chapter Six ................................................................................................................................... 12
Conclusion ..................................................................................................................................... 12
6.1: Gist...................................................................................................................................... 12
6.2: Recommendations ............................................................................................................. 12
6.3: Limitations of The Report ................................................................................................ 13
References ..................................................................................................................................... 14

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 Chapter One
Introduction

1.1: Background of The Company

Unilever Bangladesh is a company that has its own history intrinsically built with the
development of our nation and our culture. It has been part of the Bangladeshi household
since the 19th century with the same intention of bringing cleanliness and convenience to
households as we do today. Back then Sunlight soap was marketed through Lever Brothers
India limited throughout the undivided India. Later on, Lever Brothers Pakistan limited
started its operation in Bangladesh on a larger scale. In 1964, our soap manufacturing
facility was setup in Kalurghat, Chittagong.

With time it gradually evolved and diversified into manufacturing personal products like
skin care creams, toothpastes, shampoos, detergent powders, and so on. Accumulating
manufacturing experience over 40 years, we have a legacy of leading the market with
international brands offered at affordable prices. Today, with 13 different brands in 8
different categories, Unilever Bangladesh stands as one of the most progressive partners in
development for the Government of Bangladesh.

1.2: Vision of The Company

Unilever products touch the lives of over 2 billion people every day – whether that's through
feeling great because they've got shiny hair and a brilliant smile, keeping their homes fresh
and clean, or by enjoying a great cup of tea, satisfying meal or healthy snack.

To make cleanliness a commonplace; to lessen work for women; to foster health and
contribute to personal attractiveness, in order that life may be more enjoyable and
rewarding for the people who use the products.

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1.3: Mission of The Company

Unilever's mission is to add Vitality to life. They 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.

Besides, a clear direction has been mentioned in the following page.

The four pillars of the company’s vision set out the long-term direction for the company –
where they want to go and how they are going to get there:

• They work to create a better future every day

• They help people feel good, look good and get more out of life with brands and
services that are good for them and good for others.

• They will inspire people to take small everyday actions that can add up to a big
difference for the world.

• They will develop new ways of doing business that will allow them to double the
size of their company while reducing their environmental impact.

They've always believed in the power of their brands to improve the quality of people’s
lives and in doing the right thing. As their business grows, so do their responsibilities. They
recognize that global challenges such as climate change concern them all. Considering the
wider impact of their actions is embedded in their values and is a fundamental part of who
they are.

1.4: Goals of The Company

The goals of UBL are:

• To manufacture high-standard products.

• Promoting products to the highest extent
• Producing large volume to achieve production cost economies.
• Enabling quality products to be sold out at obtainable prices.

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 Chapter Two
Literature Review

Supply Chain is the beating heart of the organization. The people related with the supply
chain plays a vital role in getting the goods to customers and consumers; from sourcing raw
materials to manufacturing and delivering the end product. Supply-chain management has
been defined as the "design, planning, execution, control, and monitoring of supply chain
activities with the objective of creating net value, synchronizing supply with demand and
measuring performance of a company. Supply-Chain Management (SCM), techniques with
the aim of coordinating all parts of SC from supplying raw materials to delivering and/or
resumption of products, tries to minimize total costs with respect to existing conflicts
among the chain partners. The purpose of supply chain management is to improve trust and
collaboration among supply chain partners thus improving inventory visibility and the
velocity of inventory movement.

In this report, the focal discussion is in the findings and analysis part. How the company
manages the supply chain, how they use information system in the supply chain and its
benefits, how the company improved their supply chain, how and to whom the company
share its inventory and operational data, and their current performance in the market are
presented in the findings part. Some costing related to the supply chain, the cost distribution
in the supply chain and the SWOT analysis is given in the analysis part. And at the end, the
summary of the whole report, and some recommendation to the company based on the
information analysis is given in the conclusion part.

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 Chapter Three
Methodology of The Research

To satisfy the objectives of the term paper research, a deep study was done. This report is
mixture of both quantitative and qualitative research. In case of quantitative research,
analyzing the company’s expenditure to different sector of their supply chain and based on
the results some visual representation with different kinds of graphs is given in the analysis
part.

And quantitative research was done for SWOT analysis and later some recommendation is
also given based on the analysis.

3.1: Data Collection

Both primary data and secondary data were collected to organize this report. But the report
is basically emphasized on secondary data.

Primary Data were collected from the informal discussion with the manager of the
organization.

Secondary Data was collected from different sources e.g. annual report of the organization,
web sites, reports, prospectus, journals, newspaper etc.

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 Chapter Four
Findings of The Research

4.1: Supply Chain Management of The Company

The Supply Chain Director (SCD) is in charge of planning, buying, manufacturing

and distributing heads Supply Chain Department. The supply chain process constitutes a
series of important activities ensuring smooth delivery to the consumers. Supply chain
process led to joining planning and buying with manufacturing. This chain is further
extended by joining distribution to the chain, thus integrating both backward and forward
linkages. An integrated supply chain will give them the advantage of acting with speed,
enabling them to keep up with pace of the ever-changing business scenario. At present, it’s
divided into the following functions:

• Manufacturing
• Engineering
• Company Buying
• Distribution
• Company Assurance
• Planning

4.2: Maintenance of The Supply Chain Process of Unilever

The company maintain their supply chain process by-

• Daily production and distribution planning, including all nodes in the supply
chain.
• Production scheduling for each manufacturing facility in the supply chain
(minute by minute).
• Demand planning and forecasting, coordinating the demand forecast of all
customers and sharing the forecast with all suppliers.
• Sourcing planning, including current inventory and forecast demand, in
collaboration with all suppliers.

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 • Inbound operations, including transportation from suppliers and receiving
inventory.
• Production operations, including the consumption of materials and flow of
finished goods.
• Outbound operations, including all fulfillment activities, warehousing and
transportation to customers.
• Sourcing contracts and other purchasing decisions.
• Inventory decisions, including quantity, location, and quality of inventory.
• Transportation strategy, including frequency, routes, and contracting.
• Strategic network optimization, including the number, location, and size of
warehousing, distribution centers, and facilities.
• Strategic partnerships with suppliers, distributors, and customers, creating
communication channels for critical information and operational improvements
such as cross docking, direct shipping, and third-party logistics.
• Product life cycle management, so that new and existing products can be
optimally integrated into the supply chain and capacity management activities.
• Segmentation of products and customers to guide alignment of corporate
objectives with manufacturing and distribution strategy.
• Information technology chain operations.

4.3: Using Information System to Manage Supply Chain

An IT powered system has been implemented to supply stocks to redistribution stockiest.

A supply chain management software solution is one that is designed to automate the
planning aspects of managing the supply chain, the logistics aspects, or both. The objective
is to make the product available at the right place and right time in the most effective
manner. For this, stockiest have been connected through a inter-based network, called RS
Net, for online interaction.

The planning aspects of managing a supply chain include: Identifying the most effective
transportation means to ship and deliver the product; analyzing the supply chain in order to
identify and eliminate any process bottlenecks; establishing production means and
scheduling.

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The execution aspects of managing a supply chain include: Establishing the price and
availability of the product; Mapping out alternate product transportation logistics; ensuring
the availability of resources needed for manufacturing. The other functions of information
system are-

* Substantial investment in IT-based sales system.

* Every salesman book order on a palmtop.

* All order is fed into central database from the distribution center.

* Network is installed at all 3500 distributors point-which makes for accurate on- the-
fly demand projection and helps to avoid stock- out loss.

The prime advantages that they get from using this system are-

✓ Minimizing the supply chain process, as measured from manufacturer to consumer.

✓ reducing much of the demand uncertainty that arises in the supply chain process
✓ Providing knowledge about how to make use of the data available in order to
determine how long each part of the supply chain takes to accomplish its function.

4.4: Improvement of The Company Using Supply Chain Information

System

Supply chain information system increase the business performance by-

• Reducing stock of inventory by giving proper information about the market

demand.
• Informing suppler constantly about the status of inventory stock so that
shortage of inventory is not created.
• Speed the product time to the market.
• Providing knowledge about what consumer wants and thus enables to ensure
customer satisfaction and reduce churn rate.
• Reducing excess demand and supply gap.
• Ensuring cash utilization as well as asset utilization

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 • Based on the information of delivery date, the company deliver product to
customer and thus supply chain information system improves delivery service of
the company.
• Reducing inventory cost, redundant effort and increasing customer sale.

4.5: Exchanging Inventory Data with Supplier

The company exchange inventory data with supplier to inform them about the status of
inventory stock, which is analyzed by supplier to predict…

• The delivery time of inventory.

• In which time the procurement and production of product should be commenced.

4.6: Exchanging Operational Data with Business Partner

Information on direct competitors, a company's labor statistics, and information on

suppliers, accounting data and projection of needed resources may all be included in
operational data. Data collected on direct competitors helps marketers make the products
seem superior to competing products. Data on customers helps marketers create consumer
profiles that help with everything from product creation, to distribution and advertising.
Labor and accounting data help with internal control of finances and productivity.

4.7: Performance of Unilever in The Market

Performance and measurement are one of the main parts of our topic. In the case of
Unilever, the performance of that company is very good. Because of its various kind of
products, it is the market leader of most of the sector. Behind its success there are some
factors such as:

• The quality and control of their product in the market

• On time delivery and shipment
• Latest technology use to produce their product
• Skilled employees and worker
• Brand value
• Their huge marketing-chain.

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 Chapter Five
Analysis

5.1: Number of Suppliers Per Category Spend

• Unilever spends its largest portion of money on logistics and operation. It spends
44% of its total expenditure on this site. This total around 14.96 billion Euros.
• The next largest expenditure of Unilever is its marketing and business services. It
spends its 34% of the expenditure on this site. This totals a sum of 11.56 billion
Euros.
• The company spends 10% on raw materials. These totals up to 3.4 billion Euros.
• Unilever spends 6% on packaging that is around 2.04 billion Euros.
• Like packaging the company also spends 6% on third party manufacturing which is
around 2.04 billion Euros.
• The company spends around a grand total of 34 billion Euros.

Expenditure

6%
6%

logistics and operations

10%
marketing and business services
44%
raw materials
packaging
third party

34%

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5.2: Supply Chain Spend Analysis

• The total number of supplier sites of Unilever is 5290 suppliers.

• It has 2319 suppliers as its logistics and operational suppliers.
• The company has 2195 suppliers as marketing and business service suppliers.
• The company has 504 third party suppliers.
• Unilever has 560 raw material suppliers.
• It has 490 packaging suppliers.

2500 2319
2195

2000

1500

1000 number of suppliers

504 560
490
500

0
logistics and marketing third party raw material packaging
operaion and business suppliers
services

5.3: SWOT Analysis of Unilever

Strengths:

• Very strong brand value

• Most trusted name in very household
• State of art plant and comparatively strongest marketing team than its rival
• Very good strategic presence in media and excellent visibility availability in market
• Company uses supply chain information system

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Weaknesses:

• For high end Brand Unilever Bangladesh have to totality depend on import
• For many low-end brands, existing production capacity is not sufficient enough to
support market demand
• Don't have enough skilled human resource and production capacity to support
growth
• In policy making and decision level UBL is highly dependent on regional HQ

Opportunities:

• Bangladesh's emerging economy and increasing standard of leaving

• Unilever food and beverage has got very good prospect in BD
• In washing powder economies of scale driven low cost leadership can make UBL
monopolist
• Unilever can launch its high-end brands in BD

Threats:

• Entrance of regional and global FMCG brands

• Price of dollar increase which decline the profitability
• Due to high inflation people lose their purchasing power.
• Very high competition on hair care and herbal skin care Brands

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 Chapter Six
Conclusion

6.1: Gist

Analyzing all the part of SCM we can say that comparing with others Unilever BD Ltd is
very much effective and efficient in their market. The information technology used by the
supply chain management of the company. Which serve the both inside and outside partners
of the company. They are now the market leader and the secret behind their success is the
effective SCM. From production to distribution they maintain a great balance. They are
very much successful in their sector by using effective SCM they made their success. They
use SCM in their factory which tells them which product is on inflows and which is on
outflow. They make the best use of their resources and make the product. They mean that
if the customer is satisfied the production and the profit will also gain. That’s why they
made an effective SCM which makes them very much efficient in the field of their market.

6.2: Recommendations

• Margin to distributors is low. Company should focus in this direction to pass on

more benefit to the distributors. If margins are increased from 4.76%, distributors
will be more motivated.
• The company can enable to increase its profit merging to 20.5% up then before by
providing the best customer support, following customer driven business process.
• In order to compete with local and cheaper brands, company should come up with
competitive products that can cater institutes more effectively and efficiently with
a basic Focus on pricing strategy.

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6.3: Limitations of The Report

Although we have got co-operation from manager of Unilever, the major limitations that
the study faced during the study period are spot lighted below:

• The major problem we have faced is lack of understanding.

• Unilever as a big organization, the people working in here are so busy so, it was
very much tough for us to allocate time for collecting data and taking interview of
the manager.
• As most of the data is collected from secondary sources, there was very little
opportunity to analysis data.
• Time constraint is one of the problems, for which it has been difficult for us to
gather enough knowledge.

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 References

Supply Chain – Career – Unilever Bangladesh. Retrieved on October 2018. From

https://www.unilever.com.bd/careers/graduates/uflp/supply-chain/

Unilever Supply Chain Overview. Retrieved on October 2018. From

https://www.unilever.com/Images/unilever-supply-chain-overview---may-2018_tcm244-
523172_1_en.pdf

2.8 Unilever Bangladesh. Retrieved on October 2018. From

http://dspace.bracu.ac.bd/xmlui/bitstream/handle/10361/2714/08104001.pdf?sequence=4

Unilever Bangladesh: Home. Retrieved on October 2018. From

https://www.unilever.com.bd/

Our History – Welcome to Unilever Bangladesh Limited. Retrieved on October 2018. From
http://unilever.freeservers.com/html/company/history.htm

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