Strategy Generation

& Selection
► Chapter 8

 Exercices 8-A

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EXERCISE 8-A: Should Unilever Penetrate Southeast
Asia Further ?

Purpose
nilever is featured in the opening chapter case as a firm that engages in excellent strategic
planning. Unilever is the world’s third-largest consumer goods company (behind Procter &
Gamble and Nestlé). Some of Unilever’s best selling brands are Aviance, Ben & Jerry’s, Dove,
Flora/Becel, Hellmann’s, Knorr, Lipton, Lux/Radox, Omo/Surf, Sunsilk, Toni & Guy, VO5, Wall’s,
and PG Tips. The purpose of this exercise is to give you experience investigating a particular
region of the world to determine whether a firm should expand more into that region of the
world. Unilever has recently begun construction of a new factory in Yangon, Myanmar, and by
2015 expects to provide direct and indirect employment for over 2,000 people in Myanmar. The
company currently employs close to 200 Myanmar employees at its factory in Thailand, of which
a number are being moved back to Myanmar to help kick-start its operations in the country.

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 Step 1 Go to the Unilever website and download the company’s
most recent Annual Report. Examine the narrative and tables
related to their operations in Southeast Asia
 In 2008 Unilever‟s worldwide turnover was €40.5 billion.
 They employ 174 000 people in around 100 countries
worldwide.
 Every day, 160 million people choose their brands to feed
their families and to clean themselves and their homes.
 Their strong portfolio of foods, home and personal care
brands is trusted by consumers the world over. Among them,
the top 25 brands account for over 70% of sales.
 In 2008 they invested €927 million in research and
development
 They are the global market leader in all the Food categories
in which they operate: Savory and Dressings, Spreads, Weight
Management, Tea, and Ice Cream
 They are also global market leader in Skin and Deodorants,
and have very strong positions in other Home and Personal
Care categories.
 In 2008 they invested €91 million on community projects
worldwide. 8-3
Step 2: MYANMAR COMPETITIVE CLIMATE AND
BUSINESS CULTURE”
 Myanmar has been attracting foreign investment by granting tax incentives, and
simplicity and predictability. In addition to having cheap labor charges, abundance
natural resources, having a sizable market and being at a strategic location.
 Business in Myanmar requires patience as well as a willingness to build friendships
and foster trust.
 In Myanmar ‘U’ and ‘Daw’ are used as equivalents of ‘Mr’ and ‘Mrs’ or ‘Ms’.
Exchanging business cards is common.
 it might be wise to print double-sided cards with both English and Myanmar text.
 As in much of South East Asia, it is also important to be aware of whether or not
your hosts remove their shoes before entering their office.Another important
aspect of doing business
 in Myanmar is the need to be in the country either permanently and regularly, as
personal relations are culturally important

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Step 3: Develop six recommendations for Unilever based on your
assessment of their present and potential operations in
Southeast Asia.

1) Strong brands
2) Broad product mix
3) Economies of scale
4) Strong global market presence
5) Imitable products
6) Limited business diversification

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 Unilever is a leading consumer goods business in the
global market.
 A SWOT analysis of the company highlights business
strengths that ensure long-term success.
 Unilever has some of the strongest brands in the
consumer goods industry
 Strength enables the company to penetrate markets and
effectively compete against other firms.
 The broad product mix shows the extent of Unilever’s
business growth.

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