The Business Of Unilever Nigeria Plc Commerce Essay

September 27, 2017 Commerce

Unilever has built its concern on apprehension and reacting to the demands of its consumer ‘s globally. Its corporate end is to add value and quality to the basic facets of its consumer ‘s satisfaction which adds value and srength to the consumer ‘s life.

Unilever Nigeria Plc, came into life as Lever Brothers ( West Africa ) Ltd on 11th April, 1923 by Lord Lever Hulme, but the company ‘s ancestors have to be traced back to his bing trading involvements in Nigeria and West Africa by and large, and to the fact that he had since the nineteenth century been greatly involved with the soap concern in Britain. Unilever Nigeria started with the soap fabrication company, and is today one of the oldest lasting fabricating organisations in Nigeria.

Their Merchandises:

Unilever produces a batch of merchandises, viz. ;

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Food trade names ( e.g. , Knorr, Lipton, Blue set, Beverages )

Home attention trade names ( e.g. , Shampoo, Toothpaste, Soap, Moisturising pick )

Personal attention trade names ( e.g. , Lux, Vaseline, Sunsilk, Omo, Pears )


Health, hygiene and beauty

Unilever nutrient solutions

Your suggestions

Latest trade name intelligence

The success of this concern is as a consequence of the sound relationship which they have established with the consumers in the local civilizations and markets making merchandises that help them transform in life. In prolonging these successes, they ensured to keep the highest and sound criterions of common behaviour towards their employees, consumers, clients, communities and runing environment as a whole.

Talking about their trade names, they produce domestic goods which they know from the oncoming that people would truly necessitate such goods because, it enhances the day-to-day life of people. For this ground, they are committed to run into the mundane demands of people everyplace in Nigeria. In add-on, because they are have International experience and support, it enables them to systematically develop trade names, which raise the worth of life. In kernel, most people in Nigeria ever have their merchandises at place.


The PESTLE Analysis is an analytical tool used to measure and place the Political, Economic, Social, Technological, Legal and Environmental factors in a given economic system that would impact the operation of an organisation.

Harmonizing to Kotler ( 1999 ) PESTLE Analysis is a utile strategic tool for understanding market growing or diminution, concern place and way for Operations. This Analysis besides allows an Organization to hold a competitory advantage over other houses in the industry.

Political Factor: This factor is ever necessary to be evaluated, in order to cognize the favorability of the political clime to market growing and development in a peculiar state, such as the Government Stability, Taxation Policy, and Attitude of the Government towards foreign investing.

Economic Factor: This Economic model is used to mensurate the province of an economic system by sing the GDP, the pay degree, involvement rate, the disposable income, unemployment rate, concern rhythm and the economic growing in the state.

Socio Cultural Factor: This index is used to mensurate the rate and growing of population, alterations in the gustatory sensation and penchants of consumers, the alterations in the life style of consumers and the degree of instruction of the public which would hold a great consequence on the demand of the merchandises or services provided by the organisation.

Technological Factor: This Framework is used to measure the degree of Government passing on Research and Development institutes and the attempts of authorities and private sector attempts towards technological promotion.

Legal Factor: This is used to cognize the Torahs and ordinances that exist in the environment an organisation is runing such as the employment, wellness and safety Torahs.

Environmental Factor: This is used to understand the assorted environmental Torahs, natural resources available and the prevailing conditions status in the economic system.

1.3 Analysis

Using Porter ‘s theoretical accounts ( Kippenberger, 1998 ; Haberberg and Rieple, 2001 ) , but to analyze it in add-on to other strategic models ofA SWOTA andA PEST analysis.

In seeking to analyse the schemes, it will be just to cognize what Business Strategy is all about.

Business scheme to my ain apprehension is a manner in which administrations view the hereafter, the extent to which the concern is heading to, the program, set marks, etc. The basic purpose of scheme is to travel the concern frontward, it is non all about doing net income entirely, but how the concern can win finally. In other words, it will set up strategic way, and implement those schemes, all in an attempt to fulfill cardinal stakeholders.

Robert and Caldart ( 2009 ) position scheme as a manner a house can merely speculate about the deductions of different possible enterprises and larn more about them through interaction with other histrions such as rivals, regulators, clients, providers, and spouses in its competitory landscape. In these state of affairss, directors face the highly hard job in doing determinations that demand a long-run position, perpetrating the house in the long-run within a competitory landscape that is improbable to stand still. We call these determinations strategic determinations.

Porter E.M. ( 1996 ) Views scheme as “ being flexible, companies must be flexible to react quickly to competitory and market alterations sharply to derive efficiencies and accomplish best pattern. Strategy to him is entire quality direction, benchmarking, time-based competition, re-engineering, alteration direction. ” From this definition, it is believed that, for any concern to turn there should be freedom, ability to originate programs on how to travel the concern frontward.

Ellis & A ; Williams ( 1993 ) expressed that, “ It indicates the positions for concern to accomplish better advantages, it elaborates tactics for concern to face challenges, it points out the tendencies and competitions around the concern. ” Business consists of two chief facets, viz. external factor and internal factor.

From the definitions given by these bookmans, it entails that, scheme is seen as a agency of doing concern to endeavor and to accomplish a defined end through vision, difficult work, through doggedness that will take to transmutation.

1.4 Application


Internal factors include information and communicating as one of the internal control constituents. The factors are systems used to command fiscal, coverage and accounting systems in an administration. Smooth flow of information and communicating across and within the administration is influenced by the nature of the working relationship within the administration at all degrees. The working relationship coordinates administration ‘s activities to accomplish specific end. When effectual working relationship exists in an administration, deputation of duties is achieved. The chief internal factors which are considered to continue the administration are the directors, employees, capitals, and stuffs.

Directors: Since the origin of Unilever, there were invariably sound and visional directors wining the personal businesss of Unilever and severally bettering the direction of Unilever.

Employees: Unilever has monolithic employees who perform specific responsibilities to travel the administration frontward. Unilever has the universe ‘s top shapers of packaged which has merchandises like shampoo, deodourants, soap, Vaseline, tea, and frozen nutrients over the universe. The company sells its goods in over 150 states and has returns of about $ 46 billion ( ?31,5bn ) . Unilever controls subordinates in at least 90 states and employs 295,000 ( in 2000 ) people. Unilever is one of the universe ‘s top three houses after Nestle and Kraft and the universe ‘s 2nd largest packaged consumer goods company behind Procter & A ; Gamble.

Capital: Unilever is one of the oldest lasting fabricating administrations in Nigeria today. The administration is good known with its merchandises all over the universe, its nutrient trade name, place attention merchandises, Unilever nutrient solution, personal attention trade names, nutrition, etc, Unilever is recognised as the universe ‘s most valuable trade name.


The word external merely means “ outside ” that is the activities which takes topographic point outside the concern environment. The external environment of any administration is a big and complex topographic point. ( Capon, 2009. P.5 ) for the interest of this work, we shall take a expression at PESTEL analysis of the administration, which includes Political, Economic, Socio-cultural, Technological, Environmental, & A ; Legal elements.

Political Environment: The authorities is presently concentrating on promoting the local industry of finished and semi-finished goods in the country.A ThisA will be aA major advantage for interested local investors as it provides them with a playing land for constructing their business.A Currently, local makers face a figure of challenges including:

High Input Cost, A

Lack of petrochemical works, A

High cost of production/distribution, A

Customss disposal and port related issues, A

Common External Tariff ( CET ) and issue of fight

Security of life & A ; belongings

Weak legal frameworkA

Although, there are assorted inducements in topographic point to hike local industry the high dealing costs ensuing from above do local fabricating uncompetitive with the outside world.A

Unilever, as a affair of policy, set a criterion as to the manner of undertaking political issues. In the 1960s, many states began to nationalize foreign houses which besides affected Unilever. There were relentless calls for local equity engagement in foreign houses ; many companies were capable to local control on monetary values, imports, and employment of exile. An illustration is UAC, a subordinate of Unilever, whose operation was in many African states like Cameroun, Ghana, Ivory Coast, including Nigeria, was focused on as its net income border and the rate of easy remittal of net income to its Anglo-Dutch parent was tremendous. Nationalizing UAC hampered Unilever ‘s control over the market where UAC operates.

Economic Factor:

GDP – existent growing rate: A 3.8 % ( 2009 est. ) A

5.3 % ( 2008 est. ) A

6.4 % ( 2007 est. ) A


GDP – existent growing rate


Percentage Change

Date of Information


3.00 %



2002 est.


7.10 %


136.67 %

2003 est.


6.20 %


-12.68 %

2004 est.


6.90 %


11.29 %

2005 est.


5.30 %


-23.19 %

2006 est.


6.40 %


20.75 %

2007 est.


5.30 %


-17.19 %

2008 est.


3.80 %


-28.30 %

2009 est.

Beginning: A CIA World Factbook

This entry gives GDP growing on an one-year footing adjusted for rising prices and expressed as a per centum.

GDP ( buying power para ) : A $ 353.2 billion ( 2009 est. ) A

$ 340.3 billion ( 2008 est. ) A

$ 323.1 billion ( 2007 est. ) A

note: A informations are in 2009 US dollars

This entry gives the gross domestic merchandise ( GDP ) or value of all concluding goods and services produced within a state in a given twelvemonth. A state ‘s GDP at buying power para ( PPP ) exchange rates is the sum value of all goods and services produced in the state valued at monetary values predominating in the United States. This is the step most economic experts prefer when looking at per-capita public assistance and when comparing populating conditions or usage of resources across states. The step is hard to calculate, as a US dollar value has to be assigned to all goods and services in the state regardless of whether these goods and services have a direct equivalent in the United States ( for illustration, the value of an ox-cart or non-US military equipment ) ; as a consequence, PPP estimates for some states are based on a little and sometimes different set of goods and services. In add-on, many states do non officially take part in the World Bank ‘s PPP undertaking that calculates these steps, so the ensuing GDP estimations for these states may miss preciseness. For many developing states, PPP-based GDP steps are multiples of the official exchange rate ( OER ) step. The differences between the OER- and PPP-denominated GDP values for most of the affluent industrialised states are by and large much smaller ( CIA World Fact book ) A

In Nigeria there was uncertainness about responsibilities to be paid by companies due to rising prices and fluctuation of currency. The consequence on Unilever was a lessening in net income in 2005 compared to 2004, though there was addition in turnover. In 2004 and 2005 the net income after revenue enhancement were =N= 2.167 billion ( naira ) and =N= 1.616 billion ( naira ) severally, while in the turnover in 2004 and 2005 were =N= 28.6 billion ( naira ) =N= 33.4 billion ( naira ) severally, which indicates addition in turnover but lessening in net income. Besides the low per capital of people affects Unilever ‘s market. Over 30 % of Africa population lives on less than $ 1 per twenty-four hours.

Socio-cultural Factor:

Looking at the societal factor of Unilever, their chief focal point is to “ add beauty to life ” , they guarantee that they meet the demands of consumer on day-to-day footing Such demands are ; nutrition, hygiene, and personal attention with trade names that help person experience good, look good and acquire more out of life. Unilever can do merchandises that help give kids a good start and be healthy for longer clip. Their trade names are besides involved in a figure of societal enterprises to advance the importance of playing athleticss. Unilever has a platform and land to better verve worldwide through its planetary graduated table and its interactions with consumers. Every twenty-four hours, 150 million consumers use Unilever trade names. They use them to experience truly good.

Health and Welfare

Refering the country of wellness, Unilever has the recognition to do people experience really healthy because they have good nutrient that establishes their satisfaction. Soya is another plant-derived ingredient with an first-class nutritionary profile. It is cholesterol-free, and a good beginning of protein, vitamins and omega-3 and omega-6 fatty acids. It has modest cholesterin take downing possible

Unilever Brand

Unilever trade name is superior and sound trade names to assist add value to the lives of people in general.Unilever Nigeria is a taking maker of Oral attention merchandises such as Close up Fresh Red Toothpaste, Close-Up Extended Protection Toothpaste, Close Up Expert and Popular Toothbrushes. From the launch of Close Up Red Gel toothpaste in 1975.

Technological Factor:

The basic purpose of technological factor is that, it enhances speedy consciousness to the general populace through the usage of cyberspace installations, wireless, telecasting etc which promotes the selling facet of the concern. Unilever attract people with their advertizements, another scheme they use is e-commerce. Unilever wants to step up the usage of the Internet in order ‘to better trade name communication/marketing and online merchandising & A ; to simplify business-to-business minutess throughout the supply concatenation.

Legal Factor: Though Nigeria has a weak legal construction by and large, it has a Parastatal called Nigeria Agency for Food & A ; Drugs Control ( NAFDAC ) that regulates activities of transnational companies that are into fabrication of consumables like nutrients, Beverages and Detergents. Unilever are committed to supplying consumers with merchandises that are consistent in quality, safe in usage and free from inauspicious effects at all times.

These are achieved by:

1. Fostering a consumer safety construction throughout the company by set uping systems and processes that will vouch the well being of their consumers.

2. Complying with all legal demands in the direction of consumer safety.

3. Implementing an effectual consumer ailments mechanism, to supervise, investigate and trade with ailments from the trade.

4. With all these safeguards, they are continuously determining that their merchandises and processes run into the highest criterions of quality and safety.

Environmental Factor: UnileverA Nigeria takes the duty of raising the quality of life of people in the operating environment through the quality of their trade names and parts to communities in which they operate. Talking about the environment, it explains the conditions, temperature and the climatic status of the environment which the concern operates, in most instances, when the conditions status is good, it favors the concern itself. Unilever is a market that is known globally and its market has been successful all over the universe, due to this consciousness, its trade name is good appreciated.

Porters Five Forces:

Understanding the nature of each of these forces gives organisations the necessary penetrations to enable them to explicate the appropriateA strategiesA to be successful in their market ( Thurlby, 1998 ) .

Competition: Competition in any concern outfit is inevitable, when a concern should hold its challengers, it motivates them to better more in their merchandises in other to pull more attending to consumers. The strength of competition, which is the most obvious of the five forces in anA industry, Unilever has been more dominant in market comparison to Nestle.

Barriers to Entry: The menace of new entrants is normally based on the market entry barriers. In contrast, entry barriers exist whenever it is hard or non economically executable for an foreigner to retroflex the officeholders ‘ place ( Porter, 1980b ; Sanderson, 1998 )

Suppliers: The menace that replacement merchandises pose to an industry ‘s profitableness depends on the comparative price-to-performanceA ratiosA of the different types of merchandises or services to which clients can turn to fulfill the same basic demand.

Customers: Kippenberger ( 1998 ) states that it is frequently utile to separate possible purchaser power from the purchaser ‘s willingness or inducement to utilize that power, willingness that derives chiefly from the “ hazard of failure ” associated with a merchandise ‘s usage. In any concern administration, “ Buyer Power ” is a force that influence the value established by anA industry. A The most of import facet of purchaser power is the size and the concentration of clients. Other factors are the extent to which the purchasers are informed.

Substitutes: as the name implies, replacement merchandises are normally many in the market and huge Numberss of replacements are available, supplier power is seen as a mirror image of the purchaser power. In other to convert clients to purchase merchandises at different monetary values in the value created for each of those purchasers normally indicates that the market is characterised by high provider power and at the same clip by low purchaser power ( Porter, 1998 ) . Dickering power of providers exists in the undermentioned state of affairss:

Where the shift costs are high ( exchanging from one Internet supplier to another ) ;

High power ofA brandsA ( McDonalds, A British Airways, A Tesco ) ;

Possibility of forward integrating of providers ( Brewers purchasing bars ) ;

Atomization of clients ( non in bunchs ) with a limited bargaining power ( Gas/PetrolA Stationss in distant topographic points ) .

4. SWOT Analysis:

SWOT analysis to my ain apprehension is a manner to analyse the Strengths, Weaknesses, Opportunities, and Threats involved in a concern environment. It explains the intent of the concern and if there are any oversights or pot holes, the direction is apt to supply solutions.

The tabular array below summarises the SWOT analysis of Unilever Nigeria

Strength: Unilever Nigeria is recognised as a planetary company which has its merchandises all over the universe.

It has strong trade name portfolio and sound relationship with retail merchants fundamentally and economic systems of graduated table.

Strong roots in local markets and first-hand cognition of the local civilization.

Failing: Unileverweakness is the double leading non linking with clients and secondly,

Inefficient direction for R & A ; D the inability to maximise.

Opportunities: Unilever has the chance of increasing demand for healthy merchandises and altering consumer penchants by adding value to their day-to-day demands.

Menaces: Unilever brush lessening in grosss and strong competition, increasing shop trade names.

They besides encounter Tougher Business Climate and exchange rates.

1. Core Competences:

A nucleus competence is a manner in which a concern handles the personal businesss of the administration. In other words, the administration makes promotions to the growing of its concern. In nucleus competency, it is non normally easy for rivals to copy, take for illustration, in the country of stigmatization, the Logo of a company, and their manner of making things etc it is normally hard to copy. The nucleus competency of Unilever is that, it can supply competitory advantage in its strong trade name portfolio, strong relationship retail merchants. Brand is an plus of a company, it helps to separate companies merchandise merely as my lector Mr. John justly said, it is the trade name and logo of a company that promotes the market to viing merchandises to assist gross revenues and capture the market.

2. Global positions

Unilever is an administration known globally and it has made impact to so many people ‘s lives, their merchandises have spread abroad, they have gainfully employed 1000000s of people and their merchandises have been sold massively across the Earth. Its planetary factor is accomplishing its growing and aims, looking at how Unilever has pushed the concern toward planetary attack is focused towards new chances, this could be traced back to how Unilever started, sing this from the historical position of the company. In 2002, Unilever initiated a procurance Centre in Shangai and China, this was to increase chances for Chinese natural stuffs suppliers. Unilever besides carried out research and development to be able to determine new merchandise and have basic cognition to present to new market, these activities were meant to hike Unilever planetary concern.

Another factor Unilever adopted is in the country of trade name, they did this to make awareness across boundary line synergisms in fabrication and selling. In other to carry through this undertaking, it started in 1999 when it launched the “ Heart Brand ” logo of ice pick merchandise, this was meant to heighten its merchandises. This thought was carried out to capture integrating amongst subordinates to ease control centralization.


Bye and big, the administration is in a really good place to go on turning. The history of Unilever is truly astonishing because, it started with the soap production and bit by bit, it grew up to bring forthing diverse merchandises today which is truly heightening the lives of people. In this work, I established the following which include therefore:

The History of Unilever Nigeria

The theoretical Model

The Analysis, internal and external factors

The five forces ( Porter )

SWOT Analysis and Core competencies and eventually,

Global positions


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