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Unilever is dedicated to meeting the everyday needs of people everywhere. Around the world Unilever foods and home & personal care brands are chosen by many millions of individual consumers every day. Earning their trust, anticipating their aspirations and meeting their daily needs are the tasks of Unilever local companies. They bring to the service of their consumers the best in brands and both Unilever s international and local expertise.
For more than 70 years Unilever has been providing consumers with quality products and services. Unilever has a portfolio of global, regional and local brands. Some, such as Dove, Hellmann s, Lipton, Lux, Magnum, and Vaseline, are popular around the world. Others are the first choice for consumers in particular countries. As traditional structures and lifestyles around the world are being rapidly transformed, Unilever continues to respond to consumers present needs and, at the same time, to anticipate their future ones. Our strength lies in the deep understanding we have of local culture and markets. Unilever s strategy is to focus research and development and marketing on our top performing brands, that is, those that are most in demand from consumers. Through our extensive knowledge of trends identified today, we will continue to develop our brands to meet the needs of our consumers tomorrow. , feel and smell great.
Unilever products are at home everywhere: favorites with consumers throughout the world, from the emerging markets of Asia and Latin America to the developed economies of Western Europe and North America.
Unilever meets the needs of consumers around the world, in both new and established markets. Consumers vary from country to country in their preferences and habits and Unilever adapt many of its brands to suit local tastes. For example, among Unilever s many teas, it produces around 20 separate brands of black tea specifically tailored for consumption in over 20 different countries and Unilever is constantly sharpening the flavors to suit all its local markets. In some societies, consumers have traditionally washed up by sponging ash, sand or detergent onto their dishes, before rinsing. Learning from these established practices, Unilever developed Vim dish wash bar, to bring improved cleaning to existing washing routines. Shopping habits also vary and the availability of Unilever s brands is a key concern of local managers. Unilever adapt the distribution of its brands to suit local realities. In Europe, customers benefit from swifter, easier dispatch through online ordering of frozen foods. While, in
Tanzania, Unilever has piloted bicycle delivery of products to villages inaccessible to motor transport. Building on a presence that in places stretches back nearly a century, it keeps closely in tune with local consumers. Unilever is, in every sense, a multi-local multinational.
Unilever s research and development teams help to anticipate and meet consumer needs. Unilever s research and development expertise allows to anticipate the evolving needs of consumers and to create the innovations to meet them. Internet technology is improving the way Unilever share best practice and innovation around the world.
Unilever s R&D activity is focused on six major laboratories and a network of innovation centers around the world. Recent successes have demonstrated Unilever s practical ability to respond to consumers and bring innovations to the marketplace. They include laundry tablets, which it has rolled out in more than 30 countries; Lipton Cold Brew tea bags, which take away the need to boil water when making ice tea; and its cholesterol-owering spreads, which have been widely rolled out under the Take Control, Becel and Flora brands. Unilever continues to look for new innovation opportunities. For instance, Unilever research into the human genome means they can now decode the make-up of skin. This can reveal such secrets as an individual s tendency for dryness or their skin protein mix. Such knowledge forms the foundation for new, more personal products.
Unilever s global IT system helps them to share information around the business and to use their scale and scope to meet consumer needs and reduce their costs. Unilever drives to provide better value for customers and consumers; they have always valued the sharing of information across product sectors and geographical locations. IT has boosted this knowledge-sharing culture, allowing us to make the most of the vast amount of Information held by our people around the world. Unilever s computer networks provide over 90,000 employees worldwide with common tools for sharing information allowing them to deal with millions of electronic messages every working day. They also have a Unilever Intranet, which helps them to manage innovation and best practice around the world. Global teams, for example, pool information, marketing success stories and knowledge via dedicated sites, making this knowledge available to Unilever s people locally, wherever they are.
Unilever is committed to doing business in a responsible and sustainable way. In partnership with organizations around the world, Unilever works to reduce their impact on the environment and to act as a responsible corporate citizen.
Unilever believes in sustainable development meeting the needs of the present without compromising resources for future generations. This commitment begins and ends with their consumers. Unilever believes that by constantly evolving to meet their changing needs, they can continue to develop their business in both a profitable and an environmentally sustainable way. In working towards sustainable development, they focus on three areas that are directly relevant to their business. These are fish conservation, clean water stewardship and sustainable agriculture. An example of their work in the area of fish conservation is the Fish Sustainability Initiative, which aims to meet their objective of sourcing all supplies from sustainable fisheries by 2005. Filegro, an Alaskan salmon-based dish, was our first product to come from a sustainable fishery, as certified by the Marine Stewardship Council. In clean water stewardship, as in other areas, Unilever joins with partners to achieve maximum impact. For example, through their sponsorship of the Global Nature Fund s Living Lakes initiative, they work with a network of private and government organizations to help communities better manage their local lakes and wetlands. In sustainable agriculture, Unilever has set up of an expert external advisory board. Its task is to advise and inform its business and suppliers on new sustainability standards.
Unilever s commitment to corporate social responsibility is an integral part of their operating tradition. It is outlined in their Corporate Purpose and in their Code of Business Principles. It finds practical expression in the worldwide standards they have set their selves: to ensure the health and safety of Unilever people at work, to secure the quality and safety of products and to minimize the environmental impact of their operations. Unilever aims to be as professional in their management of its social responsibilities as they are in any other area of business. Unilever recognize the need to be explicit about what their social commitment means in practice: to articulate their policies, and to demonstrate its performance. Unilever reports on their approach and progress in its Social Review. Unilever has a tradition of support for the local community wherever it operates, in particular in the areas of education, environment and health. For example, in India access to oral care is limited, with few dentists per head of population. In 2000, Unilever s oral health and hygiene education programme brought advice and care to over 2.5 million schoolchildren. In China, Unilever has sponsored Qinghai province s first Art Hope School. In a region where few can afford the cost of basic schooling, it offers the opportunity of a general education and free tuition in traditional dance, music and modern art.
Internet technology is providing a two-way communication channel, helping Unilever to get to know its consumers better.
Competition in markets is intense. To further develop their relationships with consumers and communicate the benefits of their brands, Unilever uses a variety of media, not only highly creative television advertising campaigns but also new one-to-one communication via the internet. Unilever brand communication has always made the news. In the 1950s, they produced the first ever television
commercial in the UK. As the 21st century began, they screened the UK s first interactive TV commercials, marketing their Colman s and Olivio brands.
Unilever Pakistan Limited is largest fast moving consumer Products Company in Pakistan. Unilever Pakistan Limited is a part of Unilever- a global company. Unilever Pakistan Limited is producing more than 50 brands in Pakistan.
Company information
Unilever Pakistan limited is a wholly owned subsidiary of Unilever Overseas Holding, UK, Unilever PLC (A company incorporated in the United Kingdom.)
The Company is incorporated in Pakistan and listed on the Karachi, Lahore, and Islamabad Stock Exchanges. It manufactures and Markets foods, beverages, detergents & personal Products.
BOARD OF DIRECTORS
COMPANY SECRETARY
Mr.Amar Naseer
AUDITORS
I.I.Chundrigar Road
Karachi.
REGISTERED OFFICE
Avari Plaza
Karachi.
Karachi.
COMPANY S BANK
PRODUCTION UNITS
Different factories of Unilever Pakistan Limited are operating in different areas of Pakistan. Brief information about theses units is given below:
The largest and the oldest unit of Unilever Pakistan Limited is situated in Rahim Yar Khan. Basically at this factory personal products, soaps, glycerin and dish wash bar are manufactured.
This factory was established in 1950 and it is situated in west Wharf area. Formerly it was owned and managed by Lipton Pakistan Ltd. In the last 43 years many modifications are made here. And the factory has expanded considerably. In this factory only tea is produced and packaged.
It is situated on Hub River in S.I.T.E. A&B Oil Industries established the factory in 1958 and the production of the vegetable oil began in 1962. In 1965 Lever acquired the factory. Banaspati, cooking oil and margarine are produced here and distributed all over the country.
This is recently established on Multan Road in district Kasur. The plant was commissioned in 1994 having the most modern and latest machines installed. Walls Ice cream is being manufactured here. LBPL, when acquired the Polka, also purchased its two factories, one in Lahore and other in Karachi.
Recently Unilever has acquired Rafhan Maize Products from Best Foods International.
The new Lever Black Tea Processing Plant has been set up at Dhodial, 12 km north of Mansehra on the main Karakoram Highway on 2.5 acres of land with the Processing Plant built-in area of 11,800 sq. ft. The plant is expected to process 50 kg per hour or approximately a ton of made tea a day.
The plant has cost Rs. 11 million whereas Rs. 12 million has been spent on the building and infrastructure. The plant has been inaugurated on 7th of September, 2001.
Product line
Personal wash
Tea
Ice cream
PERSONAL WASH
TOILET SOAPS
Rexona (3 varieties)
Breeze
FABRIC WASH
Ultra Surf
Surf micro
Surf Excel
Power Surf
HOME CARE
Vim Bar
Vim Powder
PERSONAL PRODUCTS
HAIR CARE
SKIN CARE
Ponds talc
DENTAL CARE
BANASPATI
Dalda banaspati
COOKING OIL
MARGARINE
INDUSTRIAL FATS
A whole range of products for the bakery & oils for the industry.
TEA
LEAF TEA
Yellow Label
Richbru
Top Star
Taaza Leaf
Supreme
DUST TEA
Pearl Dust
Ruby Dust
A1
MIXTURE TEA
Taaza
ICE CREAM
Cornetto (3 varieties)
Feast (2 varieties)
Feast Stickless
Top Ten
Callipo
Split
Fruiti
3-D
Solo (3 varieties)
Polka Cup
Panda
Dracula
Family Packs
Lifebuoy gold
Close up toothpaste
HISTORY
Unilever Pakistan Ltd (one of the largest multinational companies) is the member of Unilever PLC London. Unilever was formed in 1930 when the Dutch Margarine Company Margarine Unie merged with British soap maker Lever Brothers. Both Companies were competing for the same raw materials, both
were involved in large-scale marketing of household products and both used similar distribution channels. Margarine Unie grew through mergers with other margarine companies in the 1920s.
Unilever was founded in 1885 by William Hesketh Lever. Unilever established soap factories around the world. In 1917, he began to diversify into foods, acquiring fish, ice cream and canned foods businesses.
In the Thirties, Unilever introduced improved technology to the business. The business grew and new ventures were launched in Latin America. The entrepreneurial spirit of the founders and their caring approach to their employees and their communities remain at the heart of Unilever's business today.
Unilever NV and Unilever PLC are the parent companies of what is today one of the largest consumer goods businesses in the world. Since 1930, the two companies have operated as one, linked by a series of agreements and shareholders that participate in the prosperity of the whole business.
Margarine Unie and Lever is taken for Unilever. Its head quarter was established at England and Rotterdam. Unilever has 500 operating companies in 100 countries. It has 0.3 million employees and turnover of sales in 23000 million pounds. The global business proportion is 60% in Europe, 20% in North America and 20% in rest of the world. An identical board of directors controls the activities of subsidiary companies throughout the world
Unilever Pakistan Ltd was incorporated in1948 under the name of Sadiq vegetable oils &Allied industries in the state of Bahawalpur. Rahim Yar Khan factory begun to work in 1949. The first cotton seed was crushed in1951. The production of Vanaspati Ghee and Lux Toilet soap was started in 1952 and 1954 respectively.
Unilever Pakistan Ltd was incorporated as an independent Unilever operating company in 1958. In 1966 a vanaspati and vegetable oil factory was established in Karachi and Unilever Pakistan Limited moved its main office from R.Y. Khan to Karachi.
In 1989 LBPL and Lipton Pakistan Ltd were merged as a result of the international merger of both the multinationals. In 1995 it started another big business of Ice Cream.
Being a multi national company Unilever Palistan Ltd. is listed in all the three stock exchanges Karachi, Lahore and Islamabad. The 69% shares of this company are held by the parent Unilever Company and the remaining 31% are owned by financial institutions. Unilever Pakistan Limited has more than 3000 employees in Pakistan. Unilever Pakistan Limited has the following wholly owned and subsidiary companies;
Lever chemicals (Pvt) limited manufactures and sells sulphonic Acid. Lever Associated Pakistan Trust (Pvt) Limited and Sadiq (Pvt) Limited act as trustees of Union Pakistan Provident Fund (lever Provident Fund). All subsidiary companies are incorporated in Pakistan.
= 08ACRES (9%)
STORAGE AREA
CNO/PKO = 600MT
OBJECTIVES
Every company is formed to accomplish certain objectives. There is no company that has no goals. So the Unilever Pakistan Limited has also targets before it.
At the heart of the corporate purpose, which guides Unilever Pakistan Ltd. in their approach to doing business, is the drive to serve.
To meet the everyday needs of people everywhere to anticipate the aspirations of consumers and customers and to respond creatively and competitively with branded products and services, which raise the quality of life.
Total commitment to exceptional standards of performance and productivity, to working together effectively and to a willingness to embrace new ideas and learn continuously.
To maintain highest standards of corporate behavior towards employees, consumers and the societies and world to acquire success.
Company deals only in those products that are profitable. If there is any indication that any product is not profitable company analyzes the reasons and step are taken to overcome the reasons. Company introduces different marketing strategies if there are problems in marketing. Company also takes into consideration the welfare of the consumers. It takes into account the taste and habits of the consumer.
It also works for the welfare and interest of Pakistan in the following terms:
Contribution to GDP
MISSION STATEMENT
We are the leading consumer products company in Pakistan, a multinational with deep roots in the country.
We attract and develop highly talented people who are excited, empowered and committed to deliver double-digit growth.
We serve the everyday needs of all consumers everywhere for foods, hygiene and beauty through branded products and services that deliver the best quality and value.
We use our superior consumer understanding to produce breakthrough innovation in brands and channels.
Through managing a responsive supply chain, we maximize value from suppliers to customers
We are exemplary through our commitment to business ethics, Safety, Health, Environmentalist and involvement in the community.
We will help the company achieve its targets by constantly improving the quality of management information, achieving the standard demanded by our customers and maintaining flexibility to meet changing business needs.
Corporate Controllers team will continuously enhance its service level and meet the demands and expectations of its customers.
Timely and error free reporting to Unilever (Business group and Financial group) and other local /statutory Reporting will be maintained.
Risk will be reduced by further strengthening controls to the level expected and required.
To achieve this, standard of performance of personnel will be improved through training, motivation and recruitment.
The commercial team of Unilever Pakistan Limited will drive the business performance to achieve corporate targets; constantly improving the level of service and meeting the demands of the business.
We will take the lead in cost control, achieving and maintaining relative cost advantage against competition by radical improvement in supply chain and perusing the cost effectiveness plan including application of new technology.
Through focused attention and leveraging Unilever best practice in Risk Management a high standard of operational control will be achieved to protect the business.
Management information system will be constantly updated to meet changing business needs, providing optimal Quality Of management information.
The company is headed by the chairman who is assisted by a team of 7 members known as the manage committee, which is responsible for initiating policies and overall planning. As well as their general management duties the MC members are each responsible for a specific function. Reporting to MC members are the Departmental heads who are responsible for advising the MC for planning, implementation of policies and for ensuring that targets are reached.
The management of the company is composed of a mix of international and Pakistan s business professionals. The management of the company includes SYED BABER ALI as a director, who is also involved in many other organizations like Packages and other industries. One member from each province attends the meeting. The top management of the company is fully professional specially marketing department that is headed by Mr. JEFF LEE who has wide experience in this field.
WORKS MANAGER
SAEED MUSTAFA
PLANNER HPC
OPERATIONAL MANAGER
ASSISTAN.MANAGER ADMIN.SERVICES
FACTORY ENGINEER
CONTROLLER HPC
ERM
EMPLOYEES RELATIONMANAGER
JUNIOR MANAGER RD
SAEED AHMAD
AMIN SHAH
A.E R.MANAGER
ISMAIL TAHIR
PLANNING
PLANNER HPC
FAHEEM SHAH
JUNIOR MANAGER
ABDUL QADIR
JUNIOR MANAGER
SOHAIB MALIK
JUNIOR MANAGER
FAROOQ CHOHAN
ASSISTANT MANAGER
NAVEED RIFFAT
CONTROLLER HPC
A .MANAGER FINANCE
YAQOOB KHAN
CONTROLLER HPC
WASEEM AHMAD
A . MANAGER BUYING
M. MUSLIM
A. MANAGER COSTING
TARIQ YOUSEF
A.MANAGER APV
FAHIM SHAH
JUNIOR MANAGER
SYSTEM SUPORT
JUNIOR MANAGER
ASHFAQ AHMAD
COSTING
ASSISTANT MANAGER
COSTING
JUNIOR MANAGER
GHAFFAR ASIF
JUNIOR MANAGER
AHMAD SHEIKH
JUNIOR MANAGER
SAEED AHMAD
JUNIOR MANAJOR
Mr. ASHFAQ
FINANCE
JUNIOR MANAGER
SHAFIQ AHMAD
JUNIOR MANAGER
ARIF AZIZ
JUNIOR MANAGER
NIAMAT ULLAH
APV
ASSISTANT MANAGER
APV
CASHIER
ABDUL LATIF
JUNIOR MANAGER
IFTIKHAR AHMAD
JUNIOR MANAGER
SHAFATULLAH
JUNIOR MANAGER
ABDUL RAZZAQ
FACTORY ENGINEER
SHAHAB M ALI
A. MANAGER STORE
AHMAD MURAD
A. MANAGER PROJECT
IJAZ AHMAD
AREA ENGINEER
M. AMJID
A.MANAGER TECHNICAL
OPERATIONAL MANAGER
MUDASSAR CHEEMA
A.MANAGER PP/NSD
MUMTAZ JAVEED
JUNIOR MANAGER
NOOR MUHAMMAD
JUNIOR MANAGER
M .H. SOOMRO
JUNIOR MANAGER
SALIM IQBAL
JUNIOR MANAGER
MUNIZ VAHIDY
JUNIOR MANAGER
IJAZ NADEEM
OPERATIONAL MANAGER
JUNIOR MANAGER
M. NAZIR
ASSISTANT MANAGER
SALMAN GOHAR
SHAHID RAFIQ
JUNIOR MANAGER
GENERAL
JUNIOR MANAGER
PAN ROOM
JUNIOR MANAGER
SOAP / FINISHING
JUNIOR MANAGER
FINISHING T/ S
MUKRAM ALI
ALLAH DITA
SABIR HUSSAIN
MEHBOOB BAIG
ADNAN WARSI
SALEEM RAFI
TARIQ WAHAB
MEDICAL
DOCTORS
(JUNIOR MANAGER)
MEDICLE CENTRE
COMPANY STRUCTURE
EXECUTIVE COMMITTEE
The Executive Committee is responsible for agreeing priorities and allocating resources, setting overall corporate targets, agreeing and monitoring business group strategies and plans, identifying and exploiting opportunities created by Unilever's scale and scope, managing external relations at the corporate level and developing future leaders.
Leading the team are the chairmen of Unilever PLC and Unilever N.V., the parent companies. Other members are the global division directors for Unilever Best foods and Home and Personal Care; the Corporate Development Director; the Finance director and the Personnel director.
REGIONAL PRESIDENT
The regional presidents are responsible for delivering business results in their respective regions. Regional presidents report to either the director of the Foods division or the director of the Home and Personal Care division.
As members of either the Unilever Best foods or Home and Personal Care divisions, they play an important role in shaping divisional strategy and ensuring that regional strategies and plans are consistent with overall objectives.
ADVISORY DIRECTORS
The advisory directors are the principal external presence in Unilever's government. One of their key roles is to assure that government provisions are adequate and reflect best practice. The advisory directors comprise a majority of the members of certain key committees of the Boards. They attend the key quarterly meetings, committee meetings, conferences of the directors and the Executive Committee, as well as meetings with the Chairmen.
Unilever's senior corporate officers are responsible for ensuring that board meetings and board committee meetings are supplied with the information they need. So, for example, the chief auditor ensures that the audit committee has the necessary information, while the head of the corporate relations department keeps the external affairs and corporate relations committee informed.
MANAGEMENT STAFF
Managers 11
Assistant Managers 22
Juniors Managers 53
NON-MANAGEMENT STAFF
SOA 21
OA 07
Technical Grade A 60
Technical Grade B 87
Technical Grade C 57
Technical Grade E 42
Technical Grade F 29
448
General Grade A 08
General Grade B 20
General Grade C 09
General Grade D 12
General 00 02
PP / NSD-II 120 10
Material Store 22 02
Engineering 45 15
Lab 16 05
IRD / Flad 18 04
Establishment 15 01
Administration
09 01
Security 11 00
Distribution 07 07
Buying 00 02
Account 01 17
Medical 09 02
86
With the world fast becoming a Global Village and the Internet Information Technology Revolution, the issues of HUMAN RIGHTS and Working Condition are becoming significant important with each passing day.
Unilever can pride itself in having one of the most congenial and professional working environments of any company operating in Pakistan. Unilever is an equal opportunity employer and there is no discrimination on the basis of sex, caste or creed. All hiring and promotion decisions are taken on merit. All local laws are adhered to regarding different matters. Extreme emphasis is placed on worker safety and health
Personnel Department makes arrangements for the recruitments of the employees. For this purpose it collects information about the desired employee s functions and then defines the job requirements and job profile. The Personnel Department makes all the arrangements for the report meant of new employee, It sees better such employee is available in the organization or not. In case of no, it gives the advertisement in the newspapers. It also collects all the applications of the applicants. It also makes arrangements for test. The Personnel Department uses different tests for different applicants. After that it arranges the interviews for the succeeded applicants. Usually the interviews are bland of different types of interviews. These interviews include panel interview, structured questions etc. The background information about the succeeded applicants is also gathered by the Personnel Department
On the basis of experience and performance, they are promoted to higher managerial level; at higher level I have seen various MBA, CA, ICMA and also people who have spend years at Unilever. In order to provide incentives to employees at Unilever, cash rewards are also granted. The head of the department, on job basis gives bonuses. The function of promotion of the workers is also performed by ERD after consulting with the top management and analyzing the past record of the workers.
Job Assessment
At Unilever Pakistan Limited Performance Appraisal is prepared to check the performance of workers. It is like ACR (annual confidential report) in the government sector.
Integrity, honesty
Loyalty
On the basis of performance appraisal awards and rewards or punishments are given.
Accountability
Employees have to face inquiries or suspensions, if they are involved in activities which are not according to the goal of Unilever Pakistan Limited. They are often terminated from their jobs, if they are not performing well. They can be demoted from their ranks. In Unilever, promotion is granted on performance basis so they are also accountable if they are performing poorly.
If the employees are not obedient to their superior or involved in unethical activities, they have to face the circumstances. Severe punishment like demotion, firing and suspensions are given to nonperforming or low-performing employees.
Satisfaction Of Employee
Employees have a high morale. Top management is maintaining very cordial relationships with union leaders. Actually employees feel a part in the organization and its achievements.
The Unilever Pakistan Limited conducts the wages survey in the market and of the major competitors after every two years and compares the results with its own package and there is any difference then adjustment is made. The desire of Unilever R.F. is that its employees must be satisfied in every aspect because it has the opinion that satisfied employees are more productive as compared to dissatisfied. The Unilever gives 30 different types of allowances to its employees. Some of these are annual, some are semi-annual, and some are monthly while some are once in the whole employment period.
Unilever R.F. is much conscious about the health and safety. Proper equipments are available in all areas of the production where sensitive machinery is in operation. Furthermore, the organization has a well equipped Medical Center where MBBS doctors are available in order to meet with emergency cases.
The Personnel Department provides all possible instruments to all workers and it has the desire that every worker should use those instruments in order to avoid losses.
Long shoes
Helmets
Gloves
Fire Instruments
Unilever R.F. also provides certain benefits and services to all its employees. A list of some benefits and services is given below:
Attendance Allowance
Death Compensation
Canteen allowance
Tea Expenses
Conveyance Allowance
Utilities allowance
Meal Allowance
Rehabilitation Allowance
Retirement
Jersey
Shoes
Tonga Allowance
Traveling Announce
Hajj
The organization has a club for the employees of the organization. Indoor and outdoor facilities are also available. The company also celebrates Annual Sports Day on which different games are played and prizes are given to the succeeded players by the company.
Junior-level courses are frequently held in-house for personal training. Various courses organized in the past include the following,
This course was specially designed for middle management to enhance their principle-centered leadership qualities so that they could meet the emerging challenges of the global world. Neurolinguistic programming was part of the course to help the employee in day-to-day activities to improve proficiency and effectiveness in their attitude and work style.
This course was for those staff that is not proficient in written and verbal English language. An external instructor whose services were especially hired for this purpose conducted the course.
Professionals from Labor Department organized this course. The main purpose was to give acquaintances to the staff of their rights. Wage rates, vacations, working hours, child & bonded labor etc, were the main topics covered.
Unilever has also established an in-house Training School for unskilled labor so that they may be trained. Unskilled manpower is hired from the market for training. And during this period they are paid as per the prevailing wage rules.
The most important function performed by the ERD is the Human Resource Planning. For a smooth production there must be an effective Human Resource Planning. For This purpose it makes long term and short term plans to make the labor available for production. Short term Plans are made for those places where workers have gone on holidays or absent.
Badli
Temporary
For long term plans workers are recruited from the temporary workers who have become skilled one.
MOTIVATION
The organization has the opinion that motivated workers are more productive than unmotivated workers. To motivate its employees the organization uses both intrinsic and extrinsic approaches for motivation its employees.
o Intrinsic Approach
o Extrinsic Approach
INTRINSIC APPROACH
Job rotation
XTRINSICE APPROACH
Training
Appreciation letters
Bonuses
Cash awards
Gifts
Shields
Clocks
Put the name of the workers on the notice board who perform an excellent performance. To motivate the employees the organization has introduced a program name OFI (Opportunity for Improvement).
COMPANY S POLICIES
We updated Unilever's Code of Business Policies because we believe that our reputation for high corporate standards is a key asset which needs to be fresh and living throughout our business. The Code is published in full below.
Unilever has earned a reputation for conducting its business with integrity and with respect for the interests of those our activities can affect. This reputation is an asset, just as real as our people and brands.
Our first priority is to be a successful business and that means investing for growth and balancing shortterm and long-term interests. It also means caring about our consumers, employees and shareholders, our business partners and the world in which we live.
To succeed requires the highest standards of behavior from all of us. The general principles contained in this Code set out those standards. More detailed guidance tailored to the needs of different countries and companies will build on these principles as appropriate, but will not include any standards less rigorous than those contained in this Code.
We want this Code to be more than a collection of high-sounding statements. It must have practical value in our day-to-day business and each one of us must follow these principles in the spirit as well as the letter.
STANDARD OF CONDUCT
We conduct our operations with honesty, integrity and openness, and with respect for the human rights and interests of our employees.
We shall similarly respect the legitimate interests of those with whom we have relationships.
Unilever companies are required to comply with the laws and regulations of the countries in which they operate.
EMPLOYEES
Unilever is committed to diversity in a working environment where there is mutual trust and respect and where everyone feels responsible for the performance and reputation of our company.
We will recruit, employ and promote employees on the sole basis of the qualifications and abilities needed for the work to be performed.
We are committed to safe and healthy working conditions for all employees.
We are committed to working with employees to develop and enhance each individual s skills and capabilities.
We respect the dignity of the individual and the right of employees to freedom of association.
We will maintain good communications with employees through company based information and consultation procedures.
CONSEMRS
Unilever is committed to providing branded products and services which consistently offer value in terms of price and quality, and which are safe for their intended use. Products and services will be accurately and properly labeled, advertised and communicated.
SHAREHOLDERS
Unilever will conduct its operations in accordance with internationally accepted principles of good corporate governance. We will provide timely, regular and reliable information on our activities, structure, financial situation and performance to all shareholders.
BUSINESS PARTNERSE
Unilever is committed to establishing mutually beneficial relations with our suppliers, customers and business partners. In our business dealings we expect our partners to adhere to business principles consistent with our own.
COMMUNITY INVOLMENT
Unilever strives to be a trusted corporate citizen and, as an integral part of society, to fulfill our responsibilities to the societies and communities in which we operate.
PUBLIC ACTIVITIES
Unilever companies are encouraged to promote and defend their legitimate business interests.
Unilever will co-operate with governments and other organisations, both directly and through bodies such as trade associations, in the development of proposed legislation and other regulations which may affect legitimate business interests.
Unilever neither supports political parties nor contributes to the funds of groups whose activities are calculated to promote party interests.
THE ENVIRONMENT
Unilever is committed to making continuous improvements in the management of our environmental impact and to the longer-term goal of developing a sustainable business.
Unilever will work in partnership with others to promote environmental care, increase understanding of environmental issues and disseminate good practice.
INNOVATION
In our scientific innovation to meet consumer needs we will respect the concerns of our consumers and of society. We will work on the basis of sound science, applying rigorous standards of product safety.
COMPETITION
Unilever believes in vigorous yet fair competition and supports the development of appropriate competition laws. Unilever companies and employees will conduct their operations in accordance with the principles of fair competition and all applicable regulations.
BUSINESS INTEGRITY
Unilever does not give or receive, whether directly or indirectly, bribes or other improper advantages for business or financial gain. No employee may offer, give or receive any gift or payment which is, or may be construed as being, a bribe. Any demand for, or offer of, a bribe must be rejected immediately and reported to management.
Unilever accounting records and supporting documents must accurately describe and reflect the nature of the underlying transactions. No undisclosed or unrecorded account, fund or asset will be established or maintained.
CONFLICTS OF INTERESTS
All Unilever employees are expected to avoid personal activities and financial interests which could conflict with their responsibilities to the company. Unilever employees must not seek gain for themselves or others through misuse of their positions.
COMPLIANCE-MONITORING-REPORTING
Compliance with these principles is an essential element in our business success. The Unilever Board is responsible for ensuring these principles are communicated to, and understood and observed by, all employees.
Day-to-day responsibility is delegated to the senior management of the regions and operating companies. They are responsible for implementing these principles, if necessary through more detailed guidance tailored to local needs.
Assurance of compliance is given and monitored each year. Compliance with the Code is subject to review by the Board supported by the Audit Committee of the Board and the Corporate Risk Committee.
Any breaches of the Code must be reported in accordance with the procedures specified by the Joint Secretaries. The Board of Unilever will not criticize management for any loss of business resulting from adherence to these principles and other mandatory policies and instructions.
The Board of Unilever expects employees to bring to their attention, or to that of senior management, any breach or suspected breach of these principles.
Provision has been made for employees to be able to report in confidence and no employee will suffer as a consequence of doing so.
Path to Growth
Introduced in 2000, path to growth is Unilever s corporate strategic agenda which aims to double the size of the business in seven years and to grow profits faster than the competition, thereby ensuring that we are the leaders in similar type companies in providing top value to our shareholders.
The six strategic thrusts that make up the path to growth are;
By having real insights into consumer needs, preferences and future needs. This means knowing and understanding consumers lifestyles, habits and attitudes and creatively adapting brands to their changing needs.
2. Brand Focus
Grow their leading international brands by concentrating our resources behind them while still supporting golden regional brands and local jewels. Innovation will be the keystone to ensuring our brands are attuned to consumers future needs.
Widen their means of going to market i.e. reaching consumers and customers. This means developing new channels such as direct selling, home-vending, fashion outlets, travel, food service and out-of home.
To close the gap to global world class within three years by establishing brand synergies, superior logistics and supply chain and by establishing a world program.
5. Simplify
Everything that they do by reducing complexity, duplication and by making the best use of I.T. to provide high quality information once.
6. Enterprise Culture
By creating a culture which shapes the mindset and actions among all employees towards winning in the market-place by building an organization fit for growth.
TPM
Total productive maintenance is global standard of efficient production, which cuts waste, save money and make factories safer places to work. It gives machine operators the knowledge and confidence to investigate and eliminate root causes of machine error or breakdown as well as the chance to work in teams with managers to achieve improvements on product lines.
Unilever started introducing TPM sometimes known as Total Perfect Management or Total People Motivation in Japan in 1989 ahead of global roll-out program. Today, around 200 sites are using TPM techniques. The level one excellent award applies simply to the factory floor, consistently excellent is for sustained performance and the special award, much harder to achieve, also includes innovation, manufacturing, sourcing and distribution.
5 S s of Workplace Organization.
The 5 S s are a group of techniques to promote workplace organization, ensure adherence to standards and foster the spirit of continues improvement.
Objective: To get rid of unwanted items. Decide what is needed to be kept, and what is not needed and to be discarded.
Objective: To locate a specific place for specific items of a specific quantity, where needed. Determine addresses for materials and equipment. Put them in that place and keep them there.
Objective: To use cleaning to identify abnormalities and areas for improvement. Clean the workplace and at the same time visually sweep for abnormalities or out or control conditions.
Objective: To consolidate the first 3 S s by establishing standard procedures. Determine the best work practices and find ways of ensuring everyone does it the same best way.
Objective: To sustain improvements and make further improvements by encouraging effective use of the Check-Act-Plan-Do cycles. Keep all current improvements in place and develop an environment for future improvements.
PLANT LOCATION
Unilever Pakistan Limited (Rahim Yar Khan Factory) is situated at Leghari road near the main city. The factory deals in major three types of products, which are categories as under:
Personal Wash
Personal Products
Personal wash has a wide range of soaps and the main soap of Unilever Pakistan Limited is Life Buoy, Lux, Rexona and Fair & Lovely soap.
Personal product include Oral (Close Up tooth paste), Hair care (Sun Silk, Life Buoy) and Creams (Fair& Lovely and Ponds).
Laundry and Detergents includes Laundry (Surf Excel and Wheel) and Detergents (Vim bar and Wheel magic bar)
LOCATION
Location is the process of determining a geographical site for a firm s operation. Organizations must weigh many factors when assessing the desirability of a particular site that can be
Proximity to customers
Proximity to suppliers
Labor costs
Transportation cost
Unilever Rahim Yar Khan Factory is situated in the middle of the city. It was established in 1948.
The main reason for choosing this location for the factory was:
The land for the factory was donated by the NAWAB of the Bahawalpur State.
It was the central location of Pakistan so it was a convenient location from the distribution point of view.
PROXIMITY TO MARKETS
The site of R.Y. Khan Plant was chosen in 1948. The main reason was its central location. This location is the middle of Lahore and Karachi that were the main markets at that time. So the company can easily cover whole market fro Karachi to Lahore.
At that time the company was only producing oil for which cotton area was suitable. This site was suitable for processing the raw material that was cotton and R.Y. Khan was main cotton area.
It was the tax-free area. The land was gifted by the ABBASI family, so there was no real estate cost.
TRANSPORTATION COSTS
Transportation cost is also a major determinant, which directs the location decision. Transportation cost is a major factor not only in terms of the raw material but also in terms of raw material. As R.Y Khan is situated at the center of Pakistan, the movement of finished goods cost minimum here across Pakistan. R.Y. Khan Railway Station is situated along with the factory so transportation through rail is very easy.
PRODUCTS
BUSINESS
TEA
ICE CREAM
TEA
LIPTON
Lipton Yellow Label is the leading brand in Pakistan and is preferred by all who enjoy good tea. It s growing sales attests to the facts that the Pakistan is very quality conscious and is in fact a tea connoisseur. To cater to this growing awareness of quality, Lever Brothers Pakistan Limited have always lived up to its quality No.1.
To keep the tea fresh and flavorful, major initiative has been taken by introducing hermetically sealed packs. This has been appreciated tremendously by consumers and sales are continuing to grow. For every Lipton Yellow Label Tea consumer, the brand offers a rich, bright, fresh cup of tea that resounds The Sign of Good Tea .
BROOKE BOND
Millions across Pakistan enjoy supreme. A wide mix of people belonging to all walks of life loves its distinctive taste and flavor. The Red Supreme Pack with the bold yellow logo stands out at virtually all retail outlets across the country.
Supreme is also popular in both the urban and rural segments. The launch of the sachet made it accessible to many more consumers. Its new improved blend has further fine-tuned the brand with the requirement of the target segment and hence the claim The taste we call our own .
ICE CREAM
WALL S
In March 1995, history was made in Lahore. The launch of wall s ice cream created a new benchmark for successful FMCG launches in Pakistan. On August 14, the same year, Wall s came to Karachi and the city by storm. The success has now been repeated across the country. From a marketing point of view Wall s brought to Pakistan, the concept of branding consumer now ask for Cornetto, Feast, Max, and other brands, not simply for ice cream Products.
In July 1996, Polka, an established local name, representing the only national ice cream business was acquired by Unilever. At this time a rationalized plane is being finalized. In broad term, Walls will emerge
as the impulse brand whiles the Polka from Wall s brand will offer a new level of excellence in take home or desert ice cream.
POLKA
In 1996 Polka was acquired by Unilever and thus became an associated company of lever, the beginning of second year of Wall s in Pakistan. Polka as a brand had been a 25 year old ice cream of Pakistan, offering consumers dependable quality at value pricing. It was the only national ice cream, with production facilities or depots in various parts of the country, offering consumers several ice cream flavors and formats.
The acquisition of polka provides Unilever ice cream business in Pakistan the best of both worlds. The clear synergy arising out of the two distinct Brands is sure to move Unilever into the position of market leader, offering consumers an even stronger relationship with Unilever ice cream brands in Pakistan.
Surf Excel
Vim Scourer
VIM
Vim range of products, Vim Bar and Vim Scourer, offer Pakistani consumers quality dish washing in line with international standards. Over the year, Vim has developed strong equity with its consumer by providing powerful cleaning at affordable prices.
Initially, Lever entered the NSD bar market with Rin that become an instant success in a short period of time, However, in order to harmonize and strengthen the portfolio, the name Rin was changed to Vim in 1996. Today Vim stands for a superior quality dish wash brand that is environmentally friendly and in line with international quality standards. Plans to further strengthen the vim portfolio are being implemented.
SURF
Dominating the washing powders markets in Pakistan for four decades; Surf has continued to change according to consumer needs. Being a pioneer, Surf had to work hard to gain acceptance in the early days. To educate housewives about its use, house to house demonstration were organized in Lahore and Karachi. Free sample and coupons were also distributed to recruit consumer. There has been no looking back since the brand has undergone numerous product quality improvements to offer best cleaning results. Over the year, there has been a shift from cartons to poly ags and emergence of low unit price packs.
With continuous technological innovations, the brand has always managed to fight off competition. Surf Excel, which hit the shops recently, has already gained a reputation for the best in the market.
Dalda Banaspati
DALDA
It has been over 50 year since DALDA was introduced in this part of the world. Since then, It has gained a tremendous consumer franchise through out the sub continent, especially in Pakistan. Today, Dalda has under its umbrella a whole host of products aside from the healthiest Banaspati i.e., Dalda Cooking Oil and Dalda Sunflower Oil.
During 1998, Lever Brothers continued to pioneer in the Edible Oils and Fats category, by introducing Dalda VTF (Virtually Trans Free) Banaspati.
BLUE BAND
Unilever ioneered in 1985, by introducing margarine in Pakistan, under the brand name Blue Band. Since then, Blue Band has remained as locally produced margarine. Keeping in tune with consumer needs, a number of changes have been initiated in the past 14 years; in terms both the products as well as the marketing mix
During 1998, Blue Band was able to grow over and above the market growth rate, and clearly suggest that consumers in Pakistan are finally switching over from butters to a healthier alternative.
Personal wash
Lifebuoy
Lifebuoy Gold
Lux
Rexona
Personal Care
Skin Care
Ponds
Hair Care
Sunsilk Shampoo
Dental Care
Close-up
Pepsodent
LUX
The undisputed leader market for over a decade. Lux has gone from strength to strength since 1954. That was the year when local production of this remarkable successful toilet soap began. Lux happens to be the largest Lever brand globally, with its glamorous association with film stars providing a common link across the world. The secrets of the brand s success are that movie with the time and remain contemporary in every area.
The international compaign featuring popular film star has added the touch of glamour Lux has always been associated with.
LIFEBUOY
Incredible thought it may sound, seven Lifebuoy bars are sold in Pakistan every second. The brand has long legendary status in the country.
Recently, Lifebuoy has widened its range of products. The introduction of Lifebuoy Plus and Lifebuoy Gold has played upon the association with health to capture a more upmarket segment. The latest addition to the Lifebuoy range is a shampoo, which is also marketed in sachets to capture an entirely new market.
PRODUCTION UNITS
Different factories of Unilever Pakistan Limited are operating in different areas of Pakistan. Brief information about these units is given below:
The largest and the oldest of Unilever is situated in Rahim Yar Khan. Basically at this factory personal products, soaps, glycerin and dish wash bar are manufactured.
This factory was established in 1950 and it is situated in west Wharf area. Formerly it was owned and managed by Lipton Pakistan Ltd. In the last 43 years many modifications are made here. And the factory has expanded considerably. In this factory only tea is produced and packaged.
It is situated on Hub River in S.I.T.E. A&B Oil Industries established the factory in 1958 and the production of the vegetable oil began in 1962. In 1965 Lever acquired the factory. Banaspati, cooking oil and margarine are produced here and distributed all over the country.
This is recently established on Multan Road in district Kasur. The plant was commissioned in 1994 having the most modern and latest machines installed. Walls Ice cream is being manufactured here. LBPL, when acquired the Polka, also purchased its two factories, one in Lahore and other in Karachi.
Recently LBPL has acquired Rafhan Maize Products from Best Foods International.
The new Lever Black Tea Processing Plant has been set up at Dhodial, 12 km north of Mansehra on the main Karakoram Highway on 2.5 acres of land with the Processing Plant built-in area of 11,800 sq. ft. The plant is expected to process 50 kg per hour or approximately a ton of made tea a day.
The plant has cost Rs. 11 million whereas Rs. 12 million has been spent on the building and infrastructure. The plant has been inaugurated on 7th of September, 2001.
QUALITY CONTROL
Quality is the use of techniques and activities to achieve sustain and improve quality. It involves integrating the following related techniques and activities:
6. Utilization of these activities provides the customer with the best product or service at lowest cost. The aim should be continuous quality improvement.
OBJECTIVES
The continuous improvement of all services through total involvement of all employees.
The developing and the strengthening of partnership with external and internal customers and suppliers.
Providing innovative and higher quality products and services to achieve total customer satisfaction by understanding their requirements and anticipating their future expectations or needs.
FUNCTIONS
Creating a culture of customer focus striving to become the lowest cost producer through agreed annual cost reduction program.
Value people by understanding and drawing upon their strength i.e. abilities and knowledge and make efforts for their training and development.
STAGES
RAW MATERIAL:
When raw material is received the quality of raw material is inspected according to the standards. According to these standards if the personnel of receiving department will inspect according to the standards. If there are a lot of 500 and they choose 13 samples from the whole lot then they select the sample from the upper and lower and right and left side of the whole packet. It means that they select the sample by way of diversifying the area. If the 2 units of the sample are rejected then the whole lot will be rejected and if the lot is rejected then they call back the vendors and vendor check that lot again. If the lot is very much needed by the production department then they place a written request. The 100% inspection is done on it. In this case, they call the vendors or their inspectors and they check it on 100% basis. But this happens in very rare cases.
On the other hand if the lot is accepted then it is remarked as GRL (good received lot) and sent to the store. While four copies of GRL are made and sent to the following four departments:
1. Purchase Department
3. Store
When the product is in-line then quality inspector check it at every stage of process. If these inspectors will sign it for next process then product will go for next process. If they do not sign it then the work will stop. Then for the accepted and rejected production, the quality inspector will give report. This report has also included the sign of supervisor of process area. So that analyzing the rejection and acceptance %age for next rectification and improvement.
Then report will pass to the production manager so on this base they can make the weakly and monthly report. And it will pass to the top management. In this inspection is done at every stage and will pass towards the top management. The ISO has given them standard for the whole process. It also includes the initial cost but the running cost is more safe and effective because the chances of rejection are reduced. We can say that the chances of rejection will be controlled. In this way the quality level is much improved and it reduces the customer complaints. Monthly charts are also made and management also takes correction actions.
If there is a need of corrective action then they will request. The immediate action will be taken on that form and until the corrective action will not be taken they production level will be ceased.
Quality control department has given their dimensions. And if there is any deviation from these dimensions then even the MD of the company cannot start the production. And charts are also following these dimensions everywhere in the production area.
MAIN SUPPLIERS
Unilever Pakistan Limited is associated with Packages Pakistan in terms of Packaging Boxes.
Unilever Pakistan Limited is associated with I.C.I. in terms of chemicals and seeds.
Unilever Pakistan Limited is associated with BLAZON ADVERTISING, ADSERVICE in terms of Television Adds.
Unilever Pakistan Limited is associated with ITTEHAD CHEMICALS in terms of chemicals supplies.
Unilever Pakistan Limited is associated with NEW KHAN GOODS FORWARDING & GODOWNS in terms of Transportation and over Flow Depot. (OFD).
Unilever Pakistan Limited is associated with AVARI TOWERS in terms of offices of Directors in Karachi.
Unilever Pakistan Limited is associated with HENERY OILS & FATS OF AUSTRALIA in terms of Soybean Oil, Animal fats.
marketing mix
MARKETING MIX
Product
Price
Place
Promotion
Product
Product is what is perceived to be. Thus a product is more than something with physical characteristics. In a very narrow sense a product is set of tangible physical assembled in an identifiable form.
Unilever has a wide range of its product. Unilever conduct a regular research and surveys on the changing habits of the taste of the customer. Results are then given to special research and development department and accordingly new product are lounged and even alternations in the existing products are done. Their policies are usually between innovative and initiative categories of new products developments
This company has a unique product and a no of product and here are the some details for them.
Personal wash
Tea
Ice cream
PERSONAL WASH
TOILET SOAPS
Rexona (3 varieties)
Breeze
FABRIC WASH
Ultra Surf
Surf micro
Surf Excel
Power Surf
HOME CARE
Vim Bar
Vim Powder
PERSONAL PRODUCTS
HAIR CARE
SKIN CARE
Ponds talc
DENTAL CARE
BANASPATI
Dalda banaspati
COOKING OIL
MARGARINE
INDUSTRIAL FATS
A whole range of products for the bakery & oils for the industry.
TEA
LEAF TEA
Yellow Label
Richbru
Top Star
Taaza Leaf
Supreme
DUST TEA
Pearl Dust
Ruby Dust
A1
MIXTURE TEA
Taaza
ICE CREAM
Cornetto (3 varieties)
Feast (2 varieties)
Feast Stickless
Top Ten
Callipo
Split
Fruiti
3-D
Solo (3 varieties)
Polka Cup
Panda
Dracula
Family Packs
Lifebuoy gold
Close up toothpaste
TEA
LIPTON
Lipton Yellow Label is the leading brand in Pakistan and is preferred by all who enjoy good tea. It s growing sales attests to the facts that the Pakistan is very quality conscious and is in fact a tea connoisseur. To cater to this growing awareness of quality, Unilever Pakistan Limited has always lived up to its quality No.1.
To keep the tea fresh and flavorful, major initiative has been taken by introducing hermetically sealed packs. This has been appreciated tremendously by consumers and sales are continuing to grow. For every Lipton Yellow Label Tea consumer, the brand offers a rich, bright, fresh cup of tea that resounds The Sign of Good Tea .
BROOKE BOND
Millions across Pakistan enjoy supreme. A wide mix of people belonging to all walks of life loves its distinctive taste and flavor. The Red Supreme Pack with the bold yellow logo stands out at virtually all retail outlets across the country.
Supreme is also popular in both the urban and rural segments. The launch of the sachet made it accessible to many more consumers. Its new improved blend has further fine-tuned the brand with the requirement of the target segment and hence the claim The taste we call our own .
ICE CREAM
WALL S
In March 1995, history was made in Lahore. The launch of wall s ice cream created a new benchmark for successful FMCG launches in Pakistan. On August 14, the same year, Wall s came to Karachi and the city by storm. The success has now been repeated across the country. From a marketing point of view Wall s brought to Pakistan, the concept of branding consumer now ask for Cornetto, Feast, Max, and other brands, not simply for ice cream Products.
In July 1996, Polka, an established local name, representing the only national ice cream business was acquired by Unilever. At this time a rationalized plane is being finalized. In broad term, Walls will emerge as the impulse brand whiles the Polka from Wall s brand will offer a new level of excellence in take home or desert ice cream.
POLKA
In 1996 Polka was acquired by Unilever and thus became an associated company of Unilever, the beginning of second year of Wall s in Pakistan. Polka as a brand had been a 25 year old ice cream of Pakistan, offering consumers dependable quality at value pricing. It was the only national ice cream, with production facilities or depots in various parts of the country, offering consumers several ice cream flavors and formats.
The acquisition of polka provides Unilever ice cream business in Pakistan the best of both worlds. The clear synergy arising out of the two distinct Brands is sure to move Unilever into the position of market leader, offering consumers an even stronger relationship with Unilever ice cream brands in Pakistan.
VIM
Vim range of products, Vim Bar and Vim Scourer, offer Pakistani consumers quality dish washing in line with international standards. Over the year, Vim has developed strong equity with its consumer by providing powerful cleaning at affordable prices.
Initially, Unilever entered the NSD bar market with Rin that become an instant success in a short period of time, However, in order to harmonize and strengthen the portfolio, the name Rin was changed to Vim in 1996. Today Vim stands for a superior quality dish wash brand that is environmentally friendly and in line with international quality standards. Plans to further strengthen the vim portfolio are being implemented.
SURF
Dominating the washing powders markets in Pakistan for four decades; Surf has continued to change according to consumer needs. Being a pioneer, Surf had to work hard to gain acceptance in the early days. To educate housewives about its use, house to house demonstration were organized in Lahore and Karachi. Free sample and coupons were also distributed to recruit consumer. There has been no looking back since the brand has undergone numerous product quality improvements to offer best cleaning results. Over the year, there has been a shift from cartons to poly bags and emergence of low unit price packs.
With continuous technological innovations, the brand has always managed to fight off competition. Surf Excel, which hit the shops recently, has already gained a reputation for the best in the market.
DALDA
It has been over 50 year since DALDA was introduced in this part of the world. Since then, it has gained a tremendous consumer franchise through out the sub continent, especially in Pakistan. Today, Dalda has under its umbrella a whole host of products aside from the healthiest Banaspati i.e., Dalda Cooking Oil and Dalda Sunflower Oil.
During 1998, Unilever continued to pioneer in the Edible Oils and Fats category, by introducing Dalda VTF (Virtually Trans Free) Banaspati.
BLUE BAND
Unilever pioneered in 1985, by introducing margarine in Pakistan, under the brand name Blue Band. Since then, Blue Band has remained as locally produced margarine. Keeping in tune with consumer needs, a number of changes have been initiated in the past 14 years; in terms both the products as well as the marketing mix.
During 1998, Blue Band was able to grow over and above the market growth rate, and clearly suggest that consumers in Pakistan are finally switching over from butters to a healthier alternative.
LUX
The undisputed leader market for over a decade. Lux has gone from strength to strength since 1954. That was the year when local production of this remarkable successful toilet soap began. Lux happens to be the largest Unilever brand globally, with its glamorous association with film stars providing a common link across the world. The secrets of the brand s success are that movie with the time and remain contemporary in every area.
The international compaign featuring popular film star has added the touch of glamour Lux has always been associated with.
LIFEBUOY
Incredible thought it may sound, seven Lifebuoy bars are sold in Pakistan every second. The brand has long legendary status in the country.
Recently, Lifebuoy has widened its range of products. The introduction of Lifebuoy Plus and Lifebuoy Gold has played upon the association with health to capture a more up market segment. The latest addition to the Lifebuoy range is a shampoo, which is also marketed in sachets to capture an entirely new market.
Price
The product s price varies from product to product. Here the firms have to consider many factors for determining the price.
Determining demand
Estimating costs.
Price is simply the cost plus profit of the firm. There are many competitors in the market. So the firms have to consider about the competitive price while selecting new price and schemes.
PRICING OBJECTIVES
Unilever prices its product to achieve a certain percentage of return on its investment. The base of pricing is the time consumed in the production process and target revenue per day.
Unilever sets its prices in such a way to increase the volume of sales.
Unilever usually has the policy of setting high prices since it is a leader in food market. They have fixed prices products due to the reliability of consumers towards price. Prices are decided keeping in view the prices of other products of same size, category and types.
Pricing Strategies
The company uses the same delivered price to be charged from all distributors.
Under this policy, the company bears all the freight out cost for FOB only.
All the sales of the company are on the cash basis and no credit facility is given to its customers i.e. distributors.
Price to Distributors
The company provides products to the distributors for the prices decided keeping in view the cost, the target revenue and competitors prices.
Unilever gives margin of certain percentage to distributors so in this way prices to be charged by distributors to retailers are fixed.
Company influences prices charged by retailers. So retailers are bound to charge fix price to ultimate consumer
Prices are set by taking into consideration into the prices of the competitors.
As there products are highly quality.so usually they charge high prices.
Cash discounts.
A cash discount is a price reduction to buyers who pay their bills promptly. A typical example is 2 /10 net 30. Which means that payment is due within 30 days and that the buyer can deduct 2 percent by paying the bill within 10 days. Such discounts are customary in nature.
Quality discounts.
A quantity discount is price reduction to those who buy large volumes. This is given to increase company sales. So that firm can have more revenues.
Functional discounts.
These are also called trade discount which is offered by this particular firm. It will be given to those who perform certain function Such as storing, selling book keeping.
Seasonal discounts.
A seasonal discount is a price reduction to buyer who buys merchandise out of season. They offer different discount on springs and on summer.
Allowances.
Allowances are extra payments designed to gain reseller participation in special programs. Trade discount is price reduction granted for turning in a old item when buying a new one. Trade in allowances is most common.
Promotional pricing.
Instead of cutting its price, the company offer customer low interest financing.
Rs.22/-
Place
Registered office
Avari plaza,
Karachi.
Laghari road
Placement / Promotion
Promotion consist of a diverse collection of incentive tools, mostly short term, designed to stimulate quicker and greater purchase of particular product/services by consumer as the trade.
Unilever Pakistan Limited places their products in local as well as in foreign market. They export directly and indirectly. Unilever promote their products through media, and other trade incentives to distributors and wholesalers.
Company logo type is one of the major products. But not on products with the small levels where the space is needed to present both information required by the government and other information they believe is helpful to the consumer.
Company name or the logo type is usually shown in most prints add in magazines and newspapers.
LABELING
Brand label
Descriptive label
ADVERTISING STRATEGY
MEDIA USE
Unilever Pakistan Limited use radio, TV and Billboards and newspapers for advertising purposes.
Cost benefit
More access
PROMOTION CAMPAIGN
Promotional activities provides chance to company to communicate with the potential consumer to Beat the drum about it products.
The company sets up the store displays and sales officers make sure that items displayed are properly arranged so that they can look attractive on eye contact level.
Company arranges their stalls in the exhibition at which the products are displayed and sold at discounts.
Sometimes the company enters in the cooperative advertisement with other companies and the logos of such companies are printed on Unilever gifts that are given free along with the product of those other companies.
The company gives off seasonal schemes of discount to distributors with an objective that the benefit of discount should be passed to retailers and wholesaler.
Promotion methods.
Advertising.
Newspaper .
Magazines.
Television.
Radio.
Road display.
Sales promotion
Coups.
Premiums.
Samples.
Trade shows.
Co-operative.
Personal selling.
Order gelter.
Order takes.
Sport sales.
Publicity.
News.
Features.
Others.
MARKET SEGMENTATION
The management of a company has differentiated its product through its prestigious brand name as compare to other local companies.
It launched uniform and standardized product therefore, there is no need for market segmentation because the wants and other characteristics (i.e. geographic, demographic and buying behavior) of their target market are somewhat similar.
Unilever has adopted the strategy of market aggregation. It views its target market as a single unit i.e. one mass marketing strategy for its product line. Unilever s target market includes Middle Class, Upper Middle Class and Upper Classes of the population of Pakistan.
MARKETING RESEARCH
Infact there is no separate department for marketing research. The marketing executives are responsible for the research work. Every executive have assigned one brand, for the purpose of research and is responsible to report their research work about any modification of their respective product.
MARKETING POSITIONING
Unilever is considered to be a trusted and premium brand because of its unique association. Unilever is positioning their product in the best of their customer satisfaction which also differentiate from their competitors.
BRANDING STRATEGIES
Marketing entire out put under producer brands. Unilever is marketing all of its products under its own brand name.
BRAND NAME
Sunsilk
Lifebuoy
Lux
Bestfoods
Dalda
BRAND EQUITY
Colour
Unilever s colour by itself is a selling advantage. For the sake of variety they have full coloured products. Like lux is available in different colours.
Quality
Unilever maintains the high standards of quality of its products for the entire target market, which creates a strong image in the consumer s mind.
Warranty
It is the policy of the company that it replaces the products damaged due to manufacturing or quality fault whenever claimed.
PACKAGING
In Unilever packaging the product line is done according to the product nature. In order to have attractive and impressive packaging, company uses the services of various packaging agencies such as Packages. For the benefit of the consumers, care instructions are also given on the package. Unilever also uses multiple packaging strategies for its products.
LABELING
Brand label
Descriptive label
COMPETITION
COMPETITIVE STRATEGIES
Unilever Pakistan Ltd. provides trade incentives to distributors and customers against competitors. They also provide various schemes to attract the customer.
Unilever act on a strategy of producing and selling large quantities of quality products, that s why they are able to keep the unit costs low and offer need satisfying products at attractive prices. Unilever develop produces and deliver affordable products with enough variety and uniqueness that nearly every potential customer can have exactly what he wants, Unilever is a quality conscious firm, they never compromise on quality that s why their products are No. 1 in the market and they are market leader.
Distributors
Distributors are the institution through which availability of products is possible. Unilever s distributors have a very good relationship with them. and the important thing is that they must integrated into total marketing mix because of time and money required to setup an efficient channel.
The main procedure of distribution of distribution is that first it goes to warehouse and then to distributor and at last to ultimate consumer.
While the selection of channel company considers customer buying patterns and the nature of the market. However company should follow the creation of three control market coverage and cost that is constant with the desired level of consumer service.
DISTRIBUTION STRATEGIES
Consumer
Retailer
Distributor
Company
Retailer
Consumer
Wholesaler
Company
Unilever uses a lot of distributors and retailers to supply its products in each market where the final customer might reasonably look for it. While appointing a distributor for a particular area, management uses its own judgment to select such a person that has a potential to operate effectively.
FNANCIAL ANALYSIS
The particular objectives sought to the served by financial analysis determine the type of ratios as well as the extent and depth of ratio analysis to be carried out to draw conclusions. Financial analysis is carried out by;
Business Concern:
Management:
Investors:
Bankers/Creditors Concern:
Debt coverage.
Government Concern:
REDEEMABLE CAPITAL
DEFERRED LIABILITIES
CURRENT LIABLITIES
Current maturity of liabilities against assets subject to finance lease 3796 2371 000
(Rupees in Thousands)
1999 2000
2001
TANGIBLE ASSETS
Trade marks 34 34 34
274400
CURRENT ASSETS
186806
2245458
Sales
Other income
43620 43987
1906218
Appropriation
478 239
A number of different approaches might be used in analyzing a firm s financial performance in a particular period. To analyze the performance of UNILEVER PAKISTAN LIMITED. I adopted following three method of
1. Ratio Analysis
3. Trend Analysis
RATIO ANALYSIS
Ratio Analysis is an important and age-old technique of financial analysis. It simplifies the comprehension of financial statements. Ratios tell the whole story of changes in the financial condition of business. Ratios highlight the factors associated with successful and unsuccessful firm. They also reveal strong firms and weak firms, over- valued and under valued firms.
It helps in Planning and forecasting. Ratios can assist management, in its basic functions of forecasting, planning, co-ordination, control and communication. Ratio analysis also makes possible comparison of the performance of different divisions of the firm. The ratios are helpful in decision about their efficiency of otherwise in the past and likely performance in future. Ratios also help in Investment decisions in case of investors and lending decisions in the case of bankers etc.
Types of Ratios
Following the main types of ratios that we are going to calculate in this assignment,
Liquidity Ratios
Leverage Ratios
Activity Ratios
Profitability Ratios
Coverage Ratio
LIQUIDITY RATIOS
Liquidity ratios are used to measure a firm s ability & solvency of the firm to meet short-term obligations. They compare short-term obligations to short-term resources available to meet these obligations
Current Ratio.
Current Ratio:
Current ratio shows a firms ability to cover its current liabilities with its current assets.
Current Liabilities
4541238
3992286
5723098
INTERPRETATION:
Current ratio shows the liquidity position of the company. It represents a margin of safety or cushion available to the creditors. It is an index of the firm s financial stability. It is also an index of technical solvency and an index of the strength of working capital. The ideal Current ratio is 2.1 but this condition is applicable only when demand is very high, inflation is zero, default risk is low & economic conditions are better. It was observed that current ratio in 2001 was 0.89, in year 2000 was 1.00, , & in year 1999 was 0.99. It was increasing over the year but this ratio was decreased in 2001. So a relative low value of the current ratio is considered as an indication that the firm will find difficulty in paying its obligations.
Acid test ratio shows a firms ability to meet current liabilities with its most liquid (quick) assets.
Current Liabilities
4541238
3992286
5723098
INTERPRETATION
Quick ratio is very useful in measuring the liquidity position of the firm. It measures the capacity of the firm to pay off current obligation immediately and is a more rigorous test of liquidity than current ratio.
The acid test ratio of Lever Brother was 0.26 in year 1999 & 0.35 in 2000 & 0.52 in year 2001 .The industry average ratio is 1:1 so it shows that company has very ways liquidity position because its liabilities are greater than its assets.
Debt to equity ratio indicates the relationship between the external equities or outsider finds and the internal equities or shareholder fund. It is calculated to assess the extend to which the firm is using borrowed money.
Shareholder s equity
1460672
1258602
1199958
INTERPRETATION
The debt to equity ratio indicates the investment by outsiders in the company with relation to the equity of shareholders. The industry average ratio is 60:40, so from this point of view, Unilever s debt to equity ratio was 21% in year 1999 and 79% in 2000 and 16% in 2001. Unilever have excellent debt to-equity ratio in year 2000 but this ratio decreased in year 2001 which is not good for the company. So it has much impact on the financial position of the company. The creditors would generally like this ratio to below because lower the ratio, the higher the level of firm s financing that is being provided by shareholders & the larger the creditor cushion in the events of shrinking assets values or outright loss.
This shows a debt financing to a firm by showing a percentage of assets that are supported by debt financing. This ratio servers a similar purpose to debts to equity ratio. It highlights relative importance of debt financing to the firm by showing the percentage of the firm s that is supported by debts financing.
Total Assets
6564046
6503082
7363828
INTERPRETATION
It shows how much sufficient our assets are in retiring the total debts .The debt to total assets ratio of Unilever was 4.6% in year 1999 ,15.3% in the year 2000 and 2.72% in 2001. So it indicate that company s debts had been increased in 2000 to a considerable extent & that was not a satisfactory condition for company. but by using special policies company has controlled this ratio and it has been decreased in year 2001 from 15.3% to 2.72%.
In case, higher the debt-to-total assets ratio, greater the financial risk, so the lower this ratio, the lower the financial risk of the company that is good for company.
This ratio tells us the relative importance of long-term debt to the capital structure of the firm.
1760672
2258602
1399958
INTERPRETATION
The long term debt to total capitalization ratio show the percentage of long term debt to the total capitalization of the company.
The company ratio was & 17.0% in year 1999, 44.3% in the year 2000, and 14.29% in 2001. By analysing these ratios. I can say that company s ratios were satisfactory in 1999 & 2001 years but it has increases in 2000 year due to heavy debts taken by the company.
ACTIVITY RATIOS
Activity Ratios are also known as the efficiency ratios & turnover ratios that measure how effectively the firm is using its assets.
Receivables turnover.
Inventory turnover.
Receivable Turnover
The receivable turnover ratio provider insight into the quality of the firms receivables & how successful the firm is in its collection so
Receivables
1999 19366254 = 48
404741
2000 20508216 = 44
469911
2001 20025445 = 45
449023
INTERPRETATION
A receivable turnover of Unilever was 48 in 1999 year and 44 in 2000.and 45 in 2001. The turnovers of Unilever was satisfactory because this showed the number of terms, accounts receivable have been turned over during the year. The higher the turnover, the shorter the time between the typical sale & cash collection.
The average collection period tells us the average number of days that receivables are outstanding before being collection.
Receivable Turnover
48
44
45
INTERPRETATION
The average collection period of Unilever was 7 days in 1999 and 8 days in 2000 and 2001. which shows that company collection its funds, aversely within a week. It means chances of bad debts is lower. Although too high an average collection period is usually bad, a very low average collection period may not necessarily be good. A very low average collection period may be a symptom of credit policy that is excessively restricted.
The days receivable figure shows the average number of days sales remain uncollected. This ratio reflects both the efficiency of management in collecting receivable and the credit policy, which the company maintains with its customers. For many companies, there will be one to two month s receivable outstanding. When the amount gets higher than two months, the quality (that is, the likelihood of collection) of the receivable may be affected and the company may have to raise additional funds to carry the larger amount of outstanding.
It is also important to estimate if there is a large sum of receivables outstanding, which is uncollectable. This may that the management is poorly organized and unable to collect receivables when due. It may show that the industry is very competitive; or, it may show that the company does not have a proper distribution net work and is giving credit to all distributor it can find to carry its product. or, it could mean that some of the customers are in financial difficulty. Furthermore, if some receivables are uncollectable, it means that the company s profits have been overstated unless a reserve for bad debts is created.
Inventory Turnover
Inventory turnover ratio is used to determine how effectively the firm is managing inventory.
So
Average Inventory
3031248
2509030
2116257
INTERPRETATION
The inventory turnover of Unilever was 5 times in years 1998, 6 times in 2000 and 7 times in year 2001This shows that company averagely maintains is inventory 6 time in a year. The inventory turnover of company is satisfactory.
Generally, the higher turnover, the more efficient the inventory management of the firm. Relatively low inventory is often a sign of excessive, slow moving, & obsolescent items in inventory.
Inventory Turnover
INTERPRETATION
The inventory turnover of company was 73 days in 1999,61 days in year2000 and 52 days in year 2001. This shows that average inventory turnover of company is 62 days. That is sufficient to the company to take & hold the inventory & later used it more effectively.
This ratio tells us the relative efficiency with which a firm utilized its total assets to generate sales.
Total Assets
6564046
6503082
7363828
INTERPRETATION
It shows that firms must manage its total assets efficiently and should generate maximum sales through their proper utilization. As the ratio, increases there are more revenue generated per rupee of total investment in asset. The firm ability to produce a large volume of sales on a small total asset based is an important part of the firms overall performance in terms of profits. This ratio is satisfactory for company. It was 2.95 in year 1999, 3.15 in the year 2000 and 2.72 in year2001.
PROFITABILITY RATIOS:
Profitability ratios are of two types, those showing profitability in relation to sales to this showing profitability in relation to investment. These ratios indicate the firms overall effectiveness profitability in relation to sales.
Net sales
19366254
20508216
20025445
INTERPRETATION
Gross profit margin tells us the ratio of profit turned on sales. Unilever gross profit margin is quite fluctuating. Company s gross profit margin has been increased in 2000 and in 2001. It may be due to increased in sales. This ratio also tells us the profit of the firm relative to sales after we deduct the cost of producing the goods. So it is a measure of the efficiency of firms operations as well as an indication of low products are priced. So company is doing very good business.
The net profit margin is a measure of the firms profitability of sales after taking account of all expenses to income taxes.
Net sales
19366254
20508216
20025445
INTERPRETATION
Unilever net profit margin is quite fluctuating over the years. It was 3.94% in year 1999, 6.5% in year 2000 and 6.1% in year2001.As net profit margin shows profit after paying taxes so it depended on better cost control, efficient margin, market opportunity & determent of debts.
Return on equity
This ratio compares unfavourably of the industry. Higher profitability leads to lower return on assets.
Total Assets
Years ROA
6564046
6503082
7363828
INTERPRETATION
The return on total assets tells us how efficiency assets have been used in carving income. Higher is the ratio, higher will be the profitability of organization. So Unilever return on total assets is satisfactory though it is fluctuating.
Return on Equity
This ratio tell us the carving power on share holders book value inventory & is frequently used in comparing two or more firms in as industry.
Shareholders equity
Years ROE
1460672
1258602
1199958
INTERPRETATION
A high return on equity after reflects the firm acceptance of strong investment opportunities & effective expense management. However if a firm has chosen to employ a level of debt that is high by industry standards, assuming exercise financial risk.
VERTICAL ANALYSIS
VERTICAL ANALYSIS
The term vertical analysis refers to a static measure that is frequently used in referring to ratios for one year data or for one year of accounting period. These analyses can be compared over a number of years .
Balance Sheets
Assets:
Current Assets:
Vertical Analysis
Balance Sheets
In calculating the vertical analysis of Unilever Pakistan Ltd , total assets has been taken as base figure & all other items have been divided by total assets, to show the percentage of that items to total assets. So from this analysis, I see that
Share Capital
The share capital was 10.24% in 1999, which means that company lacks cash to meet its debts. It has little increased in 2000 but in year2001 it has again reduced.
Reserves
The reserves of company were increasing in previous two years, which was good for the company in paying of its debts. But in year 2001 the reserve has decreased and it reduce the company s ability to pay its debts.
Un-appropriated Profit
The un-appropriated profit of company was 5.48% in 1999 so it was better for company to increase it. But again in 2000 & 2001 it has decreased that is not good for the company.
The surplus was decreasing over time, so it was good up to some extent for company.
These were also decreasing so these were good for company. Because this liability is reducing and this will be result in solvency of company. So In 2000 & 2001 there were no liabilities against assets subject to finance lease.
DEFERRED LIABILITIES
These were decreasing overtime so these were resort in greater profitability of the company. The major reason for a decrease may be that the company is trying to increase its reserves, so that company can pay its debts at the time when it rises.
Current Liabilities
All the current liabilities of company were decreasing except the accrued liabilities which were increasing in 1999. The basic reason for a decrease in liabilities may be that long terms as well as short term loans of the company are less.
Hence, in over all sense, we can say that liabilities are on decreasing part & assets are on increasing trend, although, some of the current assets such as cash & Bank balance were decreasing but it has little
increased. The main reason for a decrease in these assets may be that less assets are in progress as well as the demand of some products is decreasing due to fluctuations in prices.
Assets
Operating Assets
The operating assets of company were 26.42% in 1999, 26.96% in 2000 & 20.09% in 2001.By analysing these figures. I can say that operating assets of company were increased in 2000,but decreased in 2001.The basic reason for a decrease in operating assets in 2001 may be the terrorist attack on world trade centre that have appeared in that year.
The capital work in progress of the company was increasing over the number of years, so it was good for company. It was decreased by in 2000 but due to the good management policies it again increased in the year 2001.
The long term investment of company was 1.46% both in 1999 & 2000 &1.29 in 2001. As it indicates that investment of the company was good in the previous years but it decrease in the year 2001.The main cause for a decrease in long term investment in 2001 may be the political instability so because of this, the company was investing less in business.
As company s profitability is of major concern for the creditors and the long-term deposit & prepayments of the company was increasing over time, which is a good sign for company s profitability. In 2000 it was increased by 1.74% from the previous year.
The long-term loans of company were 0.50% in 1999 and in 2000 it was decreased to 0.46%. This shows that company s long term loans are decreasing. But in the year 2001ther is a slight increase in the long term loan of the company and these are 0.48%.
CURRENT ASSETS
The stores & spares of company were 2.87% in 1999, 2.72% in 2000 &1.63% in2001. In 2001 stores & spares decreased due to finances problems which not a healthy sign for company.
Stock in Trade
The stock in trade was more in 1999 as compared to other two years so it leaded to the profitability of company. The main reason for an increase in stock trade may be that fewer assets were used for carrying out the production but in 2001 & 2001 more assets were used so it started declining again.
Trade Debts
The trade debts were also the receivables of the company & it was increasing over time. But it decreased in 2001.So it is good for company. As the investment is low so the company is giving credit to its customers so that cost can be recovered soon.
Loans & advances were decreasing in previous two years but in 2001company s long term loan and advances has increased as compared to other two years so it is not a healthy sign for company s prosperity. because the debts of the company have increased decreasing.
The trade deposits & short-term prepayment were increased in 2000 as compared to the previous year, which means that the company had enough cash to meet its debts. But it sudden decreased in2001.
Other Receivables
The receivables of the company were2.42% in 1999, 3.33% in 2000 and 3.56% in2001.These were increasing which shows that the company is giving credit to its customers, in order to generate funds for carrying out the operations.
These were also on increasing, which resorted in increased profitability of company, but in 2000 &2001 it was decreased by as compared to 1999 due to weak profitability.
The cash & bank balance was 1.06% in 1999. It was decreasing overtime so it was not good for company because it reduced the solvency of the company. But due to cash received from receivables it increased in 2000 (7.63%) and in2001 (30.49%) and company has more cash and bank balance.
SALES
Other income
In calculating vertical analysis of profit & loss accounts, sales are taken as base and all other items are divided by the sales which show the percentage of that item to the sales.
Sales
The sales of company was 100% in each year that means company sold all the things that it made with a particular period of time so it is a healthy sign for company s prosperity.
The cost of good sold was 77.45% in 1999, 75.04% in 2000 &73.21 in 2001. The cost of goods sold was decreasing over time and it should be less because purchasing in bulks provided economics of scale to manufacturers.
Trading Profit
Trading profit of company was increasing and it was good for company. The basic reason may be that sales are more where as cost of goods sold is less over the year.
These expenses were increased in 1999 but start on decreasing so these do not provide healthy sign for company s prosperity, but it does mean that the position of the company is not good. The basic reason for a decrease in these expenses may be the effective cost control of the company over these expenses.
The profits of company & other income were increasing and it may be due to proper cost control. This is a very healthy sign for the company.
Financial Expenses
The financial expenses of company were decreasing over time so it is good for company. It means that the company has effective cost control over the expenses. But in year 2001 company s financial expenses have increased as compared to previous year.
Auditor s Remuneration
Auditor s remuneration is increasing over the year but there is a little increase every year which has no significant effect on the company position.
These were increasing which provided a healthy sign for company s growth. Because when these funds would raise then more workers would satisfied, and then productivity of the company would increase.
Both of these were good because these are increasing over the year and it increased the profitability of company.
Profit after taxation was increasing but in the year 2001 it has decreased due to increase in the restructuring cost.
Hence I can say that the company is exercising effective cost control over its operations & it is also having increased profit over the years.
Balance Sheets
For the years 1999, 2000 & 2001 Shares Capital & Reserves: 2000 (%) 2001(%)
Share capital -
Deferred Liabilities:
43.83
Current Liabilities:
Current maturity of liabilities against assets subject to finance lease (37.5) 233
2000% 2001%
Assets:
Trade marks -
Current Assets:
Other receivables
15.8 21
Balance Sheets
In horizontal analysis of Balance Sheets , I calculated the change by subtracting the value of year 2000 to the value of year 1998 &, the difference is then divided by the value of the year 1999 and finally he result is expressed as a percentage, the same procedure is used for calculating the (%) age change in the year 2001.
ASSETS
The operating assets and capital, work in progress at cost are decreasing over the years, whereas the strong reason for a decrease in capital work in progress may be that there are some strikes and lighting problems etc.
The long term investment has no change in its value over the year but long term deposits and prepayments of the company has increased in 2000 but it decreased in the year 2001, long term loans of the company has also increased in the year 2001.
The basic reason for increase in long term loan may be that the company is giving less dividends to the shareholders.
CURRENT ASSETS
The stores and spares of the company were increased in 1999 year & 2001. The main reason for this may be that W.I.P was decreasing, so inventory was not in used and because of this, sales were also decreasing over the years. But as sales increased in 2000 it started to decline again.
Stock In Trade
The stock in trade of the company was decreasing because of overall decrease in sales.
Trade Debts
The trade debts of the company are decreasing over years. The major for this may be that cash payment is increasing for paying to the creditors. So the collection period is also decreasing.
The loans and advances of the company is decreasing due to decrease in sales.
The trade deposit and prepayments of the company are also decreasing.
Other Receivables
The receivables of the company are increasing because the company is giving credits to its customers in order to increase sales.
Taxation Payment
The taxation payment is decreasing which means hat the company is giving its taxes on time.
The cash and bank balance of the company was on increasing trend and it may be due to increased sales or company has recovered its receivables.
Share Capital
The share capital of the company was same in 2000 and in 2001 it means that the company do not has increase it over time.
Reserves
The reserves of the company was increased only 0.33% in 2000 0.36% in 2001this means that company has not increased its reserves. The main reason for a decrease in reserves may be no increase in share capital and sales etc.
Un-appropriated Profit
The liabilities of the company are decreasing, which means that the company is paying its debt on time.
DEFERRED LIABILITIES
The deferred Taxation was decreasing from, which indicates that payment had been done by company. The staff retirement benefits are increasing which means that company wants to motivate to its staff.
Current Liabilities
The current liabilities of he company are decreasing over the years. This may be due to decrease in Creditors, Dividends and Short term loan etc. but in the year 2001 it has increased due to the current maturity of redeemable capital. This is not a good sign for the company because the capital may be reduced.
Profit before taxation & after restructuring cost 1.47 82.9 (10.61)
Sales
The sales of company were decreasing in 1999 & 2001 it may be due to two factors
In 1999, the sales of the company decreased to 29.97% & it indicated that volume of the company was going down. In 2001 it has also decreased to 2.35 %.
The cost of goods sold was greater than sales of company in 1999 & 2001 it may be due to
Trading Profit
Change in the trading profit of the company was 11.12% in 1999 & 17.23 in 2000 & 4.84 in 2001. It may be due to the fluctuations in sales and cost of goods sold.
The selling & administration expenses were low in 1999 but it has decreased to 0.56% in 2000 which means that company has better control over cost & it was good for company. but in year 2001 these have slightly increased due to some unexpected expenses.
Operating Profit
The operating profit of the company is increasing over the year and it is a healthy sign for company that after meeting cost & selling expenses the company was earning more profit but in 2001, company s profit has reduced to a little but it was again good for the future prospects of company.
Other Income
The other income of the company was much decreased in 1999 due to decrease in sales etc. but in the following year company s income has increased to a greater extent that is a good sign for the company. Company can invest this amount in the business and can earn more profit.
Finance Expenses
Decreased in Borrowing
Auditors Remuneration
The auditor s remuneration was decreasing in 1999 because a decrease in operating assets and sales etc. but in 2000 & 2001 it started to increase again.
These were decreasing overtime. So it was not good for company. It was necessary for company to increase these funds to activate the employees. In 2000 company changed its policy and it has increased these funds by 82.7% and 0.84 %in year 2001 so more employees were satisfied in that year.
Profit before taxation was decreased in 1999 due to decreased in tax & due to change in tax rates. But it again increased in 2000 due to decrease in tax and in the year 2001 it has increased due to decrease in worker s participation funds.
Profit was decreasing due to restructuring cost but as there was no restructuring cost in 2000 the company s profit was increased but ion the year 2001 profit was decreased due to restructuring cost.
Taxation
Taxation was decreased to 2.14% in 1999 from 39.83% in 1998 & it may be due to tax advantages that the company have for his success. But it again increased in 2000 to 97.4% it means that company have to pay a large amount of tax & decreased in the year 2001 by 13.86%.
Profit after taxation decreased in the year 1999 & 2001 due to decreased in sale but it was good in the year 2000 due to high sales.
CONCLUSION
By analyzing the Financial Analysis of UNILEVER PAKISTAN LIMITED , I can conclude that although the sales of the company was decreasing in the year 1999 & 2001. but it did not mean that the financial position of the company is back or weak.
Decrease in Demand
Increase in Prices
So, I can say that in 1999 year due to decrease in sales, the cost of goods sold is also decreasing, which resulted in low trading profit. But in 2000 due to increase in sales and in the cost of goods sold there was increase in the trading profit.
At the same time, Administration & Selling expenses of the company was also decreasing, which indicated that the company had the effective control over the expenses. At the same time, due to decrease in profit, the taxation was also decreasing which indicated that company is paying its taxes regularly. The dividend of the company are increasing due to increase in cash and other current assets etc.
Hence, I can say that although some of the items of the Financial Statement are decreasing but the company is still earning the profit. Now company is reviving its position and has changed its short-term debts into long-term debts as in that case cost of funds is lower. The company is managing well its sales and receivables which reduced the possibility of bad debts.
The main reasons for a decrease in profit may be that company wants to shrink its business in Pakistan due to Economic and Political stability. The major problem that most of the companies had to face in 1998 was he greatest fluctuation in Prices due to Automatic Bloats .
So, it is necessary for our Govt. to provide the stability to our companies so that these companies can carry out its operations peacefully and all of these efforts will result in increased returns of the organizations.
Theoretically students learn from books in universities but Internship programme provides a good practical training opportunity to the students, which helps the students when they entered into their practical lives.
For the purpose of Internship Training, I choose world s one of the largest Manufacturing organization named as Unilever Pakistan Limited .This training programme at Unilever was very Interesting, learning and Challenging for me.
My Internship programme coordinator was Mr. Nazir Ahmad controller HPC. He took my interview first and then recommends me in accounts department due to my own interest and due to my commerce back ground. Then he sent me to Mr. Yaqoob Khan , a Assistant Manager of Accounts department, who designed a very interesting Internship Programme for me. He took my interview first, and then he gave me company profile so that I can understand the company structure, policies and roles of executives. Then he introduced me very warmly with the persons of Accounts department.
The main purpose of this training was to introduce me with all facts of Accounting process in practicality.
The detail of various departments where I worked or introduced during my Internship is given below.
Financial department
Costing department
Payment department
Cash office
Planning department
Buying department
Personal department
Administration department
Distribution
Material Store
The departments of the organization like marketing, production, planning, buying, and distribution work together to fulfill the demand and to procuring. The raw material that is required for production. Marketing department receive orders from the customers and necessary information which beneficial for the organization. From marketing this data go to planning department and planning department determine the total demand and required raw Material for the demand. Planning department is the center point of whole process.
Planning department says to buy to purchase raw material with considering the lead-time. Than buying department think about purchasing the raw material and contact with suppliers and choose certified suppliers and check the quality the raw material and purchase the raw material if it is satisfy with all specification.
Planning department also says to production department to produce required products at time, about categories and lot size which should fulfill the demand and time when products are required. Then production department get the required raw material from the buying department which have been already purchased that material .Now Production department start the work and manufacture all products as soon as required.
Planning department also says to distribution department to place the shipments and timing of that shipment. Then distribution gets the finished goods from the production and ship the products at mention places and get the receive approval from the Customer. In this way all process continues and works in the sequence.
Efficiency of the Organization depends upon all departments of the organization. Specifically planning, marketing, distribution, buying, accounts and production departments play more important role to increase the efficiency of the organization.
During my internship in Unilever Rahim Yar khan I worked in the Accounts department that include;
Financial Section
Costing Section
Payment section
Cash Office
FINANCIAL DEPARTMENT
Calculation of depreciation, Gross Book value (GBV) and Net Book Value (NBV)
Maintenance of medical expenses, Traveling expenses vouchers and their record up to management staff
To keep record about the details of debtors and creditors of the company
Preparation of various Debit and Credit notes, Journal Vouchers and their records
FIXED ASSETS
All items owned by a firm or company or individual like building, land, factory equipment, plant and machinery, furniture and fixture and other property are called fixed assets.
The financial section maintains all the items of balance sheet except equity section, (Equity section is maintained by the head office).
Unilever R.Y. Khan Factory has a good system of taking the assets into accounts. Assets, when acquired are recorded in the ledgers. At the end of each year these assets are capitalized and then GBV and NBV are calculated. These values are recorded on the cards which are called GBV cards.
DEPRECIATION
On The basis of above mentioned cards depreciation is charged according to their respective rates. The rates of depreciation applied by the Unilever R.F for the calculation of depreciation on fixed assets are given below:
DEPRECIATION DEPRECIATION
METHOD OF DEPRECIATION
Method, which is used by Unilever R.F. for calculating the amount of depreciation, is called Straight-line method.
Rs.
NBV XXXX
CAPITAL PROPOSAL
Capital proposal means those requisitions that are used by the previous departments in order to purchase some fixed assets.
Unilever R.F. has a project department whose function is only to make the decision about the needed fixed assets. The project department makes the proposals of purchase of fixed assets and sends to the Works Manager for approval. The record about the capital proposal and record of those assets, which will be that purchased on the acceptance of such proposal, is kept by the financial section of the organization.
PROCEDUR
Works manager is the approving authority of all the Capital Proposals which are send by the project department. Sometimes, the Capital Proposals are furnished directly by the concerned department which has the need of the assets. Some departments have been authorized to incur the capital expenditure to a certain extent
After approval, Capital Proposal reaches to the Project Department which prepares the purchase requisition and sends it to the Buying Department. The Buying Department makes arrangements for the purchase of particular capital item and then work on that Capital proposal begins.
After starting work on this approved Capital Proposal the Account Department watch that Capital Proposal is being done according to certain report which is prepared on monthly basis. The name of that report is Capital Expenditure Report . This report helps the Account Department to watch that how much the work has completed and how much is left. Work on certain Capital Proposal will be done on month wise and takes into capital expenditure control account as per trial balance.
If the work is not started on any Capital Proposal then a report is prepared for that Capital Proposal. When the project of any Capital Proposal is completed then a report for the completion of that Capital Proposal is also prepared.
Purchase Order
GRIR Accepted
In a year four Times capitalization procedure is completed. At The end of each quarter capitalization of Capital Proposal is done by the Capital Proposal Account Department. For various head of accounts, Company has mentioned various numbers of Capital Proposal just like as
91/L/101
92/L/301
93/L/306
94/L/308
Assets transferred advice is that memorandum which is used to transfer various assets from one location to another location. So we may say that it is inter Unit advice .
Four copies of ATA are prepared, of their authorization; one copy is send to Account Department and others to respective departments.
BOOKING AUTHORITY
It is the permission of journey. When any employee travels for company business or for personal matters then he or she has to take the permission from some person who has been authorized by the company to give the permission to such person for business purpose. Traveling facility is provided to Management and Non-Management staff (Junior Manager and above).
After this when certain person comes back, he sends a Traveling Expenditure Statement with his signature, to A.M. Accounts Department. Booking authority is affiliated of this traveling approval from authorized person.
For factory employees including all management and non-management, certain company s manufactured goods are sold to them on subsidy like as soaps, Ghee, Wheat, tea etc on concision rates. For this purpose Company has opened one shop in Lever Estate named POD or Estate Shop .
From POD shop daily Cash Sales Summary is received with cash memo to the Accounts Department. At the end of each month one JV is passed for this subsidy and charged to. This summary is prepared according to book month because it is internal transaction of the company.
LOCUM-TENSES AUTHORITIES
This is a memorandum, which means transfer of responsibilities to another responsible person. When one manager goes on leave then he sends a copy of locum tenses authority to accounts department that now this person is responsible for my job.
WORKING CAPITAL
To know the financial position of the business each month of the financial year working Capital report is prepared. With the help of Working Capital Report, company knows how much capital is circulated in business. And also know that how many accounts receivable, accounts payable and inventories exist.
Two copies of Working Capital report are prepared. One is sent to head office monthly basis while second is for office use.
To control the repair expenses of the factory Over Head Expenditure Report is prepared on monthly basis. All locations mentioned in workshop, for example Worker Administration Department, for their salary, traveling expense, building of the workshop administration department all revenue expenditures are Called overhead Expenditure report.
After obtaining this report one JV Is passed by Accounts Department according to various a/c # and locations.
This report is received from R.F. Engineering Department. It shows the detail of that work done on repair and maintenance, in other words those expenses which incurred on repairs and maintenance up to at the end of each month. This final report is send by Engineering Department to Accounts department. Against this report Accounts Department prepares two JVs; one for Capital Proposal Administration Department while second against various locations.
RECONCILIATION
Reconciliation functions are also performed in financial section. Following Reconciliation Statements are prepared in this department.
Reconciliation Statement between Wall s Ice cream and Rahim Yar Khan Factory
Reconciliation Statement between Karachi edible oil The & Ghee Factory
COSTING DEPARTMENT
This department provides very useful services to the company and is responsible for costing of the products. This department does the yield calculations of the followings:
Crude glycerin
Refined glycerin
Edibles
For the calculation of yield, these elements are taken into consideration:
Storage loss/gain
Bleaching loss/gain
Packing loss/gain
Un-accounted loss
STORAGE LOSS/GAIN
When oil and fats are received by the material store, sample is taken for measuring percentage of Free Fatty Acids (FFA) and moisture. All these materials are received by the stores and then issued to production department.
At the quarter end, cost department does the stock taking of all the tanks of oil and fats and also draws a sample for determining moisture. Now the cost department see that what is the difference between the physical n = and book stock. This deference will be the loss or gain and charged to the production account.
BLEACHING LOSS/GAIN
For the purpose of bleaching the Activated Earth is used. The Activated Earth absorbs some amount of tallow. This absorption is called bleaching loss. Cost department calculates this loss.
PACKING LOSS/GAIN
When the finished products are packed some packing loss or gain took place at this stage. Some products are packed above the standard weight and some less. Packing loss or gain is also determined.
UN-ACCOUNTED LOSS
Some losses are not seen in manufacturing process, these are called Un-accounted losses.
Cost department looks into the yield and performance of the factory with the help of various reports. These are following:
Production accounts
This report tells that how much raw material is transferred to plant, what is the weight of activated earth used, how much fats are spoon-fed, soap cleaned, lye transfer to glycerin section, lye treated and refined glycerin effected into drums. With the help of these informations, this department takes care of yield.
Cost department makes production accounts of all products with the help of followings:
Chemicals
Packing material
Value of material consumed is taken from consumption schedule and is charged to production accounts after making adjustment of opening and closing stock.
CHEMICALS
Cost of chemicals and taken from consumption schedule and prorated on products pack wise and in these cases whose closing stocks are chemical mixed value is charged to production accounts after adjustment in opening and closing stock.
PACKING MATERIAL
Packing material but is taken from consumption schedule and then total cost is charged to production accounts of the products.
VARIABLE MATERIAL
It is just as packing material but at present crude glycerin stock has accumulated hence we have to keep variable chemicals value equivalent to its weight in stocks.
Steam and power are taken from variable direct schedule in total against their location but same case with crude glycerin, which has been explained, in variable direct chemicals.
STEAM
Weekly steam production report is received and from these quarter reports are prepared. Meter reading of all steam main meter and sub-meter are done at quarter end. Cost of steam is calculated and transferred to all the production departments where steam is used. Cost of burners used in factory is subtracted from total Sui gas bill.
POWER
Meter reading of WAPDA main meter, and own generator and sub-meter in the factory are done at quarter end. Power is allocated on all factory location on the basis of sub-meter; the technical management gives the standard bases. The cost of power is changed to production accounts.
he reports of daily production are submitted by the production department to cost department. This report helps in watching what is the production of certain product on certain day, and how many transferred to warehouse and what is the present balance on department floor.
Cost department prepares daily, monthly and annual cost reports. The management for control purpose uses these reports whether the cost is according to the standards or not. The area of difference is pointed out and a better control is exerted for the future. It is also important because if a company is able to lower its production it works more than to increase the market share. It is easy for a company to lower its cost because it is in its own control while the market is beyond the control of management.
In Unilever the cost of sales is calculated in a very simple way according to the standards of accounting.
The report starts with the opening stock of Material, Steam/Power and Distribution. In these opening stocks the cost of oil and fats which comes from oil & fat consumption report, the chemical cost which is obtained form chemical consumption report, cost of packing material obtained of packing material consumption report, cost of steam/power obtained from steam/power consumption report, for that day production is added and it gives variable cost of production. From this variable cost of production the closing stocks of material, steam/power and distribution that day is deducted which gives total cost of sales.
PAYMENT DEPARTMENT
Different department of Unilever Rahim Yar Khan factory is working under Commercial Department. Payment Department is one of them. Payment Department is also called APV (Accounts Payable Vouchers). The purpose of this department is to make the arrangements for the payments of the factory liabilities.
APV 1
APV 2
APV1
FUNCTIONS OF APV 1
Local payment
Payment of medicine
Preparation and submission of weekly and monthly statements through advance tax system.
Repair of building
APV 2
APV 2 makes a payment of wages and salaries for the workers of Unilever Rahim Yar Khan Factory.
FUNCTIONS OF APV 2
Management
Non-Management Staff
Every department of production sends a location sheet to account department in which it mention that how many hours have been spent on each location. The APV 2 also receive information about the over time etc. on the bases of these information it prepares salaries sheet and submits to APV 1 for making cheques. APV 1 prepares cheque or salary sheet and sends to Muslim Commercial Bank Limited RYK. That bank is situated within the premises of Unilever R.F.
The MCB Rahim Yar Khan pays non-Management salaries and wages. MCB is rendering very useful services to the company and its employees.
For salaries of management, R.F. receives debit note from the head office because the head office pays salaries to the management. All management s salaries are transferred to manager s bank accounts. Wages of workers are paid on 3rd, and management on 21st of every month.
PROCEDURE OF PAYMENT
All payments have the similar procedure. When any department of the factory want to purchase any item for production, repair etc. then it sends requisition to the buying department. These items can be purchased from R.Y.K. as well as from other cities of the country and some items are also imported.
Those items, which are purchase from RYK, are called local purchases and the payments of such items are known as local payments . When goods are bought from outside R.Y.K. such purchases are known as outside purchases and payments of such purchases are called out side payments .
APV section makes the payment sheet at that time when it receives the following documents:
Purchase order
GRIR accepted
Purchase order is send by the buying department to APV. The requisitioned department (Who requests to buying department for the purchase of item) submits GRIR. Invoice is send by the supplier to the payment department. If the concerned department has accepted the GRIR then payment department will prepare the payment sheet/payment voucher.
Reference number
Bank name
Classification number
With the help of above information if amount is Rs.150 then payment is made on cash voucher. When this amount is more than Rs.150 then payment is made through cheque. When payment is made through cheque then requisition for cash office is generated through system with the help of payment sheet. The requisition is prepared by the computer automatically. The system also mentions the cheque # on the monitor that is also written down on the payment sheet. After that payment sheet is submitted to the cash office. The cash office prepares the cheque through computer. The cheque is send to authorized person for authorization of payment. After that if the payment is required to make through D.D/T.T then D.D/T.T is prepared. The cheque is posted or given by hand to the respective supplier. The suppliers get the amounts from the banks of Unilever. In this way the payment is made to the respective supplier
After making the payments to the concerned persons the cash office sends the payment sheet to APV. The payment department has various registers. One for local purchases, one for outside purchases, and one for engineering sores items and so on. All the information is transferred to respective registers.
In register there is company s name, company s code, address, phone # etc. if there is no name of a company then its name is written down In the register and then information are transferred to the register.
It is required by the law that every organization will deduct the advance tax from the amounts of the suppliers. This function is also performed by the payment department carefully.
After deducting advance taxes from various parties payments, these amounts are deposited in national Bank of Pakistan Limited RYK branch on weekly basis. Four copies of challan for Tax Payment Receipts are prepared through system. The details of these copies are gives below:
This certificate is evidence of the tax payments. At the end of the month a monthly tax payment report is also generated through system for reconciliation purposes and to know the real position that how mush amount has been deposited during this month.
At the end of a year Income Tax Deposited Report is prepared by the payment department and is sent to the head office Karachi.
When oil contract is received to APV section then with in four hours 95% payment is made in advance. In the same way when wheat contract is received to APV then 80% payment is made in advance.
Payments of medical bills of workers are also made by APB local payment section. For this purpose one medical bill after authorization from the doctor and IRD is received to this section after that petty cash voucher is passed for the payment such expense.
Allocation of various expenses like as insurance, custom duty, handling charges, bank
charges and miscellaneous charges relating engineering stores items, this duty is performed by APV department.
For the payment of the above expenses of junior managers the respective statements like medical expenses statement or traveling expenses or meal expenses statement for medical, traveling and meal expenses is prepared by certain person and send to APV department. If it is a medical expenses statement then it is compared with annexed approved bills and in case of traveling bills or meal allowance, approved booking authority compared with it, after checking this document is sent to W.M of R.F for further authorization. When this returned back to APV thin APV makes petty cash voucher for cash payments and journal vouchers for settlement of accounts.
After receiving the raw material or capital items mentioned in debit note APV gives a credit note to head office. At the end of each month it compared with its accounts with head office account. Account payable voucher section prepares debit and credit statement and furnished to head office Karachi for reconciliation for both accounts.
To meet the payment requirement APV department also prepares cash forecast statements according to the company s strategy on daily, weekly and monthly bases and such statements are submitted to the dead office.
Wages XXX
Bonus XXX
CASH OFFICE
Cash office is just like as commercial bank. The objectives of cash office are:
Maintain the cash book and then reconcile it with bank statement
BOOKS OF ACCOUNTS
Generally cash office prepares the following books of accounts for records purposes:
Cash book
Bank cards
The cash office receives the payment voucher or requisition slip with supporting documents from the APV (Accounts Payable Voucher) or payment department.
Cheque number
Amount of cheque
AUTHORIZATION OF CHEQUE
After preparing the cheque with computer cash office sends this requisition to the signing authority. The company has fixed a limit for responsible person for signing a cheque.
If the amount is less than Rs. 5000 then sign of Mr. Abdul Latif junior manager of payment department is sufficient.
If the amount is more than Rs. 5,000 but less than Rs 100,000 then the sign of one A.M is necessary. In these days Mr. Muhammad Yaqoob Khan A.M. of financial department and Mr. Tariq Yousuf A.M of costing department are signing all the cheques whose amounts are less the Rs. 100,000
If the amount is more that Rs.100, 000 then the sign of one authorized A.M and sign of one authorized Manager are necessary.
The cheque has two parts. One part remains with cash office for record and other parts delivered to the third party by hand or Bank D.D/T.T is prepared.
The cash office also prepares cash book at the end of every month and then reconcile it with bank statements. The cash office also makes the following payments:
Salaries to employees
Just like commercial bank, cash office provides loans and advance salary facility to the employees cash office also provides Accommodation cheque facility to all management staff. They can drawn the cheque on cash office and receive cash at the counter. So we can say that cash office works also as commercial band.
RECEIPT OF CASH
At the end of every day cash office prepares cash counting sheet which provide the following information:
After preparing the cash counting sheet and filed in a particular file and it is reconciled with band statement or cashbook.
BANKS
Now a days Unilever Pakistan Rahim Yar Khan Factory cash office deals with the following banks for business transactions:
PLANNING DEPARTMENT
Planning is intellectually demanding process. It requires that we consciously determine courses of action and based our decisions on purpose knowledge and considered estimates.
Before planning we set our goals and reach on a certain decision with the help of knowledge and estimates.
Planning in Unilever is being done in a systematic manner. Every activity is planned in such a way that it gives maximum results. Every organization has a planning department and without it a good business cannot be carried on. This department coordinates the manufacturing activities taking into consideration the other factors like sales, demand etc.
FUNCTIONS
Planning department in Rahim Yar Khan Factory is performing the following functions:
Production Plan
Material Management
Inventory Management
Production Reporting
PLANNING INPUTS
Sales Target
Capacities
I.T Support
Materials Availability
Production Capacities
Upcoming holidays
Naming Constraints
Safety Stock
PLANNING PROCESS
Planning process starts when sales estimates come from the Sales Department.
One is the annual sales estimates for the next twelve months.
Second is a latest sale estimate which is based on actual sales of six months and planned sales for next six months.
This data is put into the system to prepare the Master Production Schedule. This MPS is prepared every month for the next twelve months. The MPS is again feed into the system to get the Material Requirement Plan (MRP).
Following parameters are put into the system to get this MRP, on hand inventory, safety stock, safety time, lead-time and production quantity. This MRP is prepared monthly to generate the purchase requisites.
The MPS is also used to prepare the long term capacity planning and short time capacity planning. Shortterm plans are used to prepare the monthly capacity plans of time station. From these plans weekly plans are prepared
The annual production plans are used to prepare quarterly and monthly plans. From monthly production plans weekly production plans are prepared. In this plan manufacturing order status is prepared. This MOS states that how much quantity of product is planned and on what date it should be produced.
The monthly order status is multiplied to the usage sheet of product and a report analysis of weekly short falls for three months is generated on system. In this report it is stated that how much quantity of an ingredient is required for a certain product.
Planning department prepares a Manufacturing Stock Allocation with the help of computers. Here it is mentioned that against each order how much stock is available. The short falls are communicated to raw material buyer and packing buyer and they will arrange the supply of material
In accordance with the sales that come from weekly National Primary Sales Control final statement that is called weekly production plan is prepared. In fact this is the plan according to which production is controlled. These weekly plans are sent to the production department, who arranges for production according to this plan.
In order to see whether productions are according to plan or not, every department sent daily production reports to planning department which matches these figures with the plans.
Planning department is following the MRP concept. This concept is meant for the planning of all the things related with the production. These are:
Production Planning
Material Planning
Labor Planning
Supplier Planning
Machine Planning
PLANNING CONSTRAINT
Power Breakdown
Maintenance Shutdown
Variable Sales/Forecast
Capacity Constraints
Productivity Factors
Lead Time
BUYING DEPARTMENT
The word buying means purchase of any thing or any merchandise or item. This function is performed by buying department in any organization.
Buying or purchase is one of the major functions of any company of organization. Without it no one organization can run successfully in the field of business. So we may say that buying is the soul of company. Without buying all departments of the company will be failed.
The main objectives of any buying department is to purchase merchandise and services with the object of ensuring the specification, quality, price, time of payment and timing of supplies are consistent with the overall need and objectives of the business.
FUNCTIONS
Following functions are performed by the buying department of RahimYar Khan Factory.
To buy all production raw materials including all types of material and packing material.
To buy all engineering requesting items (all types of machinery & spare parts).
Purchaser of W.C.S.O. seasonally for Karachi & Rahim Yar Khan Factory.
The company has maintained a fine system of buying. In fact, buying department of R.Y. Khan Factory performs its functions on local basis. But imported raw material & packing material is bought by the central buying department of head office. The procedure of buying can be explained with the help of following charts:
Purchase requisition
Quotations calls
Purchase order
Goods receipt
GRIR is prepared
Store report
GRIR is accepted
Payment
PURCHASE REQUISTION
Any department which has a need of something sends purchase requisition regarding its requirement to buying department, who arranges for the purchase of required items as soon as possible. Three copies of purchase requisition are prepared. These copies distributed as follow:
First of all the buying department invite to general public and some particular parties for quotations. After receiving quotations summary of quotations is prepared and comparison is made with price quality etc. After that the party is decided on which an order is to be placed according to the terms & conditions. Then purchase order is prepared in the favor of succeeded party. All information regarding delivery and freight is mentioned in purchase order.
When goods are received from supplier then GRIR is prepared by material store department and sends to lab for inspection. If goods are accepted in the laboratory then these are placed in the concern store other wise not.
In case if the material is not accepted then a sundry sales (SSA) advice or sundry sales credit will be made to return the goods to the supplier.
PAYMENT
When GRIR is accepted then one copy of it is submitted to payment department, where the payment department prepares payment sheet and makes advice to the cash office for payment after satisfying the other formalities.
SUNDRY DISPOSAL
Another function that is performed by the buying department is to sell the factory surplus of various departments like, as capital items, furniture, and part of machinery and scrap items etc.
One memorandum is received for the disposal of sundry items from concerned departments, time to time, to buying department. The buying department takes action on that memorandum as soon as possible. Buying department calls quotations from some particular parties, whose names and addresses send by head office. After obtaining quotations a summary of quotations is prepared. Whose party s rate is highest, its quotations are accepted. After that a letter is issued to succeeded party about the acceptance of its quotations and instructed it to take delivery of the goods as soon as possible from the factory.
FRIEGHT PAYMENT
Often goods are received on trucks. The factory has to pay the freight charges to the carrier. For this purpose truck driver comes to the buying department for the receipt of freight charges with the following documents:
Truck bilty
After receiving above documents, an advice is prepared by the buying department which is called Freight payment advice . This advice is forwarded to APV department.
Two copies of freight payment advice are prepared and distributed as follows:
CSO PURCHASE
The firm has segmented structure of supply chain Management. The purchasing, production control and distribution departments have responsibility for material management.
SITARA CHEMICALS is the supplier of local raw material of soda ash, caustic soda etc. Supplier selection is based on price, quality and delivery.
SAFETY STOCK
LEAD TIME
13- 20 weeks
FORECASTING
DEMAND FORECASTING
A forecast is the prediction of future events used for the planning purposes .
FORECASTING TECHNIQUES
There the three forecasting techniques are available for the purpose of the forecasting of the demand, which are as under.
Judgment Method.
Causal Method.
The usage of these techniques depends upon the availability of the data about the past.
FORECASTING AT UNILEVER
The forecasting technique, which is being followed by UNILEVER, is the qualitative technique.
Sales force estimate of forecasts compiled by the members of the company s sales force (their dealers in each region) about the future demand of the product. They are using this technique because they believe that their estimates are correct since the dealers are much near to the market. Marketing Department is actually involved much in forecasting. They observe the trend of the market and they set their target of sale then they tell to the production that what is their target then production department make productions according to the target set by marketing department.
TIME SERIE
Demand for the future periods is also determined by the time series method. Historical data about the past demand is the basis for the time series. The data is used for the demand projection for the coming periods.
MARKETING RESEARCH
Marketing research is also conducted by the firm. Data obtained is used to determine the customer demand pattern, and trends.
CAPACITY
Capacity is the maximum rate of output for a facility. Capacity planning is central to the long-term success of an organization. The operations manager must provide the capacity to meet the current and future demand else the organization will miss opportunities for growth and profit. Capacity plans are made at two levels:
Short-term capacity plans focus on work force size, over time, budget, inventories and decisions.
PEAK CAPACITY
It is the maximum output that a process or facility can achieve under ideal conditions. Peak capacity can be sustained for only a short time, such as a few hours a day or a few days in a month. A firm reaches it by using extraordinary measures, such as excessive over time, extra shifts, temporarily reduced maintenance activities, over staffing and sub contracting.
EFFECTIVE CAPACITY
It is the maximum output that a process or firm can economically sustain under normal conditions. When operating close to peak capacity, a firm can make minimal profits or even lose money despite high sales levels.
Operations manager must examine the three dimensions of capacity before making capacity decisions:
The capacity cushion is the amount of reserve capacity that a firm maintains to handle sudden increases in demand or temporary loses of production capacity it measures the amount by which the average utilization falls below 100 percent.
Another issue of capacity strategy is when to expand and by how much there are two extreme strategies:
The Expansionist Strategy, which involves large infrequent jumps in capacity. In this strategy organization remains ahead-of-demand.
The Wait and See Strategy could be to follow the leader, expanding when others do.
Management may choose one of these two strategies or one of closely linked to strategies operate between these extremes. Capacity decision should be considered throughout the organization. When managers make decisions about location, resource flexibility and inventory, they must consider the impact on capacity cushions.
Capacity cushion buffer the organization against uncertainty as do resource flexibility, inventory and longer customer lead times. If a system is well balanced and a change is made in some other decision area, then the capacity cushion may need changes to compensate.
INVENTORY MANAGEMENT
There are different types of inventories from which Unilever use following types:
Cyclic inventory
Anticipation inventory.
CYCLIC INVENTORY
Cyclic inventory is used for both local and imported material. But only difference is in the length of cycle for both materials. Local material has small cycle than imported material.
Unilever used safety stock both for base material and for package material. But only difference in time for which safety stock is required. Safety stock inventory is used in following ways:
ANTICIPATION INVENTORY
Anticipation inventory is mostly used for imported & not for local material.
Unilever used standard design to place the inventory. Not used special design in the Soapery. Because soap fall in standard products not in customize products so standard design is better for placement.
ABC method
EOQ method
ABC METHOD
This method is used only for packaging material and for soda ash. This method is appropriate for the material which inexpensive.
EOQ METHOD
This method is used for expensive materials. Perfume and chemicals are managed by this method, because these types of materials are costly for over stocking.
HYBRID SYSTEM
This System is the combination of Q- and P- System but have some extra features to manage inventory. Some time Unilever used fixed quantity order or some time flexible quantities but fix time of period.
According to the Personnel Department of Unilever R.F., there are things which are common between workers and machinery of the organization. For examples:
There are many Departments which work for different areas. Such as Production Department works for the controlling of production. Sales Department works for the sale of Products. Finance Department arranges the finance for the organization and so on. Therefore there must be a department for the controlling, motivation and training of the employees. For this purpose Unilever R.F. has an Employees Relation Department. The Personnel Department of Unilever R.F. performs the following functions:
FUNCTIONS
Employment
Training
Compensation Administration
EMPLOYMENT
Personnel Department makes arrangements for the recruitments of the employees. For this purpose it collects information about the desired employee s functions and then defines the job requirements and job profile. The Personnel Department makes all the arrangements for the report meant of new employee, It sees better such employee is available in the organization or not. In case of no, it gives the
advertisement in the newspapers. It also collects all the applications of the applicants. It also makes arrangements for test. The Personnel Department uses different tests for different applicants. After that it arranges the interviews for the succeeded applicants. Usually the interviews are bland of different types of interviews. These interviews include panel interview, structured questions etc. The background information about the succeeded applicants is also gathered by the Personnel Department.
The Personnel Department transfers the workers from one department to other department according to the circumstances. The function of promotion of the workers is also performed by this department after consulting with the top management and analyzing the past record of the workers.
TRAINING
For smooth production and efficient work there must be some training programs for the workers, staff and management. Training function is also performed by the Personnel Department. It provides on the job training to the existing workers and arranges programs for new employees.
The Personnel Department provides the following training facilities to management, staff and workers.
Lectures
Seminars
Conferences
The company has a full time training manager who conducts the different training programs according to circumstances. The management is also sent abroad for certain training programs.
The Unilever Pakistan Limited conducts the wages survey in the market and of the major competitors after every two years and compares the results with its own package and there is any difference then adjustment is made. The desire of Unilever R.F. is that its employees must be satisfied in every aspect because it has the opinion that satisfied employees are more productive as compared to dissatisfied. The Unilever gives 30 different types of allowances to its employees. Some of these are annual, some are semi-annual, and some are monthly while some are once in the whole employment period.
Unilever R.F. is much conscious about the health and safety. Proper equipments are available in all areas of the production where sensitive machinery is in operation. Furthermore, the organization has a well equipped Medical Center where MBBS doctors are available in order to meet with emergency cases.
The Personnel Department provides all possible instruments to all workers and it has the desire that every worker should use those instruments in order to avoid losses.
Long shoes
Helmets
Gloves
Fire Instruments
Unilever R.F. also provides certain benefits and services to all its employees. A list of some benefits and services is given below:
Attendance Allowance
Death Compensation
Canteen allowance
Tea Expenses
Conveyance Allowance
Utilities allowance
Meal Allowance
Rehabilitation Allowance
Retirement
Jersey
Shoes
Tonga Allowance
Traveling Announce
Hajj
The organization has a club for the employees of the organization. Indoor and outdoor facilities are also available. The company also celebrates Annual Sports Day on which different games are played and prizes are given to the succeeded players by the company.
The most important function performed by the department is the Human Resource Planning. For a smooth production there must be an effective Human Resource Planning. For This purpose it makes long term and short term plans to make the labor available for production. Short term Plans are made for those places where workers have gone on holidays or absent.
Badli
Temporary
For long term plans workers are recruited from the temporary workers who have become skilled one.
MOTIVATION
The organization has the opinion that motivated workers are more productive than unmotivated workers. To motivate its employees the organization uses both intrinsic and extrinsic approaches for motivation its employees.
o Intrinsic Approach
o Extrinsic Approach
INTRINSIC APPROACH
Job rotation
XTRINSICE APPROACH
Training
Appreciation letters
Bonuses
Cash awards
Gifts
Shields
Clocks
Put the name of the workers on the notice board who perform an excellent performance. To motivate the employees the organization has introduced a program name OFI (Opportunity for Improvement).
ADMINISTRAITION DEPARTMETNT
Unilever Pakistan Rahim Yar Khan Factory has also an administration department that is controlled by the personal department.
Usually the management staff has to go to Head Office Karachi for business matters then they need transport. This arrangement is made by the administration department. The company has its own transport for drooping and leaning of management staff at the AirPort, or Railway Station.
ARRANGEMENT OF JOURNEY
When a Manager, Assistant Manager or any Junior Manager wants to go outside the city either for personal or business purpose, they inform to the administration department about their intention. They instruct to the department for making the arrangements of journey
An arrangement of journey includes reservation of seat in train or in airplane as the case may be. After making such arrangements the administration department informs to the concerned person about the reservation and other information.
Stationery includes pen, paper, pencils, rubber, sharpener, etc. all these items are purchased by the administration department. It sends the purchase requisition to the buying department for the purchase of desired items.
The administration department also prints all these documents, vouchers invoices sheets etc. which are used by various department of the company.
ISSUE OF STATIONERY
All stationery is issued by the administration department to various departments of the company. It also maintains the record of such stationery. Administration department prepares reports about the issuance of stationery on monthly basis.
ENTERTAINMENT FACILITY
Tea is provided to all management during working hours in order to keep the staff fresh and to improve their efficiency. All arrangements for entertainment are performed administration department. Arrangements for entertainment includes purchase of milk, sugar tea etc.
The administration department receives mail and distributes it to the relevant person. In the same way it dispatches all the mail of the company. Mail is made through OCS, TCS, or postal method.
DISTRIBUTION
Now a day s business is extended to a great extent. Markets are widening briskly, so there is a great need to meet the requirements of this large market successfully. There should be such a system of distribution that the supply of products to the markets should be according to the needs; this system should be sales loss proof .
Unilever has a system, which gives maximum results. Supply of product is monitored in such a way that there are minimum chances of shortage in supply.
FUNCTIONS
Receives monthly or weekly Plans for distribution from Marketing & Sales Department HO.
To pay Excise Duty and arrange Provision for Excise Duty according to legal Requirements.
To pay Sales Tax liability at the end each month up to 20th day of next month.
DISTRIBUTION PROCEDURE
First of all production is transferred to distribution warehouse by the production department. Distribution department has two warehouses, which are capacity wise 700+150 tons (for soap and personal products) and 500+200 tons (for cooking oil. Distribution department arranges the dispatch plan that is provided by the consumer services head office. Therefore products are dispatched according to the dispatch plan.
Company has various sales depots located in different cities throughout the country. Such as:
Faisalabad
Karachi
Wazirabad
Lahore
Multan
Distribution department sends products directly to distributors or to sales depots as per instruction of sales department head office. Sales department makes sales contracts with different parties and supply by advising distribution in Rahim Yar Khan Factory.
All sales depots are controlled by head office. Sales department send plans for despatch to these depots which take necessary action according to plan.
Rahim Yar Khan South depot covers the area of Baluchistan and Sind while Central covers the area of Punjab and NWFP. There is another depot named over flow depot in Rahim Yar Khan. When there is shortage of space in factory warehouse, production is transferred to this depot.
Distribution department Rahim Yar Khan Factory sends despatch plans to over flow depots. This depot arranges the supply accordingly. For all the despatches a despatch advice is prepared in which the full detail of the products are maintained. Five copies of despatch advice are prepared.
DISTRIBUTION CHANNELS
Unilever has a centralized distribution system in which the products are distributed from one warehouse to the selected distributor of the company, and then the distributor make the product available to the wholesalers and at the end the product is transformed to the retailers to be purchased by the final customer.
The company had direct relations only with the distributors for making the product available to the target market. It deals with the distributors on net and advance payment bases and does not give any credit facility to them. However the company provides different commissions incentives. There are many certified distributors of Unilever operating in almost all major areas of the country.
Manufacturer
Company warehouse
Distributor
Wholesaler
Retailer
Customer
MATERIAL STORE
Receipt of Material
Issue of Material
The process of receiving these materials is different from each other. We will discuss these processes one by one.
Step 1:
WEIGH BRIDGE
First step in material receipt system is Weigh Bridge where vehicles reach. Capacity of Weigh Bridge is 80 tons. There are two operators on the weigh bridge.
Truck or other type of vehicle driver comes on Weigh Bridge and gives truck invoice to weigh bridge operator which is issue by the supplier of material. The weigh bridge operator check the type of material load on truck and note the truck number and its timing of arrival. If material is packing and raw then it is sent to material store for unloading. If material is Oil and Fat tankers are sent to sampling point. Lab assistant takes sample from tanker. Operator of weigh bride makes a sample chit and then this chit is sent with sample of material to lab for inspection. The operator is informed by telephone from lab that sample is ok. Then operator on weigh bridge take the first weight of loaded tanker and feed data in system with the help of software Weighbridge which includes serial number, supplier name, truck number, material name, sample no and first weight. Print of this data is attached to truck invoice. Then operator makes a weigh bridge slip and give it to driver and send driver to unloading point. One portion of weigh bridge slip is filled by the operator on Weigh Bridge and other part is filled by the operator on receipt on material.
After unloading tankers come back to weigh bridge. Driver gives back the Weighbridge slip to operator and unloaded tankers are weighted. The operator feed this weight in Weighbridge software and calculates net weight. Then print of data is attached to truck invoice. Operator checks the difference between net weight and weight written on truck invoice. If it is minor difference than it is ignored. If it is
major difference than it is mentioned on truck goods receipt which operator makes after second weight. Two copies of TGR are given to driver and two for office.
Operator feed this data is daily sheet, which is made in excel. After it, the operator feed this data in MFG Pro.
Step 2:
Oil and Fat, DFA and Liquid Caustic are unloaded on different point and process of unloading is different.
The point where oil and Fat is unloaded is call Tallow Decanting area. Following materials are unloaded at this point.
Tallow 1.5
Tallow 0.5
Coronal Oil
If material loaded on tanker is coronal oil and cottonseed Oil than the oil is shifted to storage tank through pipeline and with help of pump. But before shifting oil the operator on unloading clear the line with help of steam.
ST 65 and ST 12 is use to store tallow 0.5 which is use in Lux. ST 13 and ST 10 is use to store tallow 1.5 which is use for life buoy. ST 64 is use to store PK Oil.
The capacity of ST 64,12,13,65 is 400 tons and capacity of ST10 is 500 tons. Temperature of storage tanks is maintained with help of hot water running in pipelines inside the tanks. A meter gage shows the level of material store in tanks.
Tallow comes in two types of tankers. One is private company s tanker and others are Unilever tankers. The process of unloading these tanks is different with each other.
Five tankers of 25 tons each can be unloaded at a time. Truck driver brings truck to tallow decanting area and give weigh bridge slip to operator on unloading. Operator note the time when unloading start.
If tallow is in freeze condition in tanker than with the help of steam operator melt the tallow and then unload tallow in drop tank. From drop tank tallow is shift to Decanters. Tallow area contains two decanters having capacity of 200 tons each. Temperature of these decanters is maintained according to material. This material is than shifted to storage tank from decanters. Before shifting material to storage tank the operator on receipt clear the pipe line to storage tank with help of steam and when line clear than material is shifted with help of pipe line. After unloading operator note time and fill the weigh bridge slip and give it back to driver.
Company has its own tankers, which are called Big Belly. These tankers have facility to maintain the temperature of material. Material loaded in big belly is directly stored in storage tank with the help of pump. But before unloading pipeline is clear with the help of steam.
DFA:
Truck loading DFA reach at unloading point. DFA is unloaded and store in storage tank directly from tanker with the help of pipeline and pump.
LIQUID CAUSTIC:
Truck loading caustic reach at unloading point. Driver gives weigh bridge slip to operator. Caustic is first unloaded in drop tanks and from drop tanks caustic is shift to storage tank with help of pump. Two drop tanks are use to unload the tankers. Capacity of these two drop tanks is 25 tons each. Two storage tanks ST 66 and ST 25 is use to store the caustic. Capacity of these tanks is 150 tons each. After unloading operator fill the weigh bridge slip and give it back to driver.
Packing and raw material is unloaded in two hangers. One is hanger no 2 where personal product packing and soapry chemicals. Other is hanger no 3 where packing soapry and raw material is stored. Truck loading packing and raw material first reach to weigh bridge where operator on weigh bridge not the truck number and time of arrival and send it to hangers for unloading.
Operator on receipt of packing and raw material check the truck invoice which contain name of material, type of material, purchase order number, and quantity. Operator unloads the truck and keep
material to their specific place. During unloading operator also take sample of material which is sent to lab for inspection. Operator checks the material, count it and match the quantity received with quantity written on truck invoice. After unloading material truck good receipt is prepared which contain supplier name, quantity received packing, and description of product and discrepancy. Tow copies of this receipt is given to driver and two copies are keep in office. After TGR is issued the data is posted in Ledger. With the help on entries in ledger than data is feed in MFG Pro.
Issue process of oil and fat, DFA, liquid Caustic, packing and raw material is different with each other.
Storage tanks are kept full. Operator notes the level of material store in storage tank with the help of meter gage. Then he shifts oil and fat from storage tanks to pan room tanks. During issue he takes sample of material and makes a sample slip and send sample with sample slip to lab. After issuing operator note the level of tank. Then quantity of issue is calculated by subtracting last level noted from current level note. Then operator fills the issue sheet and makes two copies of it. One is given to operator of PAN room who is present there. Other copies is sent to office where related officer with the help of this sheet feed data in MFG Pro and makes a quality order and send it to lab.
Operator notes the level of DFA storage tank. DFA is directly issue to PAN room from storage tank. After issuing operator check the level of storage tank and notes the difference on issue sheet. One copy of
issue sheet is given to PAN room operator and other copy is send to office. Next day pan room sends an issue note to office and related officer feed data in MFG Pro.
Operator notes the level of storage tank. Level of tank is measured with help of measuring tape. After issuing operator check the level of storage tank and notes the difference on issue sheet. One copy is issue sheet is given to operator of PAN room and other is send to office. Next day PAN room sends an issue note to office where related officer feed data in MFG Pro.
Issue of packing and raw material handle three operators. One operator issues packing material to personal product department. Second issues packing material to soapry and raw material to NSD. Third operator issues chemicals to soapry and personal product department, perfumes and colors.
Issue note is sends to material store one day before issue from manufacturing departments. Related officer in store notes the name of material and quantity of issue on notebook of related operator.
Next day operator note the quantity of issue on lot card from where he is issuing and notes this lot number in his notebook. With the help of fork lifter material is send to manufacturing departments. After issuing material operator notes this lot number in issue note. Related officer post this data in MFG Pro.
ISSUE OF MATERIAL
Issued material can be return to material store from manufacturing departments because of two reasons.
If goods are returned on first base than manufacturing department send a return note with material to store. This material is stored near the lot from where it was issued. A new lot number is posted on this material. Related officer post return note in system. This material will issue first on requirement.
If goods are return on second basis than first a lab assistant checks the material. If material is rejected than it is stored separate place specific for rejected material.
A card, which contains lot number from where it was issued and number of issue note against which it was issued is posted on this material. Related officer sends e-mail to Supplier Company. The Supplier Company inspects the material and if it is rejected than it send fresh material to company.
SWOT Analysis
Strengths
Some of its brands have become the generic name for those products as Dalda in ghee & surf in detergents
Highly sales brands in skin care i.e. Ponds and Fair & Lovely
Weakness
Opportunities
Threats
Unilever is facing a very tough competition in personal care and detergents by P&G
High inflation rate is increasing the cost of imported raw material day by day