Unilever 2009 Annual Report Download - page 30

Unilever Annual Report and Accounts 2009 27
The global category team aims to develop winning category and
brand strategies, to create exciting new brand communication,
product innovation and renovation, and to provide strategic
direction for the supply chain. The category team is responsible for
medium-term value creation, considering items such as market
share, category growth, brand health and innovation.
Our functional teams, notably Finance and Human Resources, are
responsible for providing business partnering, strategic support
and competitive services across the global business. Such functions
are organised around these same principles of business partners,
shared services and centres of expertise.
The top management team, called the Unilever Executive (UEx),
consists of the CEO with eight direct reports, including regional
Presidents for Western Europe, the Americas and Asia Africa CEE,
one global President for the categories, and four functional heads,
namely the CFO, Chief HR Officer, Chief R&D Officer and Chief
Supply Chain Officer.
Operating environment
In our markets, we compete with a diverse set of competitors.
Some of these operate on an international scale like ourselves,
while others have a more regional or local focus.
We aim to focus on providing consumers with added-value
products that will help them to feel good, look good and get more
out of life, in several important ways:
• creating and nurturing attractive brands that are trusted and
preferred by consumers and which seek to address consumer
needs and aspirations better than other brands;
• developing and rolling out new and better products and
concepts across our regions and product categories, supported
by innovative communication campaigns; and
• optimising and improving the productivity and efficiency of our
cost and asset base whilst ensuring consistent high quality of
our products.
Around 70% of our turnover is in countries and categories where
we have a leadership position, as measured by the value of
turnover. We hold the global number 1 position in savoury,
spreads, dressings, tea, ice cream, deodorants and mass skin care.
We hold the global number 2 position in laundry detergents and
daily hair care. We have strong local positions in household care
and oral care.
Unilever’s products are generally sold through our own sales force
as well as through independent brokers, agents and distributors to
chain, wholesale, co-operative and independent grocery accounts,
food service distributors and institutions. Products are physically
distributed through a network of distribution centres, satellite
warehouses, company-operated and public storage facilities,
depots and other facilities.
Our products are sold in over 170 countries around the world. In
many countries we manufacture the products that we sell, while
we also export products to countries where we do not have
manufacturing operations. The manufacturing network is
generally determined by an optimised regional sourcing strategy
which takes account of requirements for innovation, quality,
service, cost and flexibility. Certain of our businesses, such as
ice cream, are subject to significant seasonal fluctuations in sales.
However, Unilever operates globally in many different markets and
product categories, and no individual element of seasonality is
likely to be material to the results of the Group as a whole.
Our products use a wide variety of raw and packaging materials
which we source internationally, and which may be subject to
price volatility. For example in 2008 we saw unprecedented price
increases in many of our materials, notably in edible oils, which are
used in many food products as well as some personal care
products, and of crude oil, which is relevant to our transport costs
but also used as an input for certain petrochemicals and
packaging materials.
Transactions with related parties are conducted in accordance with
agreed transfer pricing policies and include sales to joint ventures
and associates. Other than those disclosed in this report, there
were no related party transactions that were material to the Group
or to the related parties concerned that are required to be
reported in 2009 or the two preceding years.
For more information about related party transactions please refer
also to note 30 on page 128.
Resources
Our brands
We have a strong and well-differentiated portfolio of global and
local brands, which are positioned to meet the needs and
aspirations of our consumers across a variety of price points,
segments and channels, allowing us to compete effectively in our
key categories and countries.
In 2009 eleven of our brands had global turnover of €1 billion or
more. These were Knorr, Hellmann’s, Lipton, Becel/Flora (Healthy
Heart), Rama/Blue Band (Family Goodness), Wall’s/Algida
(Heartbrand), Omo, Dove, Lux, Rexona (including Sure and
Degree) and Axe/Lynx.
We manage our brands under the following four category
headings: savoury, dressings and spreads; ice cream and
beverages; personal care; and home care.
Savoury, dressings and spreads includes soups, bouillons, sauces,
snacks, mayonnaise, salad dressings, margarines, spreads and
cooking products such as liquid margarines, and some frozen
foods. Our key brands here are Knorr, Hellmann’s, Becel/Flora
(Healthy Heart), Rama/Blue Band (Family Goodness), Calvé,
Wish-Bone, Amora, Ragú and Bertolli.