Unilever 2013 Annual Report Download - page 24

Partnershps are crucal to meetng
ourUnlever Sustanable Lvng Plan
(USLP) ambtons to source 100% of our
raw materals sustanably ths year, 48%
ofouragrcultural raw materals were
sustanably sourced, compared to 36% n
2012 In November 2013 we announced our
commtment to buy all our palm ol from
known traceable sources by the end of
2014, an mportant step towards our
commtment to securng 100% sustanably
from certfed, traceable sources by 2020
INNOVATIN TOETHER
Partnershps are also essental to
developng outstandng nnovatons
many of our great deas are developed
wth our supplers We are also fndng
new ways of nnovatng wth other
external partners – for example, through
‘nnovaton eco-systems’, whch brng
together our R&D experts wth academcs,
small and medum szed enterprses
(SMEs), and start-up companes We have
establshed a ‘scence grd’ of the world’s
leadng academc nsttutons, and we are
establshng a presence n a select number
of ‘hotspots’ of scence technology and
enterprse where we prevously had no
R&D nfrastructure
ROWIN SUSTAINABLY
WITH USTOMERS
We work closely wth our retal customers,
who are long-standng partners n our
effort to ensure that consumers get the
best choce, qualty and servce Ths year
we added fve locatons to our exstng
network of collaboraton centres, where
we develop joint integrated strategies for
merchandising without having to run
in-store pilots. We run joint sustainability
programmes with key customers including
Walmart, with whom we run the health-
and environment-focused Living Project,
and Tesco, through ‘A better future begins
at home’. In markets where reaching
consumers is still about the local small
shop, we use analytics to help us pinpoint
where we will expand our coverage and
GPS technology to track the stores that
we add. In India, for example, we have
added more than 2 million outlets in the
last four years.
The entire value chain from suppliers to
our customers are all important allies in
the ‘war on waste’. In our supply chain
alone, we have avoided cumulative costs
of€200 million for raw and packaging
materials and disposed waste combined,
and more than €150 million in energy
costs since 2008.
HARNESSIN THE BENEFITS
OF SALE
Through supply chain efficiencies we
created savings of €1.5 billion and released
€0.2billion of working capital in 2013.
We manage our factory network globally,
which allows us to export around the world
with consistent quality and competitive
costs. For example, our Knorr factory
in Sanguinetto, Italy, produces 72%
of global jelly bouillon and is currently
the cost benchmark for all our plants.
Hunting for efficiencies also makes our
business more sustainable. For example,
despite underlying volume growth of 2.5%
in 2013, our logistics operation reduced
total vehicle kilometres by 47 million,
compared to 2012. This was achieved
by implementing smarter distribution
networks and driving up vehicle load fill.
This led to an overall reduction of O2 by
more than 70,000 tonnes
RESPONDIN TO LOAL ONTEXTS
We combne our global scale wth the aglty
to respond to local needs Our low-cost
busness models (LBMs) deploy teams to
local markets to dentfy opportuntes to
enhance margns LBMs have so far
helped realse more than 200 mllon n
cost savngs from our Refreshment and
Home are categores and we are now
expandng the LBM programme to
Foods and Personal are
OVERVIEW OF RISKS
USTOMER RELATIONSHIPS
Successful customer relatonshps
are vtal to our busness and
contnued growth
SUPPLY HAIN
Our busness depends on purchasng
materals, effcent manufacturng
and the tmely dstrbuton of products
to our customers
SAFE AND HIH QUALITY PRODUTS
The qualty and safety of our products
are of paramount mportance for our
brands and our reputaton
SYSTEMS AND INFORMATION
Unlever’s operatons are ncreasngly
dependent on IT systems and the
management of nformaton
BUSINESS TRANSFORMATION
Successful executon of busness
transformaton proects s key to
delverng ther ntended busness
benefts and avodng dsrupton to
other busness actvtes
EXTERNAL EONOMI
AND POLITIAL RISKS
AND NATURAL DISASTERS
Unlever operates across the globe
and s exposed to a range of external
economc and poltcal rsks and
natural dsasters that may affect
the executon of our strategy or
the runnng of our operatons
TREASURY AND PENSIONS
Unlever s exposed to a varety
of external fnancal rsks n relaton
to Treasury and Pensons
LEAL AND REULATORY
omplance wth laws and
regulatons s an essental part
of Unlever’s busness operatons
See Rsks on page 34
THE REEN EXPRESS
The Green Express train transports Algida ice creams
700km from the factory at Caivano, near Naples, Italy,
tothe logistics hub in Parma, taking 1,411 trucks off
the road in 2013. This equates to an annual saving of
678 tonnes of CO2 in 2013 – without impacting our costs.
21Strategc reportUnlever Annual Report and Accounts 2013