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Unilever

Procurement & Sourcing Strategy

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Group Members
• Syed Hasan Naqvi

• Umais Qureshi

• Shad Ashraf Ali

• Khizer Mukarram

• Muzammil

• Faizan
Unilever

“Unilever is a brand which is trusted


everywhere that focus on productivity and
performance. Unilever encourage our
customer, our people to develop new ideas.”
OUR MISSION

Unilever, we have ambitious plans to grow our


business while reducing our overall environmental
impact, and only through partnering with our
suppliers will sustainable and profitable growth be
achievable.
OUR VALUES
Fewer than four key values underpin the way in which Unilever is
doing their business

 Respect
It guides to treat the people with honesty, fairness and Dignity

 Integrity
It guides to do the right thing for the long term success of Unilever

 Pioneering
It gives the passion for winning and for creating a better future

 Responsibility
It is all about taking care of our customers and the employees
of Unilever
UNILEVER’S PORTFOLIO OF
CATEGORIES
UNILEVER GLOBAL
STRUCTURE

• Europe
• North Asia (Greater China & North East Asia)
• SEAA (South East Asia and Australasia)
• South Asia
• NAMET & RUB (North Africa, Middle East, Turkey and Russia)
• Africa (Central Africa & South Africa)
• North America
North America Europe
• Latin America

Africa (Central North Asia


Africa & South (Greater China
Africa) & North East
Asia)

NAMET & SEAA (South


RUB (North East Asia and
Africa, Middle Australasia)
East, Turkey
and Russia)
South Asia

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Procurement Application Tools
The Applications below are essential to any Unilever Procurement
Professional.

Material Price Forecasting (SAP BPC)

Improved harmonized tool for setting Standard Prices and calculating Price Trends

SAP (Material Management)

Process direct procurement

ARIBA BUYER

Process Indirect Procurement expenditures request and Process IP invoices here

ISIS

Use this tool to manage your savings projects and report savings results.

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Conflicting challenges between
Procurement and Planning
Purchasing wants

 Stable volume requirements


 Flexible delivery time
 Little variation in mix
 Large quantities

Manufacturing wants

 High quality
 High productivity
 Low production cost

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Challenges of Procurement Team

 Managing spend creep and ensure the cost control


 Managing the lead time
 The visibility of the saving (ISIS) is one of the challenge face by
Unilever
 Compliance of contract
 Maintaining the On time is full (OTIF) or Customer cases fill on time
(CCFOT).
 Effective use of sourcing
 Quality applied

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UNILEVER PROCUREMENT
FUNCTION

Unilever consist of two categories of procurement:

• Direct Procurement (Raw Materials / Packaging


materials)

• Indirect Procurement (Non Productive Items)

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OBJECTIVE OF THE PROCUREMENT
FUNCTION
• To evaluate the supply market and their trends i.e.
forecasting

• To ensure that the material will be available as per


desired timeline.

• To ensure that the product is as per required quality

• To ensure that violation of specs is not stated.

• To ensure that the material be delivered at right place


and with right quantity.

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SELECT SUPPLIER
DEVELOP TARGET EVALUATE NEGOTIATION &
GO-TO-MARKET
APPROACH SUPPLIERS RESPONSES AWARD

• Existing •NoteInclude all an


that whilst
• Prepare negotiation
• • Capabilities
Capabilitie
RFPinformation
is most
• Evaluation
• s
Time suppliers criteria will strategy:
common, choose
suppliers the
need
• • Quality
Time • Past method that matches include (may • Review all items
• • Service
Quality suppliers to present their that will have an
the needs of
best case, the be
• • Cost
Service • Market organisation influence on the
• • Reliability
Cost research including: weighted): outcome
• Include all
• • Capacity
Reliability • Supply • Confidentiality • Service • Agree negotiation
information
• • Ethical
Capacity market req’s • Capability team & assigned
suppliers need
knowledge • Timeframe roles
• • Culture
Ethical to present their • Quality
• • Order process •
Culture Different • Evaluation • Prepare negotiation
best case,
criteria • Lead time
• • Suitability
Order supply including: • Cost strategy
• Responsible
process markets • Specifications • Once supplier(s)
• Confidentiality • Score &
• sourcing (USQS •
Suitability Consider • Performance have been chosen,
req’s
• / Positive
Responsib substitutes req’s select short final contracts can
• Timeframe
le
assurance) • Determine • Historical list of be prepared.
• Evaluation
sourcing to
• Observance whether volumes suppliers for Suppliers should
criteria
pre- • Pricing details have signed up to
• ULObservan
supplier • Specifications negotiations
ce to UL
code screened • Financial the UL terms &
• Performance
statements • Invite short-
supplier suppliers req’s listed conditions, or at the
code can meet • Historical least highlighted
all the
suppliers for areas of concern
volumes
criteria negotiations
• Pricing details
• Financial
statements
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USQS – ARAVO – WHAT DOES IT BRING?
For Procurement

• Ability to identify approved suppliers for the products and services we want to
buy.

• Understanding of potential risk of buying products or services in all


geographies.

• Knowing that we have chosen the best as our partners.

For Your Suppliers

• Joining the system enables suppliers to qualify to work with Unilever and
gives visibility throughout Unilever’s global businesses.
PROCUREMENT PROCEDURE

• Purchase Requisitions
• Request for PFIs or Quotations
• Purchase Order
• LC or Bank Contract
• Follow-up for Shipment details and Docs
• Status of Arrival and Clearance
• GR/IR is prepared
• Payments

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ARIBA SPEND MANAGEMENT
Ariba Spend Management is a group of integrated web based
modules which is used to manage spend within the business.
In Unilever, we use the following modules:-

• Ariba Source – used to manage electronic RFQ / RFI with our


suppliers.

• Ariba Contract – used to approve and store all our IP contracts. Also
used to upload supplier catalogues (agreed price lists)

• Ariba Buyer – used to manage requisitions, orders and goods


receipts

• Ariba Network – a Business to Business (B2B) connector which


allows Unilever to send or receive electronic documents (i.e. orders,
order confirmations, invoices, invoice status, etc..) with our suppliers.
ARIBA BUYER
BENEFITS
• Single global instance which is available
to any Unilever employee with access to • Automated flows ensure audit
the Unilever Network. controls are in place and can be
approved via email (including mobile
devices connected to Unilever’s mail
• Simple and intuitive screens allow the system.
end users to raise requisitions with
minimal training.
• Reporting on spend categories
allows procurement to identify new
• Costing saving opportunities can be savings opportunities.
increased and maverick spending
reduced as demand is routed via the
procurement teams. • Audit controls are build in to reduce
the possibility of fraud.

• Preloaded catalogues allow the user to


browser and select items from preferred
suppliers and at negotiated prices.

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PARTNER TO WIN

Our Partner to Win Programme touches every aspect of


our strategy and creates a supplier ‘halo’ enabling all our
suppliers to aspire to the highest standards and to learn
and implement great strategies from our top-tier supply
partners.

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UNILEVER RESPONSIBLE SOURCING
STRATEGY
The principles of the Unilever Responsible Sourcing policy
procurement managers will be able to assess a
supplier’s compliance with Unilever’s Supplier Code in the areas of:
• Labour standards

• Health and safety,

• Environmental management practices

• Business integrity

• and determine the potential level of reputational


risk that the supplier may pose to brands, business and corporate
reputation.

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SERVICE MEASURES
We use a number of key performance indicators to measure our
Service and progress in becoming the Best Supply Chain in the industry.

 Dispatch Rate (DR) – is a percentage of cases DISPATCHED out of what


customer expects to receive
 Customer Case Fill (CCF) – is a percentage of cases ACCEPTED by the
customer
 On Time (OT) – shows cases delivered by Unilever at CUSTOMER
EXPECTED TIME
 Customer Case Fill on Time (CCFOT) - is the percentage of cases
ACCEPTED by the customer ON TIME out of the total number of cases
expected by the customer
 Service Efficiency (SE) – is percentage of PERFECT ORDERS (orders with
no date or quantity change ) out of total number of orders

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CONCLUSION

The overall report shows the work proficiency of Unilever


that how smoothly and specially the supply chain
management which is performing its activities more
efficiently and effectively.

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THANK YOU

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