Working with our customers

Our network of retail customers

Our products reach shoppers through a network of customers, from multinational retailers, wholesalers and distributors to small independent shops.

International retail customers such as Walmart, Tesco, Carrefour and Metro predominate in the US and Europe but also have a growing presence in developing markets too. Unilever combines global scale with local market knowledge, so we can help our customers achieve their own growth ambitions as they extend their operations into new geographic areas. 

While around a fifth of our worldwide sales are channelled through ten major retail chains, we also sell products through a more diverse group of distributors, wholesalers and millions of small independent outlets and kiosks, particularly in developing and emerging countries. We refer to these small shops as our ‘distributive trade’. The developing markets accounted for 53% of our sales in 2010 so distributive trade continues to be an important driver of our growth.

Meeting the needs of different types of retail channels requires us to take a flexible approach and to be responsive to different customer strategies. Our goal is to ensure that Unilever is the partner of choice for our smaller as well as our large international customers. With our expertise, wide-ranging portfolio of products and international network of businesses, we are well placed to work with retailers in innovative ways to meet shoppers' needs. 

Sharing insights & innovations

In 2010 we expanded our network of Customer Insight and Innovation Centres (CiiCs), which allow us to work more closely with retailers to trial new strategies for merchandising, displays and packaging without having to run in-store pilots. The success in 2009 of our centre in New Jersey in the US has led us to open similar state-of-the-art centres in London, Paris, Singapore, Shanghai and Sao Paulo.

The concept has been embraced by our partners. Carrefour, for example, followed its inaugural visit to our Paris CiiC by sending country teams to our London, Shanghai and Sao Paulo centres where all experienced the same capabilities tailored to their own markets. 

A model for 'Perfect Stores'

Our Perfect Store programme is based on the concept that for every variation in geography and outlet size, from a US superstore to a small-town independent in China, there is an optimal merchandising layout for selling Unilever categories and brands. We are promoting these ‘perfect’ models to retailers. 

In 2010 we enlisted more than a million stores across our Asia, Africa, Central & Eastern Europe region.  Retail outlets enrolled in the programme have already shown faster growth than their competitors, while those outlets which have taken on all our Perfect Store recommendations are growing faster still. We will extend the programme to developed markets in Europe and North America.

Working with our customers on sustainability 

Over the past few years many of our large international customers have been taking a strong stance on sustainability by setting some ambitious targets in areas such as energy use, greenhouse gas emissions and waste.

The sustainability strategies of global retailers impact their suppliers, which include Unilever. This in turn has an impact on our own suppliers. We welcome this development as a powerful driver for improving sustainability knowledge and performance across a wide range of companies and sectors.

Our long-standing activities in the area of sustainability give us an opportunity not only to respond to the growing requirements of customers, but to share our expertise and explore opportunities for joint initiatives. We are increasingly engaging with retailers on sustainability, sharing our knowledge in areas such as sustainable agriculture, and measuring the lifecycle impacts of products. We work together to deliver innovative in-store programmes that help to educate and engage shoppers.

A good example is the work we are doing with Walmart. Here we continue to provide expert support in the areas of food and agriculture, chemical-intensive products, packaging, greenhouse gas reduction initiatives and its expansion into international markets.

In Mexico we initiated a collaborative supply chain project called Tetris with Walmart. This used lifecycle assessment to optimise case and pallet shipments to the retailer’s distribution centres. Implementation resulted in annual savings of 208 tonnes of CO₂ emissions and a 56% reduction in pallets. In 2011 we plan to expand Tetris at Walmart and roll it out to other customers.

In 2010 we were named Walmart’s Best Global Supplier. Our support for the retailer’s sustainability agenda and its expansion into fast-growing markets including India and China were highlighted as particularly significant. Also noted was our help in driving ongoing category growth in stores through product innovation and a series of well-executed programmes that encourage responsible consumption habits. We were also named 2010 Sustainable Supplier 2010 by Walmart Mexico and Central America, an award created to encourage good environmental practices and drive innovation in products and packaging.

Our initiative with Tesco in the UK is another example that demonstrates how we can work with our customers to engage shoppers in more sustainable practices. In October 2010, our Persil small & mighty detergent brand became the lead sponsor for Tesco's Energy Saving Week. Persil helped to communicate the money savings that consumers could achieve by washing at low temperatures. We also ran an in-store campaign to give consumers energy saving tips and make them aware of the environmental benefits of using concentrated liquid detergents.  

Working as an industry on sustainability - The Consumer Goods Forum

2009 saw the formation of the Consumer Goods Forum (CGF), a new industry association that brings together the CEOs and senior management of over 400 retailers, manufacturers, service providers and other stakeholders across 70 countries. Retailers include global companies such as Walmart and Carrefour as well as smaller national companies like Waitrose and Sobeys. Manufacturers include Nestle, The Coca-Cola Company and Kraft.

Governed by a board of 25 manufacturer CEOs and 25 retailer CEOs, the Forum aims to help the industry improve the way it meets the changing needs of the world's consumers. It will do this through increasing industry collaboration on non-competitive matters, to bring efficiency and simplicity for our consumers and through supporting the exchange of knowledge and good practices. 

An example of the CGF’s collaborative work is the third report in its Future Value Chain series called ‘Building Strategies for the New Decade’, published in 2011.  The project was led by Unilever and Metro and involved over 200 people from across the industry. Through detailed research and a series of eight workshops in different parts of the world, it sought to identify the factors that will most impact the industry over the next ten years. Among the ten trends detailed in the report are increasing urbanisation, growing consumer concern about sustainability, scarcity of natural resources and the increased importance of health and well-being. The analysis of these trends is informing the CGF’s strategic objectives as well as those of its individual member companies. 

Taking action on sustainability issues

Sustainability is one of the Forum’s focus areas and the CEOs of Unilever and Tesco are co-sponsors of the sustainability programme. They have set out the vision for the programme to drive and communicate sustainability improvements throughout the value chain of the consumer goods industry by:

• addressing sustainability challenges that impact our industry

• bringing global alignment and standards to non-competitive areas such as ethical sourcing

• developing and agreeing methodologies and metrics that measure sustainability improvements in our industry.

At the end of 2010, the board of the Consumer Goods Forum announced two resolutions resulting from the work of the sustainability programme. The first was to use its collective resources to help achieve zero net deforestation by 2020. The second was an agreement to begin phasing-out hydrofluorocarbon (HFC) refrigerants from 2015 and to replace them with more environmentally friendly non-HFC refrigerants. See Press Release for more.

The Forum will work to achieve both goals using a combination of individual company initiatives and by working in partnership with NGOs.

Another project in the sustainability programme is the development of a ‘common business language’ and common metrics for packaging and sustainability. This will enable a more efficient dialogue with companies along the value chain on ways to reduce the environmental impact of packaging, while preserving its many important functions. See Packaging & waste, Working with others for more information.