Unilever South Africa free essay sample

Unilever’s however decided to continue investing in the South African economy. Unilever’s Capital Expenditure between 1980 and 1985 exceeded R192 million with Lever Brothers buying Reckitt–Columbus, the industrial division of Reckitt and Colman, in 1982 and then adding a new NSD Plant and Oil Mill in Boksburg, an upgraded Bath soap manufacturing facility in Durban and production facilities for silica gels. 1985 marked the acquisition of Brooke Bond Oxo, followed by Cheesebrough Ponds in 1987, Simonsberg Cheese in 1988 and the local Elizabeth Arden business in1989. Ola ice cream was established in 1994 and Van Den Bergh amp; Jurgens and Lipton were merged to establish Unifoods as an integrated foods business. Extensive capital investment was made in new IT systems, innovation in soap powders (concentrates), and in new foods. Unilever continued to consolidate and, in 1996, Lever Brothers and Elida Ponds merged to form a strong home and personal care company called Lever Ponds. In 2004, in line with the Global name alignment, Lever Pond’s was renamed Unilever South Africa Home and Personal Care. On the same basis, the Foods business was renamed Unilever South Africa Foods. In 2007 , Unilever South Africa Home and Personal Care and Unilever South Africa Foods were merged together to form the company we today call Unilever South Africa Pty Ltd HOW UNILEVER WORKS. The current Unilever corporate logo was introduced in 2004 and was designed by the brand consultancy Wolff Olins. It is composed of 24 icons woven together to create a U shape, with each icon representing one of the companys sub-brands or its corporate values. [37] The brand identity was developed around the idea of adding vitality to life For three consecutive years Unilever has made an impact at the Product of the Year Awards, even scooping 12 awards in the year 2011. This is testimony to the effort Unilever takes to ensure that its products are of superior quality. It therefore has an edge over its competition in this respect which helps retain and increase the number of customers it has. In 2011 Unilever South Africa ranked No1 Large Sized Employer and No1 FMCG Employer at the CFR SA Best Employers Awards 2011. It also ranked 4th on the Overall Best Employer. Unilever therefore has a knack for employee satisfaction. It has satisfied employees in terms of remuneration, good working conditions and equal/fair treatment of all employees. With obviously motivated employees Unilever is able to conduct operations efficiently and effectively. This ensures that the company’s annual goals are attained and maximum profits are made. Unilever biggest strength is its brands. Sunlight is Unilever’s largest selling brand, while others such as Omo, Lux, Lipton, Ola and Knorr are famous household names. Unilever operates in nine product categories. These are namely laundry, savoury and dressings, skincare and cleansing, margarine, deodorants, household care, tea, hair care and ice cream. It leads the market in seven of these categories Consumer research also plays a vital role in brand development. Unilever’s excellent strategy of creating strong brands has ensured that over the years the company’s products have continued to have a strong presence in the market. Strong branding also helps their brands be more attractive to the final consumer who would probably purchase them over the competition. REASONS FOR HAVING A LARGE EFFECT ON THE ECONOMY. Unilever South Africa and its employees were responsible for generating an output of more than R32 billion in the process, supporting approximately 100Â  000 jobs throughout South Africa’s economy.. In total this represents 0. 8% of South Africa’s total employment. Unilever South Africa sources from over 3 000 suppliers and half of its R4. 5 billion purchasing spend goes to South African suppliers. Unilever South Africa is responsible for a number of other important economic effects as well. The company has also made very significant tax revenues for the government, which is a total some R4 billion, equivalent to almost 0. % of all government revenue. Analysis shows that Unilever South Africa contribution to value added throughout the economy amounted to R12. 5 billion in 2005, or around 0. 9% of the countrys GDP. The GDP multiplier indicates that for every R100 of Unilever South Africa sales revenue, R145 is added to the countrys GDP. The company offers extensive trai ning for its own workers as well as for non-workers and the unemployed, who participate in South Africa’s learnership schemes, which is a key component of the governments skill-building initiatives. The cost of this training was equal to 2. % of corporate payroll in 2005. The quality of the training is superb since some of their employees are lured away to other companies. While it is a challenge to continue retaining them it is positive for the South African Economy since since the local firms benefit. These firms may not have the capacity to provide such excellent training which is a further bonus to the economy. Unilever South Africa further influences South Africa’s economy and its social well-being through its Corporate Social Investments (CSI) projects and its efforts to promote Black Economic Empowerment (BEE). Unilever South Africa CSI programmes have had an emphasis on meeting the challenges of HIV/Aids; the improvement of education and of educational opportunities for disadvantaged citizens. Many of these activities have been carried out in close co-operation with the government of South Africa. In line with BEE It is now recruiting heavily among previously disadvantaged individuals for the next generation of upper management. It therefore has one of the most excellent BEE score cards. Another area in which Unilever South Africa contributes to South Africa is through its environmental policies and programmes. The company uses global environmental standards that even exceed those found within South Africa. POSITIVE EFFECTS ON THE ECONOMY. Creation of emplotment-Unilever has been able to provide employment for many South Africans. This helps to alleviate poverty since more people are able to support themselves using jobs that Unilever has provided. Revenue to the government-Unilever is an umbrella company with many different brands under it working independently. All these different brands are taxed by the government. The revenue attained by the government can be used for the benefit of the whole country by for example building infrastructure. Corporate Social Investment(CSI)- Communities within South Africa’s economy benefit from CSI projects which help improve their standards of living. This helps the economy be more conducive for business by reducing poverty and therefore crime. NEGATIVE EFFECTS ON THE ECONOMY. Pollution-Unilever has taken measures to reduce the amount of harmful emission of pollutants into the environment. But due to the nature of the manufacturing process harmful emissions are still released into the environment. This causes illness to the human resource which reduces productivity. The mortality rate could also be lowered which has less productive workers in the economy. Competition for local firms-Local firms experience stiff competition from Unilever. They are of much smaller capacity to Unilever. As a result local industries are killed since they do not have the means to compete with the multinational. This results in fewer job opportunities for the population. Consumers are also limited for choice since local products get less availability in the market. Investment in other countries-Unilever is a multinational and has many bases throughout the planet. Profits attained from the South African market could therefore be used to invest in its interests in other nations. This drains the South African economy of revenue that could have been used for the benefit of the South African economy. MEDIA ARTICLES Report on media articles Unilever’s desire to continue expanding in South Africa is evident. They have pledged to continue investing in the South African economy by introducing even ,ore brands into the economy. Some local brands have also been purchased to further establish Unilever’s influence on the South African economy. A billion rand has also been invested to continue producing its brands. Sources http://www. unilever. co. za Measuring Unilever’s Economic Footprint-Ethan B Kapstein http://en. wikipedia. org/wiki/Unilever | [Type the abstract of the document here. 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