Submitted by:

Rohit Yadav-P182B65

Damandeep Singh-
P182B14

Kartik Mehrotra-P182A20

Chayya Rathi-P182B52
• Uniglobe is a consumer goods company operating in Philippines since 1989
• The company was headquartered in US and it had a large customer reach in 5 continents
• Company has a strong presence in terms of consumer goods like healthcare ,beauty care
,paper ,food and beverages.
• The company performed exceedingly well in the year 1996 where the profit rose
unexpectedly to 30%
• Since then the company is relying on high expectations and wants to meet higher goals
year by year
• Uniglobe Sales Operations: 1) Wholesale Trade Division, 2) Small wholesale Trade
Division, 3)International Supermarket Trade Division, 4) SLS Division
 Introduced in 1995,SLS was designed to create a new distribution channel and cater
rural people
 The company wanted its products to reach to small geographical dispersed and hard
to reach retailers
 The Uniglobe SLS division was managed through 3 national distributors, who had an
exclusive contract with Uniglobe
 Distributors were required to make all capital investments, however Uniglobe would
assist them in training their salesforce and help them in doing effective and efficient
business
 Distributors were paid on the return of investment they had put up in setting up the
warehouses.
 SLS model only accepted cash, therefore the distributors did not have accounts
receivable.
 SLS was one of the worst performers in terms of profitability compared
with other trade channels
 SLS provided lower incremental margins despite of volume sales
 The dilemma that Martinez faces every quarter is whether they would
risk pulling out SLS and losing volume sales from this particular trade
channel
 Pulling out of the SLS division would require paying a compensation the
distributers
 The SLS is not performing well because they are paying high
commission to distributor on the investment they had made in setting
up the business.
 As per recommendation, we would suggest the SLS operation to be
incorporated in-house.
 This would provide more control on the channel by UniGlobe, thus
increasing the gross profit margins by 2.5% annually by eliminating the
commission paid to distributers
 Eventually this process would make it more compatible with UniGlobe’s
standard corporate business model
 However, this would involve onetime capital investment and a increase in
fixed costs
 In addition to the above, the ROI would decrease from 15% to 12%