"Carrefour and Unilever deployment of a Global Supply Chain Strategy"

Carrefour, a global presence in 26 countries

n1 France n1 Spain n1 Belgium n1 Greece n2 Italy n1 Taiwan n1 Indonesia 561 hypermarkets 1324 supermarkets 2611 deep discounts stores 788 other store formats More than 9000 stores under banner

n1 Brazil

n1 Argentina

Unilever at a glance
We sell our Home & Personal Care and Foods brands in 150 countries Overall 1999 turnover of US$ 45,790 million

43rd by turnover in the Fortune 500 list of largest companies (August 1999)
Recent major acquisitions: Amora Maille (F), Ben&Jerrys (USA), Slim Fast (USA), and Bestfoods (USA)

Carrefour objective
The excellence of the supply chain:
No out of stocks on the shelf Lowest total inventories Faster cycle times Automation of all information flows

Lowest total delivered cost (supplier to

shelf)

Carrefour supply chain vision

The target organization:
Supplier Daily sales & inventory data per store Cross-docking platform Daily sales & inventory data Store

Continuous replenishment (A to B delivery) No Backroo m inventory

No inventory

One of Carrefours Key Strategies

Collaborative approach with our suppliers
More sharing of information Greater supplier involvement in the replenishment process Greater accountability:
Shared objectives
Inventory levels Cycle times Service rates, etc,

Performance indicators and score cards

Carrefour and Unilever scope of operations

Commercial relationship in all Carrefour Countries
Involvement of 57Unilever Companies

Across all Unilever categories

Mutually important business partners With a shared ambition for growth and operational global excellence

Carrefour & Unilever - A mature Supply Chain in Europe

EDI rolled out at 100% in all major countries CMI with common tools and processes Building experience with ABC costing and Product Availability & Traceability

Results Improvements in Service levels Significant costs reduction Robustness of operations Better integration of work flows

Definition of a Global Common Supply Chain Strategy

Corporate commitment to promote process improvements globally Use a standard scorecard to monitor current situation Implement Best Practices
EDI Co managed inventory

Global roll out plan for overseas regions (Latin America and Asia) Close cooperation on plan management

Implementation of the strategy in Asia and Taiwan in particular

Asia is the fastest growing Carrefour region
Capabilities and openness on new technologies Three priority countries:
Taiwan Korea Thailand

Taiwan the biggest Asian country for Carrefour

An adapted infrastructure for a facilitated roll out

Scorecard
Supplier ECR Score Card Carrefour - Unilever
Row Fill Nb in 1 - Logistic volumes
11 12 13 14 21 S S S S C Turnover Number of parcels Number of orders Number of parcels per order Purchase price indicator parcels M LC(*) x1000 parcels

Indicators

Indicator unit

N-1

Target N

To date result

Jan.

Feb.

Mar.

Apr.

May.

Jun.

Jul.

Aug.

Sept.

Oct.

Nov.

Dec.

2 - Sales competitiveness 3 - Administrative performance

31 32 S S Billing accuracy Number of operationnal EDI messages %

4 - Logistic performance 4.1 Supplier

411 412 413 414 421 422 423 424 425 431 432 433 C S C C C C C C C C C C Product availability Delivery lead time On time deliveries Proposal orders modified (CMI) % Nb of days % % % % Nb of days K LC(*) Nb of pallets % Nb of days K LC(*)

4.2 - Carrefour warehouse

Product availability A to B store deliveries Inventory level in days Inventory level in value Inventory level in pallets

4.3 - Carrefour store

Out of stock on the shelf Inventory level in days Inventory level in value

5 - Logistic benefits C 5.1 - Real operational savings C 5.2 - Estimated operational saving * LC : local currency

Scorecard
Supplier ECR Score Card Carrefour - Unilever
Row Fill Nb in 1 - Logistic volumes
11 12 13 14 21 S S S S C Turnover Number of parcels Number of orders

Indicators

Indicator unit

N-1

Target N

To date result

Jan.

Feb.

Mar.

Apr.

May.

Jun.

Jul.

Aug.

Sept.

Oct.

Nov.

Dec.

Row Fill M LC(*) Nb in x1000 parcels 1 - Logistic volumes

11 12 13 14 S S S S Turnover
parcels

Indicators

Indicator unit
M LC(*) x1000 parcels parcels

Number of parcels per order Purchase price indicator

2 - Sales competitiveness 3 - Administrative performance

31 32 S S Billing accuracy

Number of parcels % Number of orders Number of parcels per order

% Nb of days % % % % Nb of days K LC(*) Nb of pallets % Nb of days K LC(*)

Number of operationnal EDI messages

4 - Logistic performance 4.1 Supplier

411 412 413 414 421 422 423 424 425 431 432 433 C S C C C C C C C C C C Product availability Delivery lead time On time deliveries

Proposal orders modified (CMI)

4.2 - Carrefour warehouse

Product availability A to B store deliveries Inventory level in days Inventory level in value Inventory level in pallets

4.3 - Carrefour store

Out of stock on the shelf Inventory level in days Inventory level in value

5 - Logistic benefits C 5.1 - Real operational savings C 5.2 - Estimated operational saving * LC : local currency

Scorecard
Supplier ECR Score Card Carrefour - Unilever
Row Fill Nb in 1 - Logistic volumes
11 12 13 14 21 S S S S C Turnover Number of parcels Number of orders Number of parcels per order Purchase price indicator parcels M LC(*) x1000 parcels

Indicators

Indicator unit

N-1

Target N

To date result

Jan.

Feb.

Mar.

Apr.

May.

Jun.

Jul.

Aug.

Sept.

Oct.

Nov.

Dec.

2 - Sales competitiveness 3 - Administrative performance

31 32 S S Billing accuracy Number of operationnal EDI messages

4 - Logistic performance 4.1 Supplier

411 412 413 414 421 422 423 424 425 431 432 433 C S C C C C C C C C C C Product availability Delivery lead time On time deliveries Proposal orders modified (CMI)

Row Fill % Nb in
Nb of days

Indicators

Indicator unit
%

3 -%Administrative performance
31 %
% 32 % % Nb of days K LC(*) Nb of pallets % Nb of days K LC(*)

S S

Billing accuracy Number of operationnal EDI messages

4.2 - Carrefour warehouse

Product availability A to B store deliveries Inventory level in days Inventory level in value Inventory level in pallets

4.3 - Carrefour store

Out of stock on the shelf Inventory level in days Inventory level in value

5 - Logistic benefits C 5.1 - Real operational savings C 5.2 - Estimated operational saving * LC : local currency

Scorecard
Supplier ECR Score Card Carrefour - Unilever
Row Fill Nb in 1 - Logistic volumes
11 12 13 14 21 S S S S C Turnover Number of parcels Number of orders Number of parcels per order Purchase price indicator parcels M LC(*) x1000 parcels

Indicators

Indicator unit

N-1

Target N

To date result

Jan.

Feb.

Mar.

Apr.

May.

Jun.

Jul.

Aug.

Sept.

Oct.

Nov.

Dec.

2 - Sales competitiveness 3 - Administrative performance

31 32 S S Billing accuracy Number of operationnal EDI messages %

4 - Logistic performance 4.1 Supplier

411 412 413 414 421 422 423 424 425 431 432 433 C S C C C C C C C C C C Product availability Delivery lead time On time deliveries Proposal orders modified (CMI)

Row Fill % Nb in Nb of days

%

Indicators

Indicator unit

4.2 - Carrefour warehouse

Product availability A to B store deliveries Inventory level in days Inventory level in value Inventory level in pallets

4 -%Logistic performance % 4.1 Supplier

Nb of days Nb of pallets

411 412 413 %

C S C C

Product availability Delivery lead time On time deliveries Proposal orders modified (CMI)

% Nb of days % %

K LC(*)

4.3 - Carrefour store

Out of stock on the shelf Inventory level in days Inventory level in value

Nb of days

414 K LC(*)

5 - Logistic benefits C 5.1 - Real operational savings C 5.2 - Estimated operational saving * LC : local currency

Scorecard
Supplier ECR Score Card Carrefour - Unilever
Row Fill Nb in 1 - Logistic volumes
11 12 13 14 21 S S S S C Turnover Number of parcels Number of orders Number of parcels per order Purchase price indicator parcels M LC(*) x1000 parcels

Indicators

Indicator unit

N-1

Target N

To date result

Jan.

Feb.

Mar.

Apr.

May.

Jun.

Jul.

Aug.

Sept.

Oct.

Nov.

Dec.

2 - Sales competitiveness 3 - Administrative performance

31 32 S S Billing accuracy Number of operationnal EDI messages %

4 - Logistic performance 4.1 Supplier

411 412 413 414 421 422 423 424 425 431 432 433 C S C C C C C C C C C C Product availability Delivery lead time On time deliveries Proposal orders modified (CMI) % Nb of days % % % % Nb of days K LC(*)

4.2 - Carrefour warehouse

Product availability A to B store deliveries Inventory level in days Inventory level in value Inventory level in pallets

Row Fill Nb in

Indicators

Indicator unit

4.3 - Carrefour store

Out of stock on the shelf Inventory level in days Inventory level in value

4 - Logistic performance Nb of pallets 4.2 - Carrefour warehouse

% Nb of days K LC(*)

421 422 423 424 425

C C C C C

Product availability A to B store deliveries Inventory level in days Inventory level in value Inventory level in pallets

% % Nb of days K LC(*) Nb of pallets

5 - Logistic benefits C 5.1 - Real operational savings C 5.2 - Estimated operational saving * LC : local currency

Scorecard
Supplier ECR Score Card Carrefour - Unilever
Row Fill Nb in 1 - Logistic volumes
11 12 13 14 21 S S S S C Turnover Number of parcels Number of orders Number of parcels per order Purchase price indicator parcels M LC(*) x1000 parcels

Indicators

Indicator unit

N-1

Target N

To date result

Jan.

Feb.

Mar.

Apr.

May.

Jun.

Jul.

Aug.

Sept.

Oct.

Nov.

Dec.

2 - Sales competitiveness 3 - Administrative performance

31 32 S S Billing accuracy Number of operationnal EDI messages %

4 - Logistic performance 4.1 Supplier

411 412 413 414 421 422 423 424 425 431 432 433 C S C C C C C C C C C C Product availability Delivery lead time On time deliveries Proposal orders modified (CMI) % Nb of days % % % % Nb of days K LC(*) Nb Rowof pallets Fill Nb % in Nb of days K LC(*)

4.2 - Carrefour warehouse

Product availability A to B store deliveries Inventory level in days Inventory level in value Inventory level in pallets

4.3 - Carrefour store

Out of stock on the shelf Inventory level in days Inventory level in value

Indicators

Indicator unit

5 - Logistic benefits C 5.1 - Real operational savings C 5.2 - Estimated operational saving * LC : local currency

4 - Logistic performance 4.3 - Carrefour store

431 432 433 C C C Out of stock on the shelf Inventory level in days Inventory level in value % Nb of days K LC(*)

Co-Managed Inventory (CMI)

PHYSICAL STOCKS MOVEMENTS FORECASTS +

ORDER PROPOSAL DELIVERY ORDER

STOCKS & WHAREHOUSE MOVEMENTS

CLIENT

ORDER CONFIRMATION
LEVER STOCK

CARREFOUR STOCK

CL

IE

ORDERS
N T

E.D.I. Physical flow of products

Supply Chain optimization in Taiwan very promising results

Improved service from Unilever to Carrefours warehouse
on time deliveries = +7% product availability = +20%

Increased service from Carrefour s warehouse to stores

product availability = +11%

While

Reducing stocks by 40% Reducing delivery lead times by one day

What is:
A stand-alone profit-oriented business :
with its own management team focused on delivering efficiency to :
the retail community, its suppliers

through the use of internet based transaction and collaboration tools.

A business whose services are available to all retailers, regardless of equity participation. It is not a central buying office .

The

equity members

Pinault Printemps Redoute

A global purchase turnover > to US$ 200 billion

A members commitment to bring 70% of this purchase amount on GNX

The
Sourcing Suppliers and Products

valuable services
Additional Value Added Services Applications
Applications

Workflow

Catalogues Web-Enabled, Dynamic Trading

Communication Tools

Collaborative Product Development

Collaborative Planning, Forecasting and Replenishment (CPFR)

Unilever: one of the chosen partners involved in GNX design and implementation
Prove transaction capabilities on the Net Set up a migration plan from existing EDI to GNX Develop a standardized approach for the product catalog with the other GNX partners

Build supply chain optimization capabilities (CPFR)

Taiwan a GNX pilot country

Two pilot countries: France and Taiwan Pilot objective: move EDI communication to internet enabled transaction on GNX

Steps:
Prove end to end communication based on new internet protocol Migrate current EDI messages on GNX Parallel run to test robustness Go live

A view to the future of EDI communication

Supplier Browser access GNX Web Web EDI EDI B2B Hub

Internet
Classic Classic EDI EDI

Supplier EDI platform

Potentially: - All countries - All suppliers

Carrefour gateway Carrefour private network

Unilever gateway Unilever private network

Expected benefits from GNX

Unify all current processes and tools Reduce communication costs ( Internet Vs VANs) Handle existing EDI flows

Promote the use of common worldwide standards

Use in the future an easily and universally understandable language (XML) Enable access to other GNX functionality

GNX pilot next steps

Roll out of Unilever Carrefour learnings to all Carrefour countries
Pursue pilot developments
Product catalogue CPFR

Carrefour to extend process roll out to all suppliers

GNX a new tool for our Global Supply Chain Strategy

Global transactional capabilities Definition and use of a global communication standard Global data alignment and synchronization Ability to deploy standard processes globally Automation of all information flows with suppliers (including smaller ones) Web EDI Advanced Supply Chain collaboration

Conclusion
A successful and promising collaboration:
A common and consistent strategy A global roll out Key learning for further implementation (new partners, new countries)

GNX, a tool to accelerate such initiatives

Most advanced technology Wild range of functionality enabling implementation of global best practices

Thank you for your attention