Unilever Nigeria recently announced its exit from the home care and skin cleansing markets in Nigeria to find a more sustainable and profitable business model.
This information was made known by Unilever Nigeria’s Secretary, Abidemi Ademola, who made the revelation in a corporate notice to the Nigerian Exchange Limited and signed.
Unilever claimed that by altering its business strategy, it would be able to expand more quickly and better serve the interests of customers, shareholders, and staff.
The company also stated that it anticipated that its withdrawal from these two categories over 2023 will lead to an overall increase in profitability, business growth, and sustainability.
The statement released reads in part, “this will involve repurposing the portfolio by exiting the home care and skin cleansing categories to concentrate on higher growth opportunities.
Strengthening business operations with measures to digitize and simplify processes; and focusing more on business continuity measures that reduce exposure to devaluation and currency liquidity in our business model.”
Unilever Nigeria’s home care and skin cleansing brand has a valuation of N50 billion, however, the company relayed that its profitability in Nigeria isn’t being maximized enough, as it looks to explore other markets.
Nigeria's beauty and personal care industry is anticipated to generate $7.87 billion in sales in 2023, according to Statista, a German company that does market research. Through 2027, this market sector is anticipated to rise by 16% annually.
According to the Nigerian Observer, a Nigerian news platform Unilever Nigeria Plc has two business segments, which are food products, and home and personal care. "In 2022, the firm realized N88.72 billion as revenue out of which the food products segment generated N42.6 billion or 48 percent while the home and personal care generated N46.09 billion or 52 percent of the company’s revenue. Almost all its revenue was generated in Nigeria.
The 2022 company-wide revenue was 25.8 percent higher than the N70.52 billion made in 2021. And by generating N31.01 billion in 2021, the food products segments accounted for 44 percent of Unilever Nigeria’s revenue while the home and personal care generated N39.51 billion, representing 56 percent of the company’s total revenue.
Profit before tax in 2022 was N9.86 billion, divided into N4.74 billion from food products, while home and personal care accounted for N5.12 billion. In 2021, food products’ profit before tax was N906.26 million while that of home and personal care amounted to N1.15 billion."