Potholes push Unilever off its path to glory

PERHAPS it was a typographical error when Unilever unveiled its Path to Growth almost five years ago. Judging from the latest quarterly results from the Slimfast-to-Dove soap group, it has been more a case of Pathetic Growth.

The path has been littered with more potholes than the A12 and as Unilever enters the final year of its journey, it looks as if someone has swapped the signs around - or that chief executive Niall FitzGerald has an aversion to speed cameras.

Unilever stops en route more than eight times a year to update investors on progress, but it is now time to take its foot off the brakes.

A growing aversion to carbohydrates may have stalled sales of Slimfast - who in their right mind would want a meal replacement drink if bacon and eggs are the alternative? - but that doesn't quite explain the meagre 3.2% growth over the past quarter in Unilever's 400 core products, such as Calvin Klein perfume and Domestos.

It may be better to travel hopefully than to arrive, but its ambitious plans to increase sales between 5% and 6% by the end of next year now look as likely as Northern Line trains running on time.

The Path to Growth was meant to be Unilever's salvation, but the reality is that it was pushed off track almost before the journey began.

Three years ago, Unilever spent £14.6 billion in less than two months buying Slimfast, Ben & Jerry's ice cream and Bestfood, makers of Knorr soup and Hellmann's mayonnaise. Just consider the £13 billion Unilever paid for Bestfood, which alone represented almost 30 times the company's projected earnings. Even the most optimistic food buyer would find it hard to justify such a high price.

It took less than 12 months for the damage to be seen in Unilever's accounts. Its stellar return of 9.6% in 1999 more than halved to 4.7% after the trio of acquisitions. Unilever must steer a more radical path to recover.

Sour taste

TODD Stitzer may sound like that guy who is sorting out Wall Street, but the only attribute he shares is his ability to say what he thinks.

The new chief executive of Cadbury Schweppes has discovered that the world's largest confectionery company is in a complete Curly Wurly and he is taking action.

Stitzer plans to cut ten% of the company's 55,000 workforce and close or sell a fifth of its 133 factories. He likes to call the programme Fuel for Growth, which sounds uncomfortably like Unilever's Path to Growth but this time around seems far more rigorous.

He complains that Cadbury Schweppes' past policy of buying companies was inefficient because they were never properly integrated. His candour is surprising because Stitzer's predecessor, John Sunderland, is now chairman.

Perhaps this was what Derek Higgs desired when his corporate governance code ruled that it could be appropriate for a chief executive to sometimes step up to chairman. He wanted them to be publicly humiliated for their failings.

Lies of the land

HELLO, is that Admiral Insurance? I want to report a stolen car.

How distressing. Before we start, I must inform you that our conversation is being taped. Now how did it happen?

It was so silly. I put my 13th Century Persian rug in the boot, popped back to the house to fetch my second Picasso (the other was already on the back seat) and returned to find my car missing from the drive.

How awful! And what a terrible coincidence that you had loaded it with such valuable goods.

I know. But it's even worse. My wife keeps her Tiffany engagement ring in the glove compartment. There have been been so many burglaries down our road, you see, that she thought it was safer.

You've mentioned the spate of burglaries before. The Monet was stolen from the drawing room in May, right? You were lucky the burglars didn't spot the Picassos then.

I know. Did I mention my wife's ring was four carats?

No. Did I mention that Admiral has introduced lie detector testing over the phone?

Er, not that I remember. Oh, my wife is mouthing at me. It was only half a carat. From Argos. How could I have been so silly?

Surprisingly, more than a quarter of people making claims from Admiral for stolen cars are lucky enough to refind their vehicles before they even get off the phone. Did you know that insurance fraud costs more than £1 billion a year?

Really? Don't these people have any shame? But I'll just double check the drive to be safe. There are so many trees that they sometimes obscure the view.

These are the valuable oaks destroyed by the storms last year?

Er, yes. I don't believe it! My car. It's here. Well, no need to bother you further. I know you're very busy.

It was a pleasure doing business with you, sir.