...Running Head: THE GILLETTE COMPANY The Gillette Company: An assessment of past performance and future outlook for the brand Yinka Daramola National University, CA November, 2014 Abstract 3 Organizational Overview 4 Case Breakdown 5 Challenges 7 Market Impact 10 Projected Outcome 11 Question 1: Gillette has successfully convinced the world that “more is better” in terms of number of blades and other razor features. Why has that worked in the past? What’s next? 12 Question 2: Some of Gillette’s spokespeople such as Tiger Woods have run into controversy after becoming endorsers for the brand. Does this hurt Gillette’s brand equity or marketing message? Explain. 13 Question 3: Can Gillette ever become as successful at marketing to women? Why or why not? 14 Summary 16 References 18 Abstract This paper seeks to analyze the super-brand Gillette. It discusses its history, strategic growth techniques, and current global success metrics. The methods used to gain and maintain market share are scrutinized, along with the impact of its current alliance with the Procter & Gamble Company on its growth. The current product life cycle stage is identified, and suggestions are made regarding approaches to maintain and grow its global market share. The Gillette Company: An assessment of past performance and future outlook for the brand Organizational Overview Founded in 1903 by King C. Gillette and Will Nickerson as an innovative approach to improving men’s...
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...Analysis……………………………………………………………………..18 Conclusion………………………………………………………………………………20 References and Bibliography…………………………………………………………..22 INTRODUCTION Procter and Gamble is the world’s largest consumer goods company which operates in more than 180 countries around the world. It has more than 300 brands in beauty, health, fabric home, baby, family and personal care products. More than 20 of P&G's brands are billion-dollar sellers, including Actonel, Always/Whisper, Braun, Bounty, Charmin, Crest, Downy/Lenor, Folgers, Gillette, Iams, Olay, Pampers, Pantene, Pringles, Tide, and Wella, among others. It operates in America, Europe and Asia. It is headquartered in Cincinnati, Ohio and employs 138,000 people. P&G generated revenue of $68,222 million in the fiscal year of 2006. This is a whooping 20.2% increase from 2005. The net profits also went up by a massive 25.4% from 2005. HISTORY AND BACKGROUND William Procter, a candle-maker, and James Gamble, a soap-maker, formed the company known as Procter & Gamble in 1837. The company prospered during the nineteenth century. In 1859, sales reached one million dollars. At this point, approximately eighty employees worked for Procter & Gamble. During the American Civil War, the company won contracts to supply the Union Army with soaps and candles. In the 1880s, Procter & Gamble began to market a new product, an...
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...first global business? 4 2) Its Global business activity during the last 5-10 years ………………………………...6 3) What global initiatives the company has taken up currently and in the immediate future? 8 4) Can you suggest any alternative to its given future plan of expansion abroad? 10 5) Due to recent financial meltdown and the continuing recession/ slowdown in some developed countries , have some of the recently introduced expansion plans of your company become vulnerable? 12 6) What remedial measure / plan can you suggest? 14 7) Your suggestions for taking the company’s global businesses to the next level? 15 8) References…………………………………………………………………………….17 Executive Summary Procter and Gamble (P&G) was founded by William Procter and James Gamble on October 31, 1837. The company is now the largest company and brand in Fast Moving Consumer Goods (FMCG) industry. The company, today, deals with personal care product, pet food and cleaning agents. The company scored $83.86 billion sales in 2012 and ranks 1st in the Fortune magazine’s “Global Top Companies for Leaders.” The company as on February 19, 2013 has a market capitalization of $ 211.38 bn (Source: Yahoo Finance). The company has simple expansion plan. They have, since early days, have believed in both organic and inorganic growth. The company cultivated and grew in house brands for their organic growth. This includes the names of “Ivory” soap, “Tide” detergent, “Pampers” diapers, etc. These...
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...Procter & Gamble Equity Valuation & Analysis As of November 1, 2007 Raider Investments Group Brian Hooper Tyler Yenzer Nathan Yosten Dustin Bradford Brian.D.Hooper@ttu.edu Phillip.T.Yenzer@ttu.edu Nathan.Yosten@ttu.edu Dustin.Bradford@ttu.edu Table of Contents Executive Summary Business & Industry Analysis Company Overview Industry Overview Five Forces Model Rivalry Among Existing Firms Threat of New Entrants Threat of Substitute Products Bargaining Power of Buyers Bargaining Power of Suppliers Key Success Factors Firm Competitive Advantage Analysis Future Competitive Analysis Accounting Analysis Key Accounting Policies Potential Accounting Flexibility Actual Accounting Strategy Quality of Disclosure Qualitative Analysis of Disclosure 36 31 33 35 10 11 13 13 18 20 22 24 24 28 30 5 2 Quantitative Analysis of Disclosure Sales Manipulation Diagnostics Expense Manipulation Diagnostics Potential “Red Flags” Undo Accounting Distortions Financial Analysis Liquidity Analysis Profitability Analysis Capital Structure Analysis IGR/SGR Analysis Financial Statement Forecasting Cost of Equity Estimation Valuation Analysis Multiples Valuation Discounted Free Cash Flow Model Discounted Dividends Model Residual Income Model Long-Run Return on Equity Residual Income Model Abnormal Earnings Growth Model Credit Analysis 40 41 44 49 49 50 63 72 76 79 83 86 95 96 98 100 103 106 3 Analyst Recommendation Appendix Regression Analysis Income Statement Balance Sheet Statement...
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...| Procter & Gamble | GEB 4890 | | Hessum Zangenehpour | Fall 2013 | | Table of Contents Executive Summary ……………………………………………………………………………………………………………… Page 2 The Company………………………………………………………………………………………………………………………… Page 2 History and Evolution……………………………………………………………………………………………….. Page 2 Mission and Major Goals…………………………………………………………………………………………. Page 2 Current Strategies……………………………………………………………………………………………………. Page 7 Competitive Environment…………………………………………………………………………………………………….. Page 14 Industry…………………………………………………………………………………………………………………… Page 15 Forces and Trends…………………………………………………………………………………………………… Page 18 Consolidating Retail Sector…………………………………………………………………………. Page 19 Private Labels…………………………………………………………………………………………….. Page 20 Competition……………………………………………………………………………………………… Page 20 Porter’s Five Forces………………………………………………………………………………………………. Page 21 Ethical Responsibilities and Challenges ……………………………………………………………….. Page 25 Environmental pollution…………………………………………………………………………… Page 26 Energy Consumption………………………………………………………………………………… Page 26 Possible challenges facing Procter and Gamble…………………………………………………….. Page 27 Internal Strengths and Weaknesses…………………………………………………………………………………. Page 28 Recommendations ………………………………………………………………………………………………………….. Page 37,45 Implementation……………………………………………………………………………………………………………….. Page 40,45 Evaluation…………………………………………………………………………………………………………………………...
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...P&G Case Executive Summary This case study analysis is on the Proctor & Gamble Company (also referred to as “P&G”). Procter & Gamble is the world's largest producer of household and personal products by revenue, with its products reaching 4 billion people worldwide. The Case Study includes an Introduction, Company Overview, Company Mandate, Internal Analysis, and External Analysis, followed by various Strategic Options (see below). The author then makes a Final Strategy Option Recommendation. Strategic Option #1: Market to Lower-Income Consumers in both Developed and Emerging Markets (Expand and Build Beauty Segment strictly aimed at Low-Income Consumers). Industry Consolidator. Strategic Option #2: Given the maturity of the North American/Western European market, combined with the emerging popularity and demand for Natural/Organic ingredient products, P&G should look to create New Natural Products and Products tailored to the Male market - Multiple Segments, not just Skin Care (Expand and Build Beauty Segment). Industry Consolidator. Strategic Option #3: Related Diversification through Acquisition. Strategic Option #4: Joint Ventures in Emerging Markets such as China and India. Final Strategy Recommendation: The Recommendation is to go for a combined Low-Income segment and New Natural Product strategy as this facilitates P&G’s need to capture a greater slice of the Low-Income consumer market both in Mature and Developing markets, which also capturing a greater...
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...Contents 1.0 Introduction 1 1.1 Procter and Gamble (P&G), as a whole 1 1.2 Procter & Gambles Sverige AB 1 2.0 Marketing Campaign 2 2.1 Overview 2 2.2 Campaign Impact 3 3.0 Marketing Strategy 3 3.1 Analysis of Advertisement in Sweden 3 3.1.1 Root Cause Analysis (RCA) 4 3.1.2 Proposed Solutions and Possible Outcomes 4 3.2 Barriers of Communication 4 4.0 SWOT Analysis of P&G Sverige AB 6 4.1Strength 6 4.2 Weakness 6 4.3 Opportunity 6 4.4 Threats 6 4.5 SWOT Matrix Analysis 7 5.0 Marketing mix analysis 7 5.1 Product analysis 7 5.2 Price Analysis 8 5.3 Place/Distribution Analysis 9 5.4 Promotion Analysis 9 6.0 Conclusion 9 7.0 Appendices 10 1.0 Introduction 1.1 Procter and Gamble (P&G), as a whole The Procter & Gamble Company (also known as P&G) initiated a partnership agreement between William Procter and James Gamble, at the year of 1837. The small business was initially a soap and candle shop, but now an American Multinational Company (MNC) for Fast Moving Consumer Goods (FMCG). P&G who has never neglected the importance of human capital and being passionately develop talents that show great curiosity, appreciation towards diversity, and flexibility in tackling tricky problems. With that, P&G has been rated as the Top 7 in the World’s Top Employers for New Grads at the year of 2014 (refer Figure 1). Comparing between Procter and Gamble (P&G), Colgate-Palmolive (CL), and Unilever, P&G...
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...Strategic Management Case Study Unilever Focusing on East for Growth Word Count: 3984 Question 1 Unilever is an Anglo Dutch company that has been established in 1929 as a result of a merger between 2 companies: Lever Brothers and Margarine Unie. UNILEVER owns consumer products in; Food and Beverages, Cleaning agents and Personal care. It is now ranked as the second world largest consumer product company. Strategic Purpose: Unilever’s 2nd rank in FMCG has been gained by serving the company’s mission “to meet everyday’s needs for nutrition, hygiene, and personal care with brands that help people look good, feel good, and get more out of life”. Value Chain Analysis Porter’s value chain analysis gives insight on how Unilever creates competitive advantage. It provides deeper understanding to establish a SWOT analysis in order to arrive at the applicable Ansoff theory. It describes Unilever’s primary and support activities’ characteristics (Figure 1). Figure [ 1 ] Primary Activities Inbound & Outbound Logistics: Unilever had put a five-year strategy plan, called the “path to growth” to transform its inbound logistics in way that increases efficiency and saves money to be invested elsewhere outside the business. This plan started in North America by integrating six operating business and emerging 3 supply chains. The philosophy of this change was to create one single set of distribution centers that attain the 24hour delivery plan to the customer. Transportation...
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...History of Proctor & Gamble William Procter & James Gamble 1837 Neither William Procter nor James Gamble ever intended to settle in Cincinnati. Although the city was a busy center of commerce and industry in the early nineteenth century, William, emigrating from England, and James, arriving from Ireland, were headed farther west. Despite their intentions, however, both men ended their travels when they arrived at the Queen City of the West—William took care of his ailing wife, Martha, who soon died, and James sought medical attention for himself. William Procter quickly established himself as a candle maker. James Gamble apprenticed himself to a soap maker. The two might never have met had they not married sisters, Olivia and Elizabeth Norris, whose father convinced his new sons-in-law to become business partners. In 1837, as a result of Alexander Norris' suggestion, a bold new enterprise was born: Procter & Gamble. On April 12, 1837, William Procter and James Gamble start making and selling their soap and candles. On August 22, they formalize their business relationship by pledging $3,596.47 apiece. The formal partnership agreement is signed on October 31, 1837. 1850 The Moon and Stars began to appear in the 1850s as the unofficial trademark of Procter & Gamble. Wharf hands used the symbol to distinguish boxes of Star Candles. By the 1860s, the Moon and Stars appeared...
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...Executive Summary In this report, I would state and analyze Procter and Gamble (P&G). In the beginning, P&G had just supply soap and candles to the Union armies, but now it has become to a global manufacturing, distribution, and marketing company focusing on providing branded products with superior quality and value. It provided over 300 brands reaching consumers in about 140 countries. P&G is focusing on provided fashion, high quality products for consumers. In order to satisfy consumers, P&G segment its consumers into different group, such as age, gender, ethnicity, material status, and low income consumers. With the segmentation, P&G could analyze what consumers’ demand. Human’s living standard is improved rapidly. People is getting to pay more attention on cleaning products to keep their bodies clean and looking good. Most of the people thought that beauty/feminine care products were just for females, but actually the number of men spending time in front of the mirror, grooming themselves had increased. With the growing trend for men to use beauty products, P&G started manufacturing more products for them and try to satisfy their needs. For example, they designed the products so that they would attract male consumers, by using dark colors for the packaging so that it looked more masculine. P&G is always try to satisfy needs of consumers. With a company which had more than 100 years history, P&G was strong in brand quality reputation, price competition, scales of economic...
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...Proctor & Gamble Making Everyday Life Better Executive Summary In the billion-dollar industry that is consumer packaged goods, one of two key giants is Proctor & Gamble (P&G), an Ohio-based company that specializes in consumer packaged products. Throughout this paper, I will show that P&G is a leading consumer packaged goods company with a very promising future ahead of them. I will discuss the market structure in which they operate, the marketing approaches that they use and conduct a brief financial analysis of the company. I will conclude by making several recommendations as to how the company can continue their successful growth pattern, including technological advances, response to consumer preferences, research and development (R&D) of new products and creating brand loyalty among their consumers. Company Overview P&G is a global leader in retail goods focused on providing branded consumer packaged goods of superior quality and value to their customers around the world. They began in Cincinnati Ohio as a small family-operated soap and candle company in 1837. Their products are sold in more than 180 countries and territories primarily through mass merchandisers, grocery stores, membership clubs stores, drug stores, department stores, salons and high-frequency stores. P&G produces nearly 300 different brands with annual sales of $84 billion. Popular brands include Pampers, Always, Bounty, Pantene, Zzzquil, Tide, and Downy. P&G have...
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...* 1.0 EXECUTIVE SUMMARY Gillette has been the leading brand in men's grooming industry across the globe. With its wide range of products caters to the premium segment of the men's grooming market. It faces intense competition in the toiletries market whereas the competition in the razor market is not that intense. This case study aims at identifying the problems faced by Gillette in the toiletries market. We have suggested a plan for Gillette toiletries along with other suggestions for Gillette to face the competition in the near future and the long run. 2.0 SITUATIONAL ANALYSIS Of Gillette's recent moves, by far the riskiest is the toiletries line. Gillette's track record there is spotty, with successes in the 1960s and 1970s followed by a series of disappointments, such as a failed foray into European women's toiletries in the 1980s. But Gillette's strength is with men, and executives are convinced they can use their strong brand name as an umbrella for a wider range of men's products. The line includes 14 items, notably pre- and after-shaves and a gel shaving cream. The most innovative product: a gel-based deodorant that will roll on using a patented, sieve like delivery system. Will it work? Many outsiders are sceptical, citing Gillette's sorry record in toiletries. Besides, competition has become very stiff in the once fragmented men's toiletries business. Procter & Gamble now owns Old Spice and Noxzema, Colgate bought Mennen, and Unilever grabbed Faberge's...
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...1 The Value of Synergy Aswath Damodaran Stern School of Business October 2005 2 The Value of Synergy Many acquisitions and some large strategic investments are often justified with the argument that they will create synergy. In this paper, we consider the various sources of synergy and categorize them into operating and financial synergies. We then examine how best to value synergy in any investment and how sensitive this value is to different assumptions. We also look at how this synergy value should be divided between the parties (or companies) involved in the investment. We conclude with an empirical examination of how much synergy is actually created in corporate mergers, and how much is paid. Synergy, we conclude, is so seldom delivered in acquisitions because it is incorrectly valued, inadequately planned for and much more difficult to create in practice than it is to compute on paper. 3 When Carly Fiorina argued for Hewlett-Packard’s acquisition of Compaq, she offered a number of of reasons the deal made sense. She noted that the combined company would be able to meet the demands of customers for “solutions capability on a truly global basis.” She also claimed that the firm would be able to lead with its products “from top to bottom, from low end to high end.” As her crowning argument, she claimed that the merger made sense because it would create “synergies that are compelling.” Synergy, the increase in value that is generated by combining two entities...
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... 5 MANUFACTURING, RAW MATERIALS, DISTRIBUTION, AND SUPPLIERS 10 CONSOLIDATION EFFORTS 10 RAW MATERIALS 11 DISTRIBUTION AND SUPPLIERS 12 SPECTRUM BRANDS FINANCES 12 SALES 12 INCOME 13 PROFITABILITY RATIOS 13 LIQUIDITY RATIOS 14 LEVERAGE RATIOS 15 ACTIVITY RATIO 16 SHARE PRICE 17 RECOMMENDATIONS 18 REFERENCES 19 INTRODUCTION Spectrum Brands (SPC) is a global branded consumer products company with seven major product lines including Rayovac consumer batteries, Tetra pet supplies, Remington electric shaving, grooming and personal care products, VARTA portable lighting, Vigoro lawn care, Sta-Green lawn and garden, Repel, Hot Shot, and Spectracide household insect control. After acquiring United Industries from Thomas H. Lee (THL) the Boston based private equity firm in 2005, Rayovac (ROV) changed its name to Spectrum Brands and started trading on the New York Stock Exchange (NYSE) as “SPC”. World Market The worldwide market sector in which Spectrum competes is estimated to be US$300 billion1. The worldwide market for batteries alone is estimated at US$50 Billion2. Worldwide dog and cat food sales stood at US$45.12 billion, a 4.9% increase over the previous year3. The market for grooming consumer product is about 16 billion4. Spectrum also competes in the $8 billion 5 consumer lawn and garden market. Corporate History Rayovac Corporation is the third leading U.S. manufacturer of alkaline storage batteries and the market...
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...billion distribution to shareholders. How do companies like ABN AMRO and Barclays determine whether a merger is a good idea? This chapter explores reasons that mergers should take place, and, just as important, reasons why they should not. There is no more dramatic or controversial activity in corporate finance than the acquisition of one firm by another or the merger of two firms. It is the stuff of headlines in the financial press, and it is occasionally an embarrassing source of scandal. The acquisition of one firm by another is, of course, an investment made under uncertainty, and the basic principles of valuation apply. One firm should acquire another only if doing so generates a positive net present value for the shareholders of the acquiring firm. However, because the NPV of an acquisition candidate can be difficult to determine, mergers and acquisitions, or M&A activities, are interesting topics in their own right. Some of the special problems that come up in this area of finance include the following: 1. The benefits from acquisitions can depend on such things as strategic fits. Strategic fits are difficult to define precisely, and it is not easy to estimate the value of strategic fits using discounted cash flow techniques. 2. There can be complex accounting, tax, and legal effects that must be taken into account when one firm...
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