Procter &Gamble Case Analysis Essay

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Industry Environment Analysis: consumer goods - The consumer goods' is a global and mature industry. - Highly competitive with an increasing number of competitors offering different versions of the same product and competing for price. Generic brands and Private-label goods are populating the market. - Product innovation and quality are critical to succeed. - Individual buyers have no bargain power. Instead, large retail chains and major supermarkets increase competition among consumer goods' manufacturers. Switching costs are low or in most cases null. Position of the company in the Industry: P&G has a global leader position in the consumer goods industry with many well known premium products in its portfolio like: -…show more content…
1999 2000 2001 Net Sales (U$ Billions) 38.1 40 39.2 Net Sales Variation (U$ Billions) 5% -2% Net Earnings (U$ Billions) 2.59 2.47 2.07 Net Earnings (U$ Billions) -5% -16% The most relevant event in the company's finances was in 2000 when Its EPS were reduced by almost 50 % (from $117 to $60). SWOT Analysis Strengths: - Global leading position in the consumer goods industry. - "Star brands" in most of its business segments - Multicultural and decentralized managerial team. - The strong and decentralized IT department provides collaborative technology to support key strategy-activities like planning and marketing, business-to-consumer, e-commerce and R&D in every business unit of the company. - Core competencies in R&D and Marketing. Weakness: - P&G star products are mature and had been for a long time in the market. - The first period of the Organization 2005 project dropped the company to its lowest levels in stock price and earnings, weakening the company's competitiveness and profitability. High costs of the Organization 2005 project implementation 1.9 billion in costs. Opportunities: - Procter & Gamble has opportunities in two business segments. The Health Care and the Beauty Care segments have the highest growing levels during 2002 (34% and 22%). Notice, that the Beauty Care this segment is already one of the sales leader businesses. Threats: -
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