Questions On The Procter And Gamble Company

The company has been functioning well in terms of generating profit and demand so far. However, there will be a 20% increase in demand for the next month of operations as predicted by management, and the production and supply management's problems may come as a problem they can no longer afford.

Procter and Gamble Co. also know as P&G, is an American multinational consumer goods company, founded by William Procter and James Gamble. Its products include cleaning agents and personal care products. It has in its kitty global brands such as Ariel and Tide in the Fabric care segments and Head & Shoulder, Pantene and Rejoice is the Hair care segment. For this case study selects P&G Company as it has an important role in the consumer segment products. As P&G was a popular company, the financials statement shows better performance in the previous year.

Procter & Gamble Co is an American global consumer goods company. P&G have various products that range from personal hygiene products to household products.

The income over the last three years has been fluctuating.. This tells us the company has an initial growth period. Sales also drop between years 7 and 8 and the gross profit margin decreased as well. This may be due to operating expenses. This leads to the prospect of stable future sales. The stakeholders are continuing to back the company and the company does predict sales will remain stable. The modest increase in sales does not show enough to recover without making adjustments to free capital.

Allround brand it manages is of strategic importance to the company. Unfortunately, the fourth quarter performance were not as positive as management expected.

In addition, it owns and operates 93 manufacturing facilities in 45 other countries” (2). With such a huge, world-wide customer base, P & G has the challenge of meeting the needs of millions of people. To do so, the company has to constantly update its product line and expand is operations, increase it to answer new consumer demands. The question is then, is P & G capable of doing so?

Proctor and Gamble-Scope is faced with a very important decision, they need to prepare a marketing plan for P&G’s mouthwash business for the next three years. They want to know how they are going to be able to

Despite the inconsistent changes in spending from year to year, P&G’s market share consistently increased between 1% and 2% every twelve months (see Figure 1). The question is, with Unilever’s actions in regards to marketing expenditures, is the 15% increase going to be enough to restart P&G’s upward growth of market share?

Consequently P&G aimed to increase its innovative capacity and speed in order to accelerate global rollout of products and brands throughout new structures and policies. This was the main goal of Organization 2005:

The Procter & Gamble has vast differentiated products due to its innovation culture. This is not just the invention of new products and services, but the ability to systematically convert ideas into new offerings that alter the very context of the business (Charan, 2008). The product differentiation allows the P&G to charge premium price for its products and assists to capture market share from its rivals by increasing the product demand.

P&G need to work hard and do more research and development in order to produce higher quality, more innovative, and more unique in products in order to answer consumer’s need and compete with those major world brand competitors.

The company’s creams inventory remains constant because it does not follow a trend in innovation and changes so often as the other products. The surplus in inventory is a big disadvantage since; last year’s products may not be in style this year in addition to the cost of storage. For all these reasons their cash flow is less in comparison with previous years causing that Luxor Cosmetics keeps increasing their bank loans, creating more debt, making it harder to pay out as 2011. In this particular situation the company could have either decrease its budgeted sales (productions) or increase its actual sales by improving more effective marketing strategy and research and development of its products in the markets. This way their inventory would decrease and their cash flow would increase. (Hopkins, 2009)

P&G is now one of the ten most valuable companies in the United States. During Mr. Lafley’s watch since the year 2000, sales have grown to more than $80B in 2008, from less than $40B when he took over, and earnings have tripled, topping $10B in 2007. The company has 24 brands generating more than $1B each, more than twice the number in 2000. And that number is likely to increase with close to 20 more brands with sales greater than $500M and growing. P&G’s stock, which was trading at about $28 per share when Mr. Lafley took over, now exceeds $70.

As a large global company, P&G has strengths that have helped them to acquire such a vast market share. The company’s culture, strong product quality, the ability to understand customers, brand equity, and centralized management is at the

Proctor and Gamble recently completed large restructuring, put new management in place, and cut capital spending needs. Since then they are now focused on increasing top and bottom line results after shifting business mix toward higher margin, less capital-intensive health and beauty care sectors and also gearing towards developing markets and lower-income consumers.