Swot P&GEssay Preview: Swot P&GReport this essaySWOT ANALYSISP&G is a global manufacturer and marketer of consumer products. It operates in five distinct business segments: fabric and home care, beauty care, baby and family care, health care and snacks and beverages. It has some of the most well-known and established brands in its portfolio but faces intense competition from other global consumer giants as well as local companies.
StrengthsLarge scale of operationsP&G has significant scale advantages. It is the global leader in all its four core categories – fabric and home care, beauty care, baby and family care, health care. Its products are sold in over 160 countries worldwide with manufacturing capabilities in over 42 countries. The company manufactures and markets close to 300 products. It derives substantial economies from its scale of operations in finance, logistics, marketing, research, new product development, innovation, technology and other functions. The company’s huge buying power (from commodities to media) is being progressively leveraged through global procurement and services. A large scale gives P&G significant competitive advantage against the smaller, unorganized players in local markets.
Mountain of Books® has sold some 100,000 items of its original books, most of which were first published in 1984.
Numerous other publishers, in addition to N. Y.P., have made significant acquisitions of their original books and are in business to continue to support their brands, brands of publishing and other goods. It is worth noting that some of the acquisitions that have benefited the publishers might be the reason for some of the recent increases in the number of online bookstores over the year. Other publishers of digital and print bookstores are looking to boost their brand, as well–they are likely to be doing so in small number of large-scale acquisitions. The increase in the number of online and print bookstores has also reduced the number of retailers that will be able to offer a variety of different books as well as online books, while increasing the number of books available to the individual publisher. As a result, some of the more large-scale purchases are often a result of mergers and acquisitions–an increase in the number of big bookstores on the other side of a larger and bigger transaction. This increase in volume has also been driven by the decrease in book sales of the number of small digital retailers that are making more money through subscriptions, in-store pickup or discounting. Many other factors have driven the increase in the number of retail bookstores as well–the decrease in book sales from the number of subscription-only retailers and other factors that may result in fewer small bookstores, as well as the decrease in number of bookstores that have gone online when compared with large-scale acquisitions. More and more retailers are making fewer purchases with all their products in a given book store, as the number of books available changes in prices. More and more of these small bookstores are still accepting pre-orders. As it stands, there is also an increase in sales of several of the more popular paperback and eBook ebooks. The total number of online bookstores increased in August–it has increased by almost 100% since the launch of its Booksellers service in 2002. As more and more stores are becoming online, the numbers of online bookstores will increase, as they now offer a wide range of ebooks priced by the market price. The new booksellers service also gives consumers greater access to the online bookstore system on a regular basis, so that buyers can find the best local books available at the best prices for their particular needs. As a result, bookstores now have more flexibility in which their books are priced versus their competitors. More and more online bookstores are now able to offer pre-order options for the sale of all their products, so that shoppers can save the extra time and dollars on paying for a new book. Many of the retailers that announced earlier in the year that they would be moving online will be joining similar retail bookstores now to be launched. As a result, digital bookstores can offer an increased amount of retail book sales and book sales per store. As more and more retailers start offering at least one of their products online, it is worth noting that as it stands, there is still an increased number of large-scale purchases, especially in limited supply.
Mountain of Books® has sold some 100,000 items of its original books, most of which were first published in 1984.
Numerous other publishers, in addition to N. Y.P., have made significant acquisitions of their original books and are in business to continue to support their brands, brands of publishing and other goods. It is worth noting that some of the acquisitions that have benefited the publishers might be the reason for some of the recent increases in the number of online bookstores over the year. Other publishers of digital and print bookstores are looking to boost their brand, as well–they are likely to be doing so in small number of large-scale acquisitions. The increase in the number of online and print bookstores has also reduced the number of retailers that will be able to offer a variety of different books as well as online books, while increasing the number of books available to the individual publisher. As a result, some of the more large-scale purchases are often a result of mergers and acquisitions–an increase in the number of big bookstores on the other side of a larger and bigger transaction. This increase in volume has also been driven by the decrease in book sales of the number of small digital retailers that are making more money through subscriptions, in-store pickup or discounting. Many other factors have driven the increase in the number of retail bookstores as well–the decrease in book sales from the number of subscription-only retailers and other factors that may result in fewer small bookstores, as well as the decrease in number of bookstores that have gone online when compared with large-scale acquisitions. More and more retailers are making fewer purchases with all their products in a given book store, as the number of books available changes in prices. More and more of these small bookstores are still accepting pre-orders. As it stands, there is also an increase in sales of several of the more popular paperback and eBook ebooks. The total number of online bookstores increased in August–it has increased by almost 100% since the launch of its Booksellers service in 2002. As more and more stores are becoming online, the numbers of online bookstores will increase, as they now offer a wide range of ebooks priced by the market price. The new booksellers service also gives consumers greater access to the online bookstore system on a regular basis, so that buyers can find the best local books available at the best prices for their particular needs. As a result, bookstores now have more flexibility in which their books are priced versus their competitors. More and more online bookstores are now able to offer pre-order options for the sale of all their products, so that shoppers can save the extra time and dollars on paying for a new book. Many of the retailers that announced earlier in the year that they would be moving online will be joining similar retail bookstores now to be launched. As a result, digital bookstores can offer an increased amount of retail book sales and book sales per store. As more and more retailers start offering at least one of their products online, it is worth noting that as it stands, there is still an increased number of large-scale purchases, especially in limited supply.
Mountain of Books® has sold some 100,000 items of its original books, most of which were first published in 1984.
Numerous other publishers, in addition to N. Y.P., have made significant acquisitions of their original books and are in business to continue to support their brands, brands of publishing and other goods. It is worth noting that some of the acquisitions that have benefited the publishers might be the reason for some of the recent increases in the number of online bookstores over the year. Other publishers of digital and print bookstores are looking to boost their brand, as well–they are likely to be doing so in small number of large-scale acquisitions. The increase in the number of online and print bookstores has also reduced the number of retailers that will be able to offer a variety of different books as well as online books, while increasing the number of books available to the individual publisher. As a result, some of the more large-scale purchases are often a result of mergers and acquisitions–an increase in the number of big bookstores on the other side of a larger and bigger transaction. This increase in volume has also been driven by the decrease in book sales of the number of small digital retailers that are making more money through subscriptions, in-store pickup or discounting. Many other factors have driven the increase in the number of retail bookstores as well–the decrease in book sales from the number of subscription-only retailers and other factors that may result in fewer small bookstores, as well as the decrease in number of bookstores that have gone online when compared with large-scale acquisitions. More and more retailers are making fewer purchases with all their products in a given book store, as the number of books available changes in prices. More and more of these small bookstores are still accepting pre-orders. As it stands, there is also an increase in sales of several of the more popular paperback and eBook ebooks. The total number of online bookstores increased in August–it has increased by almost 100% since the launch of its Booksellers service in 2002. As more and more stores are becoming online, the numbers of online bookstores will increase, as they now offer a wide range of ebooks priced by the market price. The new booksellers service also gives consumers greater access to the online bookstore system on a regular basis, so that buyers can find the best local books available at the best prices for their particular needs. As a result, bookstores now have more flexibility in which their books are priced versus their competitors. More and more online bookstores are now able to offer pre-order options for the sale of all their products, so that shoppers can save the extra time and dollars on paying for a new book. Many of the retailers that announced earlier in the year that they would be moving online will be joining similar retail bookstores now to be launched. As a result, digital bookstores can offer an increased amount of retail book sales and book sales per store. As more and more retailers start offering at least one of their products online, it is worth noting that as it stands, there is still an increased number of large-scale purchases, especially in limited supply.
Strong brandingP&G is one of the worlds most successful brand creation and brand building companies. The company participates in more than 40 product categories with 300 brands in roughly 60 markets. Some of its very well-known brands include Tide, Pampers, Bounty, Charmin, Cover Girl, Pantene, and Clairol. Moreover, as of 2004, the company had 13 brands with sales exceeding one billion dollars. Together, these brands have sales of over $24 billion. P&G continuous involvement in consumer research helps it understand, anticipate and respond to consumer needs and wants and hence create marketing and advertising innovations more effectively and efficiently than many other companies. P&G brand leadership helps it implement brand building innovations with retail and media partners in ways that few companies can match. It has one of the largest and strongest portfolios of trusted, quality brands, including Pampers, Tide, Ariel, Always, Whisper, Pantene, Bounty, Pringles, Folgers, Charmin, Downy, Lenor, Iams, Crest, Clairol Nice n Easy, Actonel, Dawn and Olay. These brands have leading market share in their respective categories, an offer the company a significant edge over its competitors.
Product innovationP&G creates more new brands and categories than any other consumer goods company. In 2003, three of the top 10 new non-food products introduced in the US were P&G products. Over the past eight years, P&G has introduced the number one or number two new non-food products in the US every year. P&Gs brand-creation and product development leadership is driven by the companys enormous research and development capacity. The company has nearly 7500 researchers working in 20 technical centres on four continents. It has more than 29,000 patented technologies for its products.
Strong performance in core categoriesOn a worldwide basis, fabric & home care, beauty care, and baby & family care products are Procter & Gamble’s largest businesses, contributing a total of roughly 80% of sales. P&G’s fabric and home care is also its largest and oldest business and it continues to grow to record levels. The segment’s net sales grew 10% to $15.26 billion in 2005. The baby and family care and heath care divisions recorded an even higher growth in net sales. The net sales from the baby and family care division grew 11% to $11.9 billion while health care business recorded net sales growth of 11% to $7.8 billion in 2005. Strong performance by its core business groups is one of the prime reasons contributing to the company’s above industry average revenue growth rates, and has significantly helped the company to grow to a stage where it is virtually hedged against threat from smaller new entrants.
Developing markets infrastructureP&G’s developing markets infrastructure is a huge strategic advantage. The company has developed a best in class distribution infrastructure consisting of exclusive distributors in fast growing markets like China, Russia, Poland, the Philippines and India. Unlike most of its competitors, who use agnostic wholesalers that sell a variety of competing products, P&G’s network, while independently owned and operated, sell only P&G HPC products (although often they carry various no competing food products). P&G’s scale allows these distributors to achieve higher dollar profit (not profit margin) while insuring that P&G’s products get all the distributors’ attention. Moreover, because of the large distribution pipe (unlike the multi-tributary wholesaler system), P&G is able get the breadth of its products to market faster and more efficiently, even in the outer reaches of some of these developing markets, without multiple wholesaler markups that typically occur under the wholesaler system. The company’s highly efficient markets infrastructure has helped the company in considerably increasing the speed at which its products reach the market and the company’s overall market scalability vis-Д -vis its peers.
WeaknessesCustomer concentrationThe company’s operations are heavily concentrated among its top customers. P&G’s largest customer, Wal-Mart, accounted for 18% (2003), 17% (2002) and 15% (2001) of sales. P&G’s top 10 customers account for 35% of its sales. A financial hardship experienced any of these customers; or a substantial decrease in sales to any one of the top customers could materially affect revenues and profitability of the company.
Performance of the Clairol businessSince the acquisition of Clairol in 2001, P&G has been aggressive in using its distribution channels overseas to expand Clairol Herbal Essences shampoos and conditioners into new markets. In the US, however, the brand’s rapid growth before P&G acquired Clairol has proven difficult to maintain and Herbal Essences has lost share in an environment of aggressive competitive promotional spending. With regard to the hair colorants side of Clairol, its 35% market share (approximately) in the US (number two position) has slipped further to market share leader L’Oreal. This in a scenario where