Church and Dwight Case Analysis

Only available on StudyMode
  • Download(s) : 1198
  • Published : April 24, 2013
Open Document
Text Preview
Church and Dwight
Case Analysis

  Church & Dwight Co., Inc., founded in 1846, is the world's leading producer of sodium bicarbonate, popularly known as baking soda, a natural product which cleans, deodorizes leavens and buffers. The Company's Arm & Hammer brand is one of the nation's most trusted trademarks for numerous consumer and specialty products. The company has multiple plants in United States and Brazil from where they export their product. Their subsidiary in Brazil also manufactures various inorganic chemicals, such as sodium sulfide, sodium sulfite, sodium metabisulfite, barium carbonate, barium sulfate and barium chloride. Church & Dwight consumer products can be broken into four categories: deodorizing and household cleaning, laundry, personal care and international. Over half of their domestic products are sold under the Arm & Hammer brand name, which includes toothpaste, laundry detergent, and pet products.         

Church and Dwight can attribute much of its success to the fact that it has concentrated on the production and sales of sodium bicarbonate. Strong family control has shielded management from the problems of defending the company from takeover attempts. The company has successfully taken a commodity chemical, branded it, and marketed it to the point where it dominates the market. It has subsequently capitalized on consumer recognition and loyalty to the ARM & HAMMER brand by introducing multiple consumer products under this logo. As the dominant producer and marketer of sodium bicarbonate products, Church & Dwight has faced limited competition in its primary markets and successfully entered the markets with other consumer products using a low price strategy with limited advertising expenditures. Recent acquisitions now present the company with new challenges as it faces major competition in the consumer products markets both domestically and internationally.

Strenght
.Over 150 years of experience as a sodium bicarbonate producer and marketer. * Almost 25 percent of the outstanding shares of common stock are owned by descendants of the company's cofounders. * Company controls approximately 75 percent of the sodium bicarbonate production in the United States and is also the only producer of ammonium bicarbonate and potassium carbonate. * Company controls 85 percent of the baking soda market.

* Extensive consumer brand name recognition and loyalty (in 95 percent of U.S. households), which allows the company to promote multiple products using a single brand name. * Anti-takeover defenses including a board of directors with staggered terms of office and voting rights that are weighted in favor of long-term shareholders. * Controlling the production of raw materials, the manufacturing and processing facilities, and the primary marketing functions allows the company to price its products below those of competitors - thus creating a barrier to entry. * Ability to build value by effectively implementing cost savings strategies when acquiring other company’s consumer brands. Weaknesses

* Company's lack of financial strength as balance sheet has been strained through a series of acquisitions and international marketing and management expertise is hampering expansion outside of North America. * Primary focus on the Arm & Hammer brand name has left the company with a void in product promotion experience that may be needed in the highly competitive consumer products field or international expansion. * Inability to determine the strategic fit of Specialty Products Division into overall company operations. * Lack of financial strength to launch aggressive marketing campaigns for new products. * Top management turnover.

Opportunities

• Potential expansion into international markets.

• Expanded uses of company's basic raw materials for pollution control and potable water applications as stricter environmental legislation is...
tracking img