Procter & Gamble Case Study

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Procter & Gamble
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ADMN 404: Assignment #2
Leah Cohen

EXECUTIVE SUMMARY

Procter & Gamble started in 1837 with William Procter and James Gamble coming together to make and sell candles and soaps. This simple business has since transformed into a global manufacturing, distribution and marketing company providing over 300 brands to consumers. Today, Procter & Gamble is the world’s biggest consumer products company with more than $80 billion in sales. It manufactures and produces a variety of products that feature a high standard of quality, practicality and value. Procter & Gamble operates by their mission to improve the lives of the world’s consumers every day, by touching lives in small but meaningful ways. Integrity, trust and respect for others are fundamental values that drive the day-to-day working methods and decision-making of P&G, and are enforced by a code of ethics that ensures a high standard of quality and morals. P&G enjoys the opportunities that are brought about by the eradication of trade barriers, improvements and developments in Internet and IT, as well as new, emerging and expanding markets and types of consumers. However, P&G must accept challenges in regards to product stagnation, unsafe product ingredients, a highly competitive landscape, strong buyer power and increasing raw material costs. Despite the challenges, P&G has a leading market position with a diversified product portfolio and a strong brand image. It has ample core strengths to offset the minimal weaknesses that the company faces. P&G knows how to properly leverage its core strengths to create consumer understanding, brand-building, innovation, market capability and scale, which has allowed P&G the opportunity to execute growth strategies in several areas. Given the new demand for natural products and the expanding market for male grooming and beauty products, P&G should aim to expand and build upon its Beauty Segment by creating a product line that is organic, pure and natural, and to accommodate the upward demand for beauty care products tailored towards the growing male market. As a vehicle for expanding the beauty segment, P&G can either spend a significant amount of money in R&D to develop such products, or they can acquire a company that is already established in that area. This would give the company some credibility in this segment, as well as save if from incurring substantial R&D and other start up expenses for the new segment. Finally, P&G can focus on targeting low-income consumers in both developed and emerging markets. This consumer group makes up a huge share of the world’s total population and with limited savings, they desire reputable brands that offer good, reliable quality at a fair price. P&G is in a perfect position to accept any of these strategic options and has the opportunity

Table of Contents
EXECUTIVE SUMMARY2
INTRODUCTION5
COMPANY OVERVIEW6
MANDATE7
EXTERNAL ANALYSIS8
INTERNAL ANALYSIS10
STRATEGIC OPTIONS12
Strategic Option #1:12
Strategic Option #2:14
Strategic Option #3:15
BIBLIOGRAPHY17

INTRODUCTION

The consumer goods industry is one that provides services primarily to customers, which can be divided into two categories: durable goods and nondurable goods. One of the biggest players in the consumer goods industry is Procter & Gamble. As such, this paper aims to make an analysis of the business strategies of Procter & Gamble, including its strengths and weaknesses as a company. It also aims to evaluate and assess the performance of the company and use the internal and external analysis to determine how its strengths and weaknesses can be used to support its opportunities and offset any potential threats. Furthermore, three distinct strategic options will be presented for P&G, with a balanced assessment of each strategy, in its efforts...
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