Mg 495 Week 3 Case Study
Case 35 – Church & Dwight: Time to Rethink the Portfolio?
A case report prepared for MG 495 Business Policy
(Spring II Term)
Michael XXXXXXXXXX April 8, 2012
1
CASE 35 – CHURCH & DWIGHT: TIME TO RETHINK THE PORTFOLIO? I. INTRODUCTION A. EXECUTIVE SUMMARY 1. Summary statement of the problem: Church & Dwight, more commonly known by its brand name “Arm & Hammer,” has held a commanding lead in the sodium bicarbonate product market for over 160 years with virtually 99 percent of all consumer products in households within the United States. However, in order to promote growth and diversity while maintaining a steady profitability rate of 3-5 percent per year, the company has expanded uses of sodium bicarbonate products so that it is no longer the sole focus. In fact, the acquisition of a diverse group of consumer products in international markets has been viewed as a viable option to sustain the profitability margins well into the 21st century. (Wheelen & Hunger, p. 35-12, 2012). 2. Summary statement of the recommended solution: The relatively small company, as compared to competitors in household and personal care product markets must recognize the challenges of growing sales through acquisitions to promote growth and competitiveness within those markets, Church & Dwight must incorporate additional acquisitions of solid brands and products in order to grow market share through an expansion of product lines into a variety of “personal care, deodorizing and cleaning, and laundry products” as well as “specialty chemicals, animal nutrition, and specialty cleaners” (Wheelen & Hunger, p. 35-6, 2012). In addition, to maintain its position in the world market place, Church & Dwight must expand into international markets and gain footholds in product markets through acquisition of
2
manufacturing assets. Simply shipping domestic product lines overseas is costprohibitive and foreign manufacturing assets will allow product recognition by local consumers in
A case report prepared for MG 495 Business Policy
(Spring II Term)
Michael XXXXXXXXXX April 8, 2012
1
CASE 35 – CHURCH & DWIGHT: TIME TO RETHINK THE PORTFOLIO? I. INTRODUCTION A. EXECUTIVE SUMMARY 1. Summary statement of the problem: Church & Dwight, more commonly known by its brand name “Arm & Hammer,” has held a commanding lead in the sodium bicarbonate product market for over 160 years with virtually 99 percent of all consumer products in households within the United States. However, in order to promote growth and diversity while maintaining a steady profitability rate of 3-5 percent per year, the company has expanded uses of sodium bicarbonate products so that it is no longer the sole focus. In fact, the acquisition of a diverse group of consumer products in international markets has been viewed as a viable option to sustain the profitability margins well into the 21st century. (Wheelen & Hunger, p. 35-12, 2012). 2. Summary statement of the recommended solution: The relatively small company, as compared to competitors in household and personal care product markets must recognize the challenges of growing sales through acquisitions to promote growth and competitiveness within those markets, Church & Dwight must incorporate additional acquisitions of solid brands and products in order to grow market share through an expansion of product lines into a variety of “personal care, deodorizing and cleaning, and laundry products” as well as “specialty chemicals, animal nutrition, and specialty cleaners” (Wheelen & Hunger, p. 35-6, 2012). In addition, to maintain its position in the world market place, Church & Dwight must expand into international markets and gain footholds in product markets through acquisition of
2
manufacturing assets. Simply shipping domestic product lines overseas is costprohibitive and foreign manufacturing assets will allow product recognition by local consumers in
Cited: Church & Dwight, Co. Inc. (web). Churchdwight.com. Retrieved on April 8, 2012 from http://www.churchdwight.com/index.aspx Craigie, J. R. (February 24, 2010). Church & dwight co., inc. 2009 annual report: Churchdwight.com. Retrieved on April 8, 2012 from http://www.churchdwight.com/PDF/AnnualReports/2009-CDH-Annual-Report.pdf Wheelen, T. L., & Hunger, J. D. (2012). Strategic management and business policy toward global sustainability. (13th ed., pp. 19-20). New York, NY: Pearson Hall. 19