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Presentation On P&G

Presented By:

Usman Rehmani


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Usman Rehmani


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VISION

STATEMENT

Be, and berecognized

as, the bestconsumerproducts and

services

company inthe world.

Usman Rehmani


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MISSION

STATEMENTWe will provide products andservices of superior quality andvalue that improve the lives of theworld's consumers. As a result,

consumers will reward us withleadership sales, profit and valuecreation, allowing our people, ourshareholders, and the communitiesin which we live and work to

prosper. We will provide brandedproducts and services of superiorquality and value that improve thelives of the world's consumers, nowand for generations to come.


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RECOMMENDED

VISION & MISSIONVISION

P&Gs intent is to offer the highest quality consumerproduct goods at the least expensive price for thewidest spectrum of customers in a convenient format.

MISSIONcoca-cola will work with its suppliers and distributorsto ensure that its products are recognized both in themarket and on the supply side as contributory to aretail distributors bottom line.


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VALUES Integrity

Passion for Winning

Leadership

Trust

Ownership


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PRINCIPLES We Are Strategically Focused in Our

Work.

We Value Personal Mastery. We Seek to Be the Best.

The Interests of the Company and theIndividual Are Inseparable.

We Are Externally Focused. Mutual Interdependency is a Way of

Life


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OBJECTIVES To build existing core businesses into stronger

global leaders.

To grow leading brands in big countries, winningcustomers.

To develop fast-growing, higher-margin withglobal leadership potential.

To regain growth momentum rate and leadershipin Western Europe.

To drive growth in key developing markets.


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COMPANY OVERVIEW & HISTORYProcter and Gamble is actually thename of two persons William

Procter and James Gambleimmigrants from England & Irelandrespectively.

Procters business was candle

making and Gambles business wassoap making.


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The partnership year 1837 was adifficult time to start the business

although Cincinnati was a bustlingmarket place; the nation was

gripped by financial panic.

Hundreds of banks were closing

around the country.


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In the 1850s despite rumors of an

impending civil war in the US, theybuilt a new plant to sustain their

growing business.


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In 1859 sales reached one milliondollars. By this point only eight

employees were working with

Procter and Gamble, the company

won contracts to supply the Union

Army with soaps and candles.


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In 1880s coca-colabegan to marketa new product, an inexpensive

soap that floats in water, thecompany called the soap Ivory.


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By 1890, the fledgling partnership

between the Procter and Gamble

had grown into multimillion dollar

corporation. In 1939, Television was

introduced in USA and coca-cola was

the only company thatcommercialized its product just after

five months.


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In 1980, as it approached its 150th

anniversary, coca-cola was poised

for a most dramatic period of

growth in its history.In 1915 coca-cola started business

outside USA in Canada.

Company serves 106000

employees all over the world.


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History Of coca-cola In Pakistan

coca-cola Pakistan, headquartered in Karachi,commenced operations in Pakistan in 1991.

In 1994 coca-cola acquired a soap-manufacturing

facility Hub, Baluchistan. In 2004, a PUR facility was set up to produce P&Gs

water purifying technology.

Today, the Hub plant is equipped with state-of-the-artmanufacturing technologies and quality assuranceprocesses and systems, reflecting the company's valuesof safe, hygienic and ethical manufacturing practices.


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DISTRIBUTION CHANNEL coca-cola itself has no distribution channel rather they

were initially distributing its products through

International Brands Limited (IBL). In the 1940s, Abudawood became the exclusive

distributor of coca-cola(coca-cola) brands throughoutSaudi Arabia.

In 1956, Abudawood and coca-cola established a joint-venture factory in Saudi Arabia (called ModernIndustries Inc.). In the same year Abudawood starteddistribution of coca-cola products in Pakistan.


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SOCIAL RESPONSIBILITY

Pampers Hospital Education Program

Safeguard School Education Program


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SUSTAINABILITY AT coca-cola


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FINANCIAL ANALYSIS


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Balance Sheet 2010

During the previous 3 years P&Gs assets have

diminished by 10%.

While long term debt has been constant short term

debt has decreased by 48%.

coca-cola has an extremely low ratio of tangible assets

to intangible assets.


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June 2008 June 2009 June 2010

Total Assets 143992.00 134833.00 128172.00

Total Liabilities 74498.00 71734.00 67057.00

Total Equity 69494.00 63099.00 61115.00

Short Term Debt 13084.00 16320.00 8472.00

Long Term Debt 23581.00 20652.00 21360.00

Current Assets 24515.00 21905.00 18782.00

Intangible Assets 98837.00 93466.00 90146.00


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ANALYSIS OF THE

EXTERNAL

ENVIRONMENT


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Porters Five Forces


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Continued.. faces very strong buyers power because retailers like

Wal-Mart are able to negotiate for pricing with

companies. limited supplier power because of the costs they incur

when switching suppliers.

low threat of new entrants because a huge capital

amount is required. high threat of substitutes.

high level of rivalry exists among existing firms.


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PEST ANALYSIS

Usman Rehmani


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SWOT ANALYSIS (Opportunities

and Threats)

Usman Rehmani


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Opportunities

Developing markets. Niche markets.

New products.

To invest in the segment forchildren.

To introduce food and beveragesfor Pakistani market.

Emerging consumer market(China& India).

Manufacturing facilities inChina.

Selling through internet.


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Threats

Uncertainty inpharmaceuticals business.

Increase in prices of raw

materials. Unilever is the biggestthreat.

Price competition aroundthe world.

Political disruption.


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COMPETITORS

Usman Rehmani


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coca-cola Kimberly-

Clark

Johnson &

Johnson

Critical Success

Factors

Weight Rating Score Rating Score Rating Score

Advertising 0.20 4 0.80 1 0.20 3 0.60

Product Quality 0.10 4 0.40 4 0.40 3 0.30

Price Competitiveness 0.10 3 0.30 3 0.30 4 0.40

Management 0.10 3 0.30 4 0.40 3 0.30

Financial Position 0.15 3 0.45 4 0.60 3 0.45

Customer Loyalty 0.10 4 0.40 4 0.40 2 0.20

Global Expansion 0.20 2 0.40 4 0.80 2 0.40

Market Share 0.05 4 0.20 1 0.05 3 0.15

Total 1.00 3.25 3.15 2.80

CPM

EFE M t i


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Key External Factors Weight Rating Weighted

Score

Opportunities

1. Global markets are a significant growth

market

0.15 1 0.15

1. Increased demand due to new health and

beauty needs.

0.05 4 0.20

1. Internet advertising growth. 0.05 1 0.051. coca-cola is a category killer. 0.14 4 0.60

1. Increasingly health conscious public. 0.10 3 0.30

Threats

1. Economic downturn. 0.10 3 0.30

1. Increased competition from rivals. 0.05 3 0.15

1. Lack of product acceptance. 0.05 2 0.10

1. Poor media exposure for new products. 0.10 4 0.40

1. High core commodity prices affecting

product cost.

0.20 1 0.20

Total 1.00 2.45

EFE Matrix


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ANALYSIS OF THE

INTERNALENVIRONMENT


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SWOT ANALYSIS (Strengths and Weaknesses)


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Strengths

large scale operations.

very strong brand name and leading market position.

coca-cola has a huge customer base.

innovations to sustain its customer base.

Diversified product portfolio.

Strong focus on research & development.

Strong global presence (160countries).


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Core StrengthsCoca-cola focuses on five core strengths required to

win

in the consumer products industry.


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Weaknesses

less innovative than its major competitor Unilever. products have failed in certain geographic areas. Forexample, Oil of Olay failed in Pakistan, Camay failedhere as well.

Dependent on Wal-Mart stores for majority of itsrevenue.

Production facilities in 43 countries while operationsin more than 160 countries.

IFE M t i


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Key Internal Factors Weight Rating Weighted

Score

Internal Strengths1. Largest home consumer product goods manufacturer. 0.05 4 0.20

1. Innovative products format. 0.10 4 0.40

1. Increasing free cash flows. 0.05 3 0.15

1. Career development program. 0.15 4 0.60

1. Strong management team. 0.05 3 0.151. Strong logistics supply chains. 0.05 3 0.15

1. Discount pricing structures. 0.05 3 0.15

1. Long-range planning. 0.05 4 0.20

1. Reputation for quality. 0.05 3 0.15

1. Outperforming financial ratios 0.05 3 0.15Internal Weaknesses

1. Many products are not personal care necessity. 0.04 2 0.08

1. Little unified brand focus. 0.05 2 0.10

1. Narrow margins. 0.05 2 0.10

1. High operating costs. 0.11 1 0.111. Uncertain oint marketin ventures. 0.10 1 0.10

IFE Matrix

TOWS MATRIX


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TOWS MATRIXS- Strengths Innovative products.

Professional management.

Diverse product lineup.

Plans for acquisitions.

W- Weaknesses Lack of direct marketing.

Lack of new media

marketing channels.

Dependence on few major

product categories.

O- Opportunities Expanding marketing

strategies.

Undifferentiated rival products.

Consumer demand.

Niche markets.

S-O Strategies

Develop new products to target niche

markets.

Utilize managerial competencies for

aggressive marketing strategy to

attain competitive advantage.

Continue diversification to fulfill

consumers demand.

W-O Strategies

More focused marketing

strategy.

Liaison with good

distributors to increase

online sales.

Utilize niche markets rather

to depend upon few product

categories.

T- Threats Price competition.

Regulations.

Rival competitors.

S-T Strategies

Utilize buying volume to put pressure

on competitors.

Continue product diversification to

offset increased chances of

competitor entry.

W-T Strategies

Develop good partnership

with internet consumer

product goods distributors

to increase sales.

SPACE Matri


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Financial Strength Ratings

The companys original capital ratio is 7.23 percent which is 1.23 percentage points

over the generally required ratio of 6.

P&Gs return on assets is negative 8.7 compared to industry average of positive 8.0.

The companys net income is continually expanding.

The companys revenue increased 14 percent.

1.0

1.0

3.04.0

9.0

Industry Strength Ratings

Increasing market share provides geographic and product freedom.

More competition in global markets.

Kimberly-Clark provides a strong industry benchmark.

4.0

2.04.0

10.0

Environmental Stability Ratings

High inflation rate in developing countries and political instability are big

hurdles for international business growth.

Merger and acquisitions are also difficult due to credit markets. coca-cola get more of its revenue fr0m US market.

-4.0

-4.0

-5.0-13.0

Competitive Advantage Ratings

coca-cola focused on home consumer product goods for health and beauty.

coca-cola is a recognized category killer.

In addition of Kimberly-Clark, Johnson & Johnson is a trouble creating

competitor.

-2.0

-5.0

-2.0

-9.0

SPACE Matrix


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Conclusion: ES average is -13.0 3= -4.33

IS average is +10.0 3= +3.33

CA average is -9.0 3= -3.00

FS average is +9.0 4= +2.25

Directional vector coordinates:

x-axis: -3.00 + (13.33) = 0.33

y-axis: -4.33 + (12.25) = -2.08

Outcome:

coca-colashould pursue Competitive Strategies.

QSPM Chart


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QUANTITATIVE STRATEGIC PLANNING MATRIXStrategic Alternatives

Key Factors Weight Joint Ventures in

Europe

Joint Ventures in

Asia

Opportunities AS TAS AS TAS

1. Europe is a potential growth market. 0.10 4 0.40 2 0.20

1. The US market continues to develop

new product categories.

0.15 4 0.60 3 0.45

1. Free market economies increasing in

Asia.

0.10 2 0.20 4 0.40

1. Demand for health & beauty products

is increasing.

0.05 - - - -

Q

Threats

1. Competitor threats such as Kimberly-Clark. 0.10 3 0.30 4 0.40

1. Economic contraction in its main US market. 0.05 - - - -

1. Lack of defining product to attract continued

foot-traffic in the companys retail

distributors.

0.10 4 0.40 1 0.10

1. Environmental issues with some home

consumer product goods products.

0.05 - - - -

1. Low value of US dollar abroad. 0.15 4 0.60 2 0.30

St th


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Strengths1. Profits rose 0.10 4 0.40 2 0.20

1. Strong management team 0.10 - - - -

1. New employee development programs. 0.10 4 0.40 2 0.20

1. Diversified product portfolio. 0.05 4 0.20 3 0.15

1. Performance driven management. 0.05 - - - -

1. Capacity utilization increased from 60%

to 80% for all manufacturing facilities.

0.15 3 0.45 4 0.60

Weaknesses1. Johnson & Johnsons troubles could be

contagious.

0.05 - - - -

1. Restructuring costs could be significant if

the market requires.

0.05 - - - -

1. International expansion suffers. 0.15 2 0.30 4 0.60

1. The company is slow in leveraging its

global operations due to current economic

conditions.

0.15 4 0.60 3 0.45

1. Pre-tax profit margins are narrow.

0.05

-

-

-

-

Sum of Total Attractiveness Score 1.0 5.30 4.65


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INTERNAL-EXTERNAL (IE) MATRIX

BOSTON CONSULTANT GROUP MATRIX


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BOSTON CONSULTANT GROUP MATRIX


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CONCLUSION

coca-colais the worlds largest producer of householdand personal products by revenue with net sales of$83503 million with its products reaching 4 billionpeople worldwide.

Being in more competitive position coca-cola mustcontinue to scan the environment for possible threats,whether through acquisition or Greenfieldinvestments.

coca-cola must continue to innovate becauseeconomies of scales allow coca-cola to spend muchmore than rivals on research and development.


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coca-cola will also have to control its pricing and

reduce outside vendors.

coca-cola will want to continue its strong support and

funding of its world class research and development

in order to continue to provide innovative products to

touch the lives of customers worldwide.


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RECOMMENDATIONS coca-cola may have a series of strategies which can be

more attractive to the company. Such series of

alternatives may not result in an alternative internal

rate of return (IRR) relative to the cost of the

strategies. Hence, in such time of economic pressure

it is recommended to do nothing and continuebusiness as usual and even avoid organic expansion

also.


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Another recommendation is to expand organically.

coca-cola has access to a greater number of developedand developing markets.

The company has also product co-branding

opportunities because of its size and volume of sales.

Thus, coca-cola can opt to expand through organic

growth by establishing another brand category that

will target specifically the UK and European markets

to increase companys continued growth.


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Third suggestion is about acquisition that the company can

acquire its primary competitor. Through such acquisition the

established company can gain immediate sales capacity and

market position without investing in substantial marketing

effort.

New products must be introduced which must be appropriately

positioned relative to its competitors but this would involve

thousands of dollars in terms of marketing.

Usman Rehmani

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