PREPA

RED BY

:

MOHAMAD KAMAL B

IN YA

HAYA

2010117355

NOORHIDAY

AH BIN

TI A

BDUL RAHIM

2010908913

NUR HAMIZ

AH BIN

TI Z

AKARIA

2010513041

SITI M

AZIRA B

INTI

AHMAD

2010350649

PREPA

RED FOR :

MISS N

URUL SYA

ZWANI B

INTI

MOHAMAD S

AID

P&G focus on providing consumer packaged goods

Founded in 1837 by William Procter and James Gamble.

Operates in over 180 countries today primarily through mass merchandisers, grocery stores, membership club stores, drug stores and high-frequency stores.

P&G is organized 3 Global Business Units:

1) Beauty and Grooming,

2) Health and Well-Being and

3) Household Care

““We will provide branded products and We will provide branded products and services of superior quality and value services of superior quality and value that improve the lives of the world’s that improve the lives of the world’s consumers, now and for generations to consumers, now and for generations to come. As a result, consumers will reward come. As a result, consumers will reward us with leadership sales, profit and value us with leadership sales, profit and value creation, allowing our people, our people, creation, allowing our people, our people, our shareholders, and the communities our shareholders, and the communities in which we live and work to prosper.”in which we live and work to prosper.”

   

STRATEGY ANALYSIS

STRENGHTS

1.Diverse range of business segments

2.Large amount of customer based.

3.Most products are not highly seasonal

WEAKNESSES

1.Price paid for commodities for the products subject to fluctuation

2.Previous CEO has focused the strategy on innovation without concern the customer demands

OPPORTUNITIES

1.Research and development efforts to develop technology

2.Capturing market share from competitors through advertising

3.Accelerate its growth in developing markets such as Brazil and India

THREATS

1.A material change in consumer demand or products could have a significant impact on business

2.Business is subject to legislation, regulation as well as enforcement in the U.S and abroad

BACKGROUND OF COMPANY

• SO Customer in developing market Brazil and India have the chance to use P&G

products (S2, O3)

• WO• P&G products can get into Brazil and India markets as there are customer

demand.(W2, O3)

• ST• Increase the number of products that can meet the consumer demands (S3,

T1)

• WT• Reduce the number of products that cannot give profit in order to cut the cost

(W1, T2)

FINANCIAL POSITION (FP)

STABILITY POSITION (SP)

COMPETITIVE POSITION

(CP)

INDUSTRY POSITION (IP)

FP

SP

CP

IP

7

6

5

4

3

2

1

-3

-2

-1

-4

-5

-6

-7

0-7

-6 -5 -4 -3 -2 -1 1 2 3 4 5 6 7

•

COMPETITIVE STRATEGIES

BACKGROUND OF COMPANY

P&G is located in competitive strategies. The strategies used by P&G:

1- Market penetration

- P&G will able to increase market share through advertising.

- P&G spend a lot on advertising compared to the others

2- Product development

- Can enhanced market share and sales of the company.

- P&G can improvised their current products or develop new

products to retain old customers and obtain new customers.

BACKGROUND OF COMPANY

  DivisionSales

/Revenue ($ millions)

%Profit

($ millions)% RMSP

Net sales growth %

1Beauty

 19,491 24 2,712 23 0.60 3

2Grooming

 7,631 10 1,477 13 0.20 3

3Health Care

 11,493 14 1,860 16 0.30 2

4Snacks and

Pet Care 

3,135 4 326 3 0.10 1

5Fabric Care/ Home Care

 23,805 30 3,339 28 0.80 3

6Baby Care/ Family Care

 14,736 18 2,049 17 0.40 4

 Total

 80,291 100 11,763 100   3

23%

1.0 0.7 0.6 0.5 0.4 0.3 0.2 0.1 0.0 0.9 0.8

+5

+10

+15

-5

-15

-10

-20

0

+200

2 3 1

5 6

28% 23% 17%

16% 13%

3%

RELATIVE MARKET SHARE POSITION (RMSP)

The division beauty and fabric care/home care is located in

Quadrant II which is “Stars”.

Quadrant II – the organization’s best long-run opportunities for

growth and profitability. Divisions with a high relative market

share and a high industry growth rate should receive substantial

investment to maintain or strengthen their dominant positions.

Other 4 divisions located in Quadrant I which is “Question Marks”.

Quadrant I represents the divisions that have low relative market

share position, yet they compete in a high-growth industry.

Internal Factor Evaluation (IFE)

Strength Weight Rate Score

Diverse range of business segments 0.3 4 0.12

Large amount of customer based 0.4 2 0.8

Most products are not highly seasonal 0.2 3 0.6

Weaknesses Weight Rate Score

Price paid for commodities for the

products subject to fluctuation

0.2 10.2

Previous CEO has focused the strategy

on innovation without concern the

customer demands

0.3 2 0.6

Total Score IFE= 2.32

External Factor Evaluation (EFE)

Opportunities Weight Rate Score

Research and development efforts to

develop technology

0.3 2 0.6

Capturing market share from

competitors through advertising

0.2 2 0.4

Accelerate its growth in developing

markets such as Brazil and India

0.5 2 1.0

 

Threats Weight Rate Score

A material change in consumer

demand or products could have a

significant impact on business

0.3 1 0.3

Business is subject to legislation,

regulation as well as enforcement in

the U.S and abroad

0.15 3 0.45

Total Score EFE = 2.75

Hold and maintain

RAPID MARKET GROWTH

Quadrant II 1. Market development 2. Market penetration 3. Product development 4. Horizontal integration 5. Divestiture 6. Liquidation

Quadrant I 1. Market development

2. Market penetration 3. Product development

4. Forward integration 5. Backward integration

6. Horizontal integration 7. Related diversification

Quadrant III 1. Retrenchment 2. Related diversification 3. Unrelated diversification 4. Divestiture 5. Liquidation

Quadrant IV 1. Related diversification 2. Unrelated diversification 3. Joint ventures

SLOW MARKET GROWTH

STRONG COMPETITIVE

POSITION

WEAK COMPETITIVE

POSITION

Procter & Gamble could be considered in quadrant IV, between slow

market growth but have strong competitive position.

This firm has characteristically high cash flow levels and limited

growth needs and often pursue related diversification successfully.

The reason is, in July 2010, P&G had changed their CEO from Mr.

Lafley, who focused on innovation to Mr. McDonald who focuses on

lower-end products aimed at consumers looking for discounts.

Even P&G’s revenue increased to $78.9 billion compared than

previous year, their profits declined $12.7 billion compared than

previous year.