Last Updated 06 Jul 2020

Historical background of Procter and Gamble

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The company was formed in 31st October 1837 by two step brothers William Procter and James Gamble. Before they merged to make the company, the two owned different companies with William Procter having a candle making company while James Gamble having a soap making company. During the economic recession of 1837, the two companies were highly affected by the stiff competition which almost led them out of market. In order to have a competitive advantage within the market, the two merged together by the request of their father.

The new company (Currently the Procter and Gamble) was formed. It started experiencing capacities of growth and competition. Successfully, the 19th Century was a good moment for the company where it expanded its products and services to a wide scope of the global market that was also characterized by high quality that gave an attractive package of demand in the world market. It is currently a consumer goods company with A. G. Lafley as its CEO. It has 138000 employees as of 2007 and revenue turnover of US$76. 5 billion as of the 2007 financial year.

Mission statement To recover, restore and reconcile individuals and families Vision statement To live in a community where the residents have ambition and liberty to play, and work with values of respect, faith and love. Growth and market share. Since its conception, P&G has been compounded by a broad array of growth in its activities that gives it the competitive advantage of nurturing a strong market share. The starting point of the company was comparatively low to what it has currently. In 1859, history has it that the company waged $1million of sales.

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However, as 2007 the company attained U. S. $76 billion sales with a net profit of US. $10. 3 billion. At the time of its conception, the company had eighty employees but its current growth momentum has given it 138,000 employees as of the 2007 financial year. The trends in its growth are also characterized by a developing autonomy of products. It had two products at its conception period which were the candles and soap. However, the current portfolio has rendered it to have more than one hundred products output that are produced by high research activity and technological outlay.

Its currently expanding status in terms of quality of products and their numerical scope has provided standards for competitive advantage in the highly competitive global market. Its research and development department has been actively involved in research activity that has seen the company expand in terms of innovations and branding. (http://www. pg. com/en_US/index. shtml) The historical background of P&G is widely elaborated and captures a wide domain of activities and processes that have seen the company evolve to its current status. Read about T

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In order to achieve a strong derivative into the market competition derivatives, Procter and Gamble has embraced a strong supply chain management that has given it the potentials of arising as 23rd biggest company in the U. S and the 10th most preferred company. In order to increases its competitive portfolio, P&G has embraced a strong culture of corporate acquisitions increasing the product scope and consequently its level of competition and market share. Evidence to this, it would be rational to pinpoint of the comparative advantage waged by the company in its acquisition of Anglo-Dutch Uniliver and the Gillette Companies in the year 2005.

Diversity in its product range gave the company an attractive portfolio with which it could participate in competing the existing market that was highly shaped by increasing product quality brought about by changing methods of production, branding and innovation. As of its fiscal year of 2007, its characteristic dominance of categories in consumer products made the worth of creativity in its brand management. Branding is one of its strategies that have been seen to restore a high level of product output and consequently potentials for competition and increased market share.

Product range. As currently evident, the competitive portfolio of Procter and Gamble is provided by the wide range of products that meets different consumption needs and demands of the consumers within the market. The company’s production operations are grouped in terms of three business units/product outputs. Each segment has undergone further subdivision that elaborate the product lines in each division. These are; • Household care: This unit is further divided into family care and baby care, home care and fabric care segments

• The beauty care: This is composed of the grooming and the beauty segment • Well-being and health segment: It consists of the pet, snacks, health care and coffee segments. Various products are then produced in line with the different segments. The product output of Procter and Gamble is aligned with close to 100 brands with 23 of these brands attracting net sales of 1. 3 billion U. S. dollars. Eighteen of the remaining slots attract almost a billion in net sales. (http://www. pg. com/en_US/index. shtml)

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