Colgate India

Submitted By: Fenil Bharwadv (0112) Prajita Chowdhury (0212) Rahil Darji (0312) Maulee Desai (0412) Pujan Gondalia (0512) Ashal Vyas (2612)

Written Analysis and Communication Company Report on Colgate India

Submitted to: Mrs. Jayshree Rammohan 13 January 2013

Colgate India

INTRODUCTION Colgate Palmolive Company is an American multinational consumer products company. It focuses on production, distribution and provision of health care, household and personal products. Colgate-Palmolive is Rs 1,300 Crore Company. It enjoys 50% market share in 2,400 Crore domestic market. Out of 4.5 million outlets, 1.5 million outlets are direct outlets. The Company is having four wholly owned subsidiaries namely Colgate-Palmolive (Nepal), Multimint Leasing & Finance and Jigs Investments and Passion Trading & Investment Company. In November 2007, it acquired a 75% equity interest in Advanced Oral Care Products, Professional Oral Care Products and SS Oral Hygiene Products. It is the fastest growing and one of the oldest companies catering to the personal care products. The company is regularly coming up with new products and has been a consistent financial performer. Company offers number of products in oral care, health care and household care. Following table shows the product range of Colgate Palmolive Company. Appendix 1 shows the brand details of products in each segment. SR NO 1 SEGMENT Oral care PRODUCTS Toothpaste, Toothbrush and Toothpowder, Whitening Powder and Mouthwash 2 Personal care Body wash, Liquid hand wash, Shave prep, Skin care and Hair care 3 Household care Surface care

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HISTORICAL TIMELINE: (Wikipedia) Today: Today, with sales surpassing $15 billion, Colgate focuses on four core businesses: Oral Care, Personal Care, Home Care and Pet Nutrition. Colgate now sells its products in over 200 countries and territories worldwide. 2006: Colgate enters the fast-growing Naturals segment by purchasing Toms of Maine, a leader in that market in the United States. 1989: Annual Company sales surpass the $5 billion mark. 1953: Colgate-Palmolive Company becomes company's official name. 1930: On March 13, Colgate is first listed on the New York Stock Exchange. 1908: Colgate is incorporated by the five sons of Samuel Colgate. Ribbon opening added to Colgate tube: We couldn't improve the product so we improved the tube. 1906: Colgate & Company celebrates its 100th anniversary. Product line includes over 800 different products. 1896: Colgate introduces toothpaste in a collapsible tube. 1864: B.J. Johnson opens a soap factory in Milwaukee, WI, which later becomes the Palmolive Company. 1857: Upon the death of founder William Colgate, the company is reorganized as Colgate & Company under the management of Samuel Colgate, his son. 1806: William Colgate starts a starch, soap and candle business on Dutch Street in New York City.

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MANAGEMENT TEAM (Colgate India) Prabha Parameshwaram (MD): She Joined Colgate-Palmolive India in 1995. She has since, held a series of significant positions in New York in Global Business Development Oral Care and in Global Toothbrush Division. Paul Alton (Executive VP & CFO): Mr. Paul Alton joined Colgate in 1989 in the Operational Analysis Department of the European Division. In 1995 Mr. Alton became General Manager of Project Catalyst where he played a vital leadership role in successfully rolling out SAP across the European Division. Ravi Subramanyam (Director, Global Technology Centre): Dr. Ravi Subramanyam leads the Global Technology Centre (GTC), in Global Research & Development Implementation for Colgate India and supports the Greater Asia and Africa/Middle East Divisions. Aditya Singh (VP, Human Resource): Mr. Aditya Singh initially joined Colgate-Palmolive, India in 1994 in Human Resources and was with the company till 2004. During this period, Aditya made significant contributions in organizational development, rewards and performance management, succession planning, employee and industrial relations. Manu Mehrotra (VP, toothbrush category supply chain): Mr. Manu Mehrotra joined Colgate-Palmolive at the Aurangabad manufacturing plant in India in 1989 and soon took over the responsibilities of Senior Technology Leader for the Africa/Middle East Division, contributed significantly to technology transfer, quality up-gradation and margin improvement.

Colgate India

MILESTONES Colgate-Palmolive in its brief history of 75 years has achieved numerous milestones. Some of them are as follows: 1) In 2003 Colgate was ranked as Indias Most Trusted Brand across all categories by Brand Equitys Most Trusted Brand Survey for four consecutive years from 2003 to 2007. 2) Colgate was also rated as the number one brand by the A&M MODE Annual Survey for Indias Top Brands for eight out of nine years during the period 1992 to 2001. 3) In 2011 Colgate-Palmolive (India), the market leader in oral care, in association with the Indian Dental Association (IDA) achieved the Guinness World Records for maximum number of dental check-ups in a single day (multiple venues). MARKET SHARE Oral care market in India is driven by innovation, retail availability, packaging and right promotion. Today this market is estimated to be of Rs. 4200 Crore. Toothpaste contributes around 75% in this industry. Colgate-Palmolive is undoubtedly the market leader in the segment by occupying 45% of market share. Its major competitors are HUL and Dabur by occupying 30% and 7% respectively. Other brands collectively occupy 16% of market share.

Colgate India

MARKETING MIX Marketing mix is crucial when a company is determining a products brand offering. It is synonymous to 4Ps: Price, Product, Place and Promotion. Marketing mix of Toothpaste category in oral care segment of Colgate-Palmolive are as follows: 1) PRODUCT: The product should be what a customer needs and desire for. Colgate has maximum number of variants under the umbrella of Colgate-Palmolive. Reports suggest that it is more durable than any other toothpaste. Products are available in various packet sizes such as 50g, 100g, 200g and 400g. Toothpastes for special needs such as Colgate sensitive are launched. 2) PRICE: The price is amount paid by customer for the product. Colgate has some fierce competition in market. Also, FMCG goods dont have high price even when they have high usage. Hence, price is determined according to competitors price. For niche products like Colgate herbal, Colgate blue etc, company charges higher premium. 3) PLACE: It represents from where a customer can buy the product. Product is distributed through the supply chain of company distributor to retailers. Currently, product has presence even in semi-urban and rural market. Company is planning to increase the number of distributors to tap rural market more effectively. 4) PROMOTION: It involves all kind of communication a marketer uses in order to reach out to their target customers. Hence, Colgate has continuous T.V. and F.M radio promotions. Special promotional activities for rural market also. It also celebrated oral health month with dentists all over India.

Colgate India

MARKETING STRATEGIES BRAND Colgate-Palmolive India Ltd STRATEGIES It has become household name since decades now. It offers plethora of products from toothpaste, toothpowders and mouthwashes. Company has gels, tooth whitening pastes and premium herbal products for much aware urban population. Colgate dental cream, Cibaca and Colgate toothpowder are targeted at rural and urban lower income groups. Hindustan Unilever Limited It launched Pepsodent in 1993 to challenge Colgate. It is largest personal care company in terms of market cap first launched close up to challenge Colgate. Colgate was positioned as mouth freshener and hence Pepsodent was launched. It was positioned as complete oral care package in premium segment HUL priced it at Rs. 10 for 40g for rural market. It launched special dishoom dishoom package targeting mothers who worried regarding their kids dental health. Dabour India Limited It offers Promise brand in white

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toothpaste category For herbal category Dabur red, Dabur red Gel, Babool, Babool Neem and Meswak are offered. Babool is currently the biggest brand in Dabur India Ltd.

FINANCIAL REPORT AND ANALYSIS OF COMPANY Colgate- Palmolive discloses its financial information whether it has negative or positive effects. They also disclose they face because of their expansion plans. The level of disclosure of Colgate Palmolive according to industrial standard is above-average. (Russel Kerchen) Colgate-Palmolive reported net sales of Rs 2,206 Crore in year 2010-2011. It has increased its sales by 13% compared to previous years. Its net profit recorded was Rs 402 Crore. Company has achieved strong growth of 12% in volume and its toothpaste segment has achieved growth of 13%. The Company continues its focus in the emerging mouthwash category, registering a substantial increase in volume market share to 22% (Apr10-Mar11) from 7.5% (Apr09Mar10). Colgate offers numbers of products. The contribution of these products in terms of sales as on March 2012 is as follows: Product Sales Value ( Rs. Millions)

Soaps, Cosmetics and Toilet 23358.23 Preparation Toothbrushes brushes Traded Soaps, Cosmetics and Toilet 779.97 Preparation Other Operating revenue- 679.52 and shave 3198.01

Service Income

Colgate India

Others- Traded Other operating

25.47 Revenue- 14.25

Scrap Sales Colgate-Palmolive faces fierce competition. The basic comparison of Colgate-Palmolive with other major brands in India in terms of finance is as follows: Company Hindustan Unilever Sales Current Change (%) 0.73 P/E Ratio Market 52-Week

(Rs.Million) Price 221163.70 541.25

Cap.(Rs.Million) High/Low 1170153.22 580/375

32.70

Godrej Consumer 29800.80 Prod Dabur India Colgate Palmolive. (I) 37593.30 26932.27

709.45 124.35 1422.45

3.08 0.24 4.53

48.79 39.24 38.02

241444.30 216732.25 193442.98

745/370 140/92 1365/932

Now here by comparing the outputs of past three years of the company:

2009-10 (in Lacs) Sales Net PAT Cash profits Total assets Total capital empoyeed Earnings per share Dividend per share Number of shares Number of shareholders
(Colgate India, 2002)

2010-11 (in Lacs) 2,317,40 402,58 436,83 384,10 384,10 29.60 22.00 13,60 1,26

2011-12 (in Lacs) 2,736,17 446,47 485,78 435,39 435,39 32.83 25.00 13,60 1,22

2,024,65 423,26 460,83 330,70 330,70 31.12 20.00 13,60 1,24

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Observing the information given by the company for these years, it can clearly be seen that the sales of the company is continuously increases as 14.26% in 2009-10 to 2010-11 and 18.54% in 2010-11 to 2011-12. PAT also gradually increases from 2010-11 to 2011-12. Observing other parameters it is clearly seen that the parameters are continuously increasing during these three years. The other parameters to compare are that of the equity share data.
130.0 110.0 90.0 70.0 50.0 30.0 10.0 -10.0 Earnings per share Dividend per share Number of shareholders 2009-10 2010-11 2011-12

Hence by observing the above financial information available it can be said that the company is continuously a profit making company in as with lower rate as compared to the other companies. Company has not made loss since last 10 years. (Colgate India, 2002) . hence it is a safe investment option. SWOT ANALYSIS 1. Strengths: a. Brand value in consumer care product industry b. Global market leaders with excellent R&D c. Geographically diverse business 2. Weaknesses: a. Limited market share due to other FMCG products with strong brand names b. Product recalls c. Fake brands supplied under their brand names

Colgate India

3. Opportunities: a. Cover the rural market and increase penetration in urban areas b. Mergers and acquisitions to strengthen their brands c. Taking restructuring initiatives 4. Threats: a. Increasing competition amongst other FMCG products b. FDI in retail allowing international brands c. Threat of fake product (mbaskool, 2012) (S., 2010) MARKETING MIX OF COLGATE Product: 1. Numerous products are present under the umbrella of Colgate-Palmolive. 2. They try to position some innovative products. 3. Launched products with clear segmentation of premium, freshness, popular and economy 4. Introduced product for the category where gap was felt. Place 1. It has strong distribution network. 2. It is planning to strength its network in 14,000 villages in next five year. 3. It has availability in different retail outlets in different geographical locations. Price 1. Prices are comparable to other brands. 2. Overhead expenses reduction strategy Promotion 1. Series of communication initiatives like colgate-shoppe, hero no 1 and dil se. 2. It is emphasizing on relationships with trade owners.

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3. Programs for consumers like colgate ke andar kya hai, school dental education program , and toll free number.

Colgate India

APPENDIX 1 SR NO 1 SEGMENT Oral care BRANDS Colgate Dental cream Colgate Active Salt Colgate Max Fresh Colgate Total Colgate Plax Colgate 360 Actiflex Colgate Sensitive Pro-Relief Toothbrush Colgate 360 Toothbrush 2 Personal Care Palmolive Thermal Spa Palmolive Aroma Shower Gel- Relaxing Palmolive Naturals Liquid Handwash Family Health Palmolive Naturals Moisturizing Body Wash- Milk & Honey

3 4

Home Care Professional Care

Axion- Dish Washing Paste Oral Colgate PerioGard Colgate Sensitive Colgate Sensitive Pro Releif Colgate Gel Kam Colgate Visible White

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Bibliography
Colgate India. (n.d.). Retrieved November 12, 2012, from www.colgate.in Colgate India. (2011). Annual Report 2011-12. Mumbai: colgate india. Colgate India. (2002). Ten years Annual Report. Mumbai: Colgate India. mbaskool. (2012). COLGATE-PALMOLOVE. Retrieved 11 28, 2012, from mbaskool.com: http://www.mbaskool.com/brandguide/fmcg/1516-colgate-palmolive.html Russel Kerchen, Z. G. (n.d.). S., A. (2010, november 25). SWOT ANALYSIS ON Colgate-Palmolive. Retrieved 11 28, 2012, from managementparadise.com: http://www.managementparadise.com/forums/principles-management-po-m/208043-swot-analysis-colgate-palmolive.html Wikipedia. (n.d.). Retrieved November 25, 2012, from http://en.wikipedia.org/wiki/Colgate-Palmolive yousigma. (2011). colgate-pamaolive company(SWOT analysis). Retrieved 11 28, 2012, from yousigma.com: http://yousigma.com/comparativeanalysis/colgatepalmolivecompany.html