Business

Strategy
 About: Dabur
• Dr. S.K Burman started Dabur in 1884
• 4th largest FMCG company in India
• Revenues of US$750 Million (Rs 3416 Crore)
• Market Capitalisation of US$3.5 Billion (Rs 16,000
Crore)
• Perceived as a Herbal brand
• Took over Balsara hygiene and home products
business- Largest Acquisiton
• Launch of NUTRiGO in January, 2011
 About Dabur
Management
• Founder: Dr. S K Burman (1884)
• Chairman: Dr. Anand Burman
• Vice Chairman: Amit Burman
• CEO: Mr. Sunil Duggal
Market Share
 Vision & Values

Vision Statement

"Dedicated to the health and well being of

every household"
 Values
• Ownership
• Passion For Winning
• People Development
• Consumer Focus
• Team Work
• Innovation
• Integrity
 PESTLE- Political factor

• Abolishment of ‘license raj’ and liberalization of Indian economy,

resulted in a boom in the FMCG market through market expansion and
greater product opportunities

• Excise and import duty reduced substantially

• Various states governments like Himachal Pradesh, Uttaranchal and

Jammu & Kashmir encouraged companies to set up manufacturing
facilities in their regions through a package of fiscal incentives

• FMCG companies eagerly awaits goods and services tax (a single

nationwide tax, ) which will cut business costs
 Pestle- Economic factors

• India is one of the largest economies in the world in terms of purchasing

power
• The demand in FMCG sector is expected to triple in value by 2015 from its
2008 value; driven by the rise in the share of the middle class
• According to the BRIC's report indicates that India's per capita disposable
income is expected to rise to USD 1150 by 2015.
• The fast rising economic performance of Indian Economy has created an
environment of optimism on the part of the investors to invest more.
• However, the FMCG companies have to tackle inflation
 Pestle- Social factors

• India is the second most populous country in the world, with

over 1.18 billion people (estimate for April, 2010)
• Around 72.2 per cent of the total households in India (742
million) reside in the rural areas (2001 census)
• Rapid urbanization, increased literacy and rising per capita
income have all caused rapid growth and change in demand
patterns, leading to an explosion of new opportunities
 Pestle- Technological and Legal
factors
Technological-

• Indian consumers are becoming internet savvy

• FMCG firms need to be up-to-date to stay ahead of the competition
• The country is seeing technological developments like the EDI (Electronic
Data Interchange)
• Dabur invested Rs. 15 crores in hardware and software for its go downs and
branches to be directly linked with its headquarters through direct emails

Legal-
• Indian Laws pertaining to Consumers, Employments, labour, Health and
safety are applicable for Dabur
SWOT Analysis
 Strengths
• Strong presence in well defined niches(like value added
Hair Oil and Ayurvedaspecialties)
• Core knowledge of Ayurveda as competitive advantage
• Strong Brand Image
• Product Development Strength
• Strong Distribution Network
• Extensive Supply Chain
• IT Initiatives
• R & D - a key strength
 Weakness
• Seasonal Demand( like chyawanprash in
winter and Vatika not in winter)
• Low Penetration(Chyawanprash)
• High price(Vatika)
• Limited differentiation (Vatika)
• Unbranded players account for the 2/3rd of the
total market(Vatika)
 Opportunities
• Untapped Market(Chyawanprash)
• Market Development
• Export opportunities.
• Innovation
• Increasing income level of the middle class
• Creating additional consumption pattern
 Threats
• Existing Competition( like Himani,baidyanath
and Zandu for DaburChyawanprash and
Marico,Keo Karpin,HLL and Bajaj for Vatika
Hair Oil)
• New Entrants
• Threat from substitutes (like Bryllcream for
Vatika hair oil)
 Strategic Planning
Corporate Level strategy:
• Focus is on expansion in domestic and foreign
market, new product launches and
acquisitions, which will increase sales and
profits.
• This strategy has paid rich dividends for Dabur
and has delivered sales growth ahead of the
consumer non-durable sector average
 Strategic Planning
Business Level Strategy
• Dabur laid down a business strategy called ASTRA to boost
rural sales and to achieve a steady growth in retail.
• Taking help of ACCENTURE to improve the supply chain and
distribution network.
• Dabur also aims at achieving doubled sales by aggressive
ACQUSITIONS.
• The growth strategy for international markets would revolve
around EXPANSION.
• Dabur India has also chalked out its plans to enter the health
and beauty RETAIL market in the country.
 Strategic Planning
Functional Level Strategy
• Dabur is targeting sales growth of above 15 per cent after
implementing Astra, and expects nearly 40 per cent growth in
sales.
• It runs refresher-training courses every six months. About 75 per
cent of the company's sales come form rural areas, hence, it has
created the Astra training consultancy module in five vernacular
languages - Bengali, Tamil, Telugu, Malayalam and Kannada.
• Under Astra, Dabur has categorized its sales and distribution
channels into finer segments, such as key grocers, mass grocers,
chemist, wholesale, small outlet and modern trade.
 Dabur SBU’s:

Dabur India Limted has 3 major strategic

business units:
• Consumer Care Division
• Consumer Health Division
• International Business
 Dabur- Their Strategic Intent
• Focus on growing our core brands across categories, reaching out
to new geographies, within and outside India, and improve
operational efficiencies by leveraging technology
• Be the preferred company to meet the health and personal
grooming needs of our target consumers with safe, efficacious,
natural solutions by synthesizing our deep knowledge of ayurveda
and herbs with modern science
• Provide our consumers with innovative products within easy reach
• Build a platform to enable Dabur to become a global ayurvedic
leader
• Be a professionally managed employer of choice, attracting,
developing and retaining quality personnel
 The Dabur Strategy

• Dabur is present in categories ranging from mosquito

repellents and juices to face packs and honey, some acquired
and some developed in-house

• Dabur believes in in few power brands that are nurtured to

offer huge returns

• It aims to create a few champion brands to result in sustainable

margins
 The Dabur Strategy
• Dabur leverages under its two power brand i.e. Dabur and
Vatika

• Dabur the strategy for a new brand launch- by the third year, a
new brand must contribute to common overheads and by the
fifth year, it should make "some profit“

• The company does not intend to be the market leader but aims
at growing faster than the market

• Dabur is consciously entering only those categories that offer

a platform for herbal products
 Dabur outsources
• To build competitive edge, Dabur asked Accenture to help
identify specific opportunities that would lead to short-term
advantage and long-term growth
• Accenture recommended a two-pronged strategy:
– migration to a nimbler outsourcing model that would
generate value through agility
– support business initiatives and maintenance of its SAP
enterprise resource planning (ERP) system
 Measures Taken
• Accenture launched a three-phase ERP improve-ment program that
involved:

– Correcting the transactional and management information

systems.
– Conducting change management and synchronizing Dabur’s
business processes with realities in an ERP context.
– Developing value realization project
• Leveraging IT for business initiatives
– By designing a Web-based demand planning and
trade promotion forecasting tool, and installed
point-of-sale software at select retail and
wholesale sites
• Outsourcing IT operations
• New sales and distribution strategy was
implemented
Market share and Growth rate for SBU’s
BCG matrix as per SBU’s

International Business
Division Consumer
  Healthcare
Division

Consumer Care
Division
Growth rate and market share of business
categories in Dabur IL.
BCG matrix as per business categories

HealthSupplements(Chyawa HomeCare(Odonil,
nprash, Honey, Glucose) Odomos, Sanifresh)
Foods(Real, Activ)  
 

Oral Care(Dabur Red, Digestives(Hajmola)

Babool, Meswak)
Hair Care(Dabur Skin Care(Gulabari,
Amla, Vatika Hair Oil, Fem)
Vatika Shampoos)
Porter’s Five Forces Model
1) The threat of substitute products:
•threat of generic substitution
•happens where products and services compete for
disposable income
•sells a lot of varied products in all price range
•should ensure that it offers quality products for all
income groups
2) The threat of the entry of new competitors:
•Dabur should focus on product differentiation
• one of the most trusted names in the FMCG sector
•enjoys a loyal customer base
• as the demand increases, should focus on aggressive
marketing strategy
• should focus on targeting middle aged consumers
3) The intensity of competitive rivalry:
• players and competitors are Hindustan Unilever Ltd.,
Tata Tea, Nestle India Ltd., Britannia Industries Ltd.,
Colgate Palmolive Ltd., Marico Ltd.
• strategy in order to increase its global dominance
• If a company doesn't differentiate its products
• leads to an increased rivalry between competitors
4) The bargaining power of customers:
• have increased dramatically with Globalisation
• Improve the quality and
• reduce the prices over the period
5) The bargaining power of suppliers:
• very strong bond with the suppliers
• policy of having good relations
• This helps in having a good relation with the
suppliers
• being accountable to stakeholders, shareholders
 Future Strategies
• Focus on growing its core brands - reaching out
to new geographies – leveraging technology
• Strive for top recall
• Become global ayurvedic leader
• Innovation of Products
• Be a professionally managed employer
• Provide superior returns to shareholders &
customers
 Future Strategies
• Stress on making more competitive logistics
and inventory management system
• Advertising strategy for rural markets
• Retail Stores
• Implementation of ASTRA
 Presented By:
• Sanjeev Vishwakarma – 76
• Shilpa Panda – 93
• Rashmi Vishth – 95
• Megha Gandhi – 96
• Varidhi Agarwal – 117
• Jitendra Sharma – 118
Thank You…! 