SBU(STRATGIC BUSINESS UNIT

)

DEFINITION An SBU is a unit of the company that has a separate mission and objectives and that can be planned independently from the other businesses.it all depends on how the company is organized. An SBU can be a company division. . a product line or even individual brands .

FMCG ITC ´ HUL ´ P&G ´ Dabur ´ Marico ´ .

Health Care. Personal Care .SBU ITC:. Edible Oil.Home Care. Personal Care . ´ Dabur:. Personal Care .Foods . Hair Care . Fabric Care.Foods.Cigarettes & Cigars ´ HUL:.Foods . ´ Marico:-Hair Care . ´ . ´ P&G:-Baby Care .

and 3. Cost leadership. 2.PORTER¶S GENERIC STRATEGIES ´ The generic strategies are: 1. . Differentiation. Focus.

STRATEGY ADOPTED BY COMPANIES ITC:.Because it satisfy the unique smoking need of it·s customer. ´ .ITC use Focus strategy for Cigarettes & Cigars SBU. ´ Reason:.Cigarettes & Cigars ´ Strategy ² Focus :.

Lux) ´ .HUL:.Lakme)for most of products along with cost strategy for some of its products(Lifebuoy.Personal Care ´ Strategy:-Differentiation & cost(for some Product) ´ Reason:-HUL uses differentiation strategy(Dove .

e.Because it caters to very small segment i.P&G:-Baby Care ´ Strategy:-Focus ´ Reason :. ´ . children between 0-3 yrs of age.

Marico:-Hair Care ´ Strategy:-Cost Leadership ´ Reason:-Marico is cost leader in Hair oil segment by launching different packing of it·s parachute hair oil at affordable price. ´ .

Dabur:-Health Care ´ Strategy:.Differentiation ´ Reason:. ´ .Because it satisfy unique need of the customer which no other product in health care segment give example Dabur Chyawanprash.

4 17.622 18.1) 13. Paper & Packaging Total Less : Inter segment revenue Gross sales / income from operns.1) 0.8 20.955 851 3.862 3.9 20. Segment Revenue ( et) a) FMCG .6 12.014 18.8 15.846 2.925 911 3.4 (10.776 2.7) 0.Cigarettes .817 2.822 25.931 2.786 935 3.215 2.260 2009-10 9.Cigarettes .634 12.234 28.SEGMENT REVENUES 2009-10 1.5 Goly 19.144 2008-09 7.4 14.781 3.Others Total FMCG b) Hotels c) Agri Business d) Paperboards.1 0.647 18.1 (9.006 10.Others Total FMCG 17.115 3.321 3.4 14.129 1.3 Full Year 2008-09 Goly b) Hotels c) Agri Business d) Paperboards.1 (0.612 14.153 15. .674 23.862 3.3 20.603 15.8 16. Paper & Packaging Total Less : Inter segment revenue Net sales / income from operns.846 2.108 20.642 20.020 3.283 3.672 26. Segment R evenue (G ross) a) FMCG . 2.

Yes. ´ We can see the approx growth of 20% in net profit from Cigarettes business of the company. ´ . Looking at the financial result for the past 2 financial year the company can sustain the competitive advantage over the next 5 years because of it·s focus strategy.

3] HIGH COMPETITION FROM ESTABLISHED BRANDS .ENVIRONMENT CHALLENGES 1] NEGATIVE PUBLICITY FOR SMOKING COULD EFFECT ITS CIGARETE SEGMENT. 2] GOVERNMENT IS UNDER HUGE PRESSURE FROM PUBLIC ORGANISATIONS FOR BANNING TOBACCO PRODUCTS WHICH COULD EFFECT IT ADVERSILY.

4] COMPETITION FROM UNBRANDED PRODUCTS. . 6]POOR MONSOON LEADS TO POOR AGRICULTURALGROWTH WHICH WOULD AFFECT THE AGRI-EXPORTS. 5] DUE TO TERRORIST ATTACKS THE TOURISM INDUSTRY HAS TAKEN A BACK SEAT WHICH WOULD AFFECT THE HOTEL SEGMENT.

5] HIGHILY PROFESSIONAL MANAGEMENT. 7] EXCELLENT BRAND MAKING CAPABILITY HELPING IT TO DIVERSIFY IT INTO RETAILING . 3] HIGH QUALITY STANDARD PRODUCTS & SERVICES 4] EXCELLENT EXPORT EARNINGS. ITC HAS 105 SUBSIDARIES CONNECTED WITH ITS VARIOUS OPERATIONS. 6] EXCELLENT DISTRIBUTION NETWORK.STRENGTHS 1] MANAGING DIVERSE BUSINESS. 2] WEALTH OF LOCAL KNOWLEDGE & INTERNATIONAL EXPERTISE HELPS IT TO BE GLOBALLY COMPETITIVE.IT & HOTELS SEGMENTS .

11] SOPHISTICATED RESEARCH & DEVELOPMENT FACILITIES. .8] A LASTING IMPRESSION BY CATCHY ADS. 9] THE LIFESTYLE RETAILING SEGMENT HAS WON ACCLAIM & MOVING TOWARDS HIGHER SALES. 10]STEADY INCREASE IN THE RETURN ON CAPITAL EMPLOYED.

CONSUMERS ARE SWITCHING TO OTHER CHEAPER FORMS OF TOBACCO. 2] HIGH COMPETITION FROM ESTABLISHED BRANDS WHICH HAS RESULTED IN REDUCTION IN PROFIT MARGINS. 4] DUE TO HIGH PRICE OF CIGARETTE. .WEAKNESS 1]DIVERSIFICATION INTO VARIOUS LINES IN WHICH IT DOES NOT HAVE MUCH KNOWLEDGE WOULD BE VERY RISKY PROPOSITION. 5] ITS HOTEL INDUSTRY HAS STILL NOT CREATED A BIG SHARE IN THE MARKET SIZE. 3] STEEP INCREASE IN CIGARETTE TAXES HAS ADVERSILY AFFECTED THE REVENUE EARNED.

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