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GODREJ CONSUMER PRODUCTS

INTRODUCTION

Godrej Consumer Products (GCPL) is a leader among India's Fast Moving Consumer
Goods companies, with Personal and Home Care Products. Our brands, which include
Cinthol, No. 1, Expert and Ezee, among others, are household names across the country.

Branch Offices in Mumbai, Delhi, Kolkata and Chennai ensure pan-India coverage, while
factories located at Malanpur (Madhya Pradesh), Thana (Himachal Pradesh), Katha
(Himachal Pradesh), Guwahati (Assam) and Sikkim cater to the diverse requirements of
our product portfolio.

With the acquisition of Keyline Brands in the United Kingdom, Rapidol and Kinky
Group, South Africa and Godrej Global Mideast FZE, a 100% subsidiary of Godrej
International, GCPL now owns international brands and trademarks in Europe, Australia,
Canada, Africa and the Middle East.

Products:

Wide array of products are manufactured by Godrej Consumers Products. The company
is popularly known for its Soaps, Toiletries, Hair Care, Household Care, and Fabric Care
solutions not only in India, but also in the countries across the globe. To offer the best to
the consumers, GodrejCP employs the Total Quality Management system. Major
GodrejCP products include the following:

In the hair color category, Godrej Consumers Products is considered as the best. It
has variety of products such as, Godrej Liquid & Powder Hair Dyes, Godrej Kesh
Kala Oil, Godrej Renew Coloursoft Liquid Hair Colours, and Nupur based Hair
Dyes.
Fairglow, Cinthol, Godrej No. 1 are some of the popular Toilet soaps of Godrej
Consumers Products. FAIRGLOW is the first Fairness soap in India. GCPL is also
the contract manufacturer of toilet soaps of some of the renowned brands in India.
EZEE is the Liquid Detergent brand of Godrej Consumers Products, and it is rated
as the best in this category.
Mission:
Godrej Mission is to operate in existing and new businesses which capitalize on
the Godrej brand and corporate image of reliability and integrity.
Godrej objective is to delight its customer both in India and Abroad.
Godrej shall strive for excellence by nurturing, developing and empowering its
employees and suppliers.
Godrej encouragesan open atmosphere, conducive to learning and team work.
Accelerate the growth of Indian household insecticides market.
To globalize the business rapidly.
Enriching Quality of Life Everyday Everywhere.

Vision:

We are dedicated to Deliver Superior Stakeholder Value by providing solutions to


existing and emerging consumer needs in the Household & Personal Care Business.
We will achieve this through Enduring Trust and Relentless Innovation
delivered with Passion and Entrepreneurial Spirit.

The world is moving at an extremely fast pace. Borders are being transcended,
opportunities are arising in locations and businesses which many never cared to look at, a
few years ago. Flexibility, swiftness and the ability to identify and quickly capitalize on
these opportunities is becoming increasingly critical for companies to enhance their
competitive position and grow. At Godrej Consumer Products Limited (GCPL) we have
during the year under review, endeavoured to put in place all the building blocks so that
we are optimally prepared for the future and ensure that we are best placed to strengthen
our growth and create value for all our stakeholders.
After extensive and in-depth research to enable us to better understand our target
customers we have launched a range of exciting consumer centric offerings across all our
key business categories. These have been supported by focused media, advertising and
promotional campaigns. It is also becoming increasingly clear that in India, growth will
be driven by the relatively untapped rural and interior areas. We have as a result
considerably expanded our presence in these regions, enhancing our sales and distribution
infrastructure. Further as you are aware, your Company has been consistently exploring
viable and accretive opportunities globally. Here too, the opportunities lie in the emerging
and developing markets. We have identified three key geographies, namely Africa, Asia
and Latin America and have made considerable progress in the .rst two. Not only are
these geographies less tapped, they also have similar demographic pro.les and behavior as
the average Indian which is the consumer we best understand and cater to.
Last but not the least, your Company has and continues to look to optimize its .xed and
variable costs to
Become more efficient and lean.
INDUSTRY ANALYSIS:

Products which have a quick turnover, and relatively low cost are known as Fast Moving
Consumer Goods (FMCG). FMCG products are those that get replaced within a year.
Examples of FMCG generally include a wide range of frequently purchased consumer
products such as toiletries, soap, cosmetics, tooth cleaning products, shaving products
and detergents, as well as other non-durables such as glassware, bulbs, batteries, paper
products, and plastic goods. FMCG may also include pharmaceuticals, consumer
electronics, packaged food products, soft drinks, tissue paper, and chocolate bars.
Indias FMCG sector is the fourth largest sector in the economy and creates employment
for more than three million people in downstream activities. Its principal constituents are
Household Care, Personal Care and Food & Beverages. The total FMCG market is in
excess of Rs. 85,000 Crores. It is currently growing at double digit growth rate and is
expected to maintain a high growth rate. FMCG Industry is characterized by a well
established distribution network, low penetration levels, low operating cost, lower per
capita consumption and intense competition between the organized and unorganized
segments. The Rs 85,000-crore Indian FMCG industry is expected to register a
healthy growth in the third quarter of 2008-09 despite the economic downturn.
The industry is expected to register a 15% growth in Q3 2008-09 as compared
to the corresponding period last year. Unlike other sectors, the FMCG
industry did not slow down since Q2 2008. the industry is doing pretty well,
bucking the trend. As it is meeting the every-day demands of consumers, it
will continue to grow. In the last two months, input costs have come down
and this will reflect in Q3 and Q4 results. Market share movements indicate that
companies such as Marico Ltd and Nestle India Ltd, with domination in their key
categories, have improved their market shares and outperformed peers in the FMCG
sector. This has been also aided by the lack of competition in the respective categories.
Single product leaders such as Colgate Palmolive India Ltd and Britannia Industries
Ltd have also witnessed strength in their respective categories, aided by
innovations and strong distribution. Strong players in the economy segment
like Godrej Consumer Products Ltd in soaps and Dabur in toothpastes have
also posted market share improvement, with revived growth in semi-urban
and rural markets.
Swot Analysis

Strengths:
Low operational costs
Presence of established distribution networks in both urban and rural
areas
Presence of well-known brands in FMCG sector

Weaknesses:
Lower scope of investing in technology and achieving economies of
scale, especially in small sectors
Low exports levels
"Me-too products, which illegally mimic the labels of the established
brands. These products narrow the scope of FMCG products in rural
and semi-urban market.

Opportunities:
Untapped rural market
Rising income levels, i.e. increase in purchasing power of consumers
Large domestic market- a population of over one billion.
Export potential
High consumer goods spending

Threats:
Removal of import restrictions resulting in replacing of domestic
brands
Slowdown in rural demand
Tax and regulatory structure
Substitutes

Generally one can point at two general broad substitute threats in the Premium soap
category. One threat is from the use of products like body wash and face wash. Though
the use of these products forms a very small part of consumption this is basically due to
the high costs associated with such products. One can see in the some developed
countries which have already registered a cent percent penetration, the consumption of
soap has now decreased due to the customers upgrading to Body wash and Face wash.

The second threat is from downtrading i.e. the consumers from the premium category
opting for the popular category soap. Any small change in the price of the Premium soap
can cause in the shift of the price conscious consumer to opt for shifting to a soap in the
Popular category. Most companies like HLL, Nirma cater to both the categories.

Suppliers

The major input for the soap manufacture is vegetable oil (around 80% of the raw
materials). Earlier Animal Fat was used which was even cheaper, but after the Indian
government banning animal fat, one had to shift to vegetable oils. They are not available
in India and thus have to be imported from countries like Malaysia, Indonesia and China.
There are only few players who export palm oil from these countries and as such these
exporters have a commanding position.

There are various grades of palm oil available and the manufacturer can switch between
these grades to save on the cost of inputs. Besides, soap can be manufactured either from
fatty acids or directly from the oil.

The soap manufacturers cater to the current and future needs of consumers through the
development of new formulations and relate these to their suppliers. A prime example of
this is the current trend towards producing higher quality soaps and the customization of
the products for e.g. Soap for different skin types. Such moves result in new formulations
that force suppliers to modify quality of inputs.

Companies like Godrej and VVF who previously used to supply soaps to other bigger
companies have gone for forward integration and started selling their own brands.

Small players cannot afford to import Oils as the price of Oil keeps on fluctuating and
these fluctuations, if on the higher side cannot be incorporated in the price of the product
in this age of cut-throat competition. So they directly purchase fatty acids of oils from
large-scale Indian manufacturers who import Oil and convert them to fatty acids.

Buyer

To a large extent, Premium Soap is a price sensitive market. Off late there has been an
increasing trend towards downtrading. And this has forced the manufacturers to lower the
prices or offer temporary discounts to woo the consumers who are either downtrading
from the popular segment or graduating upwards from carbolic soaps.

This sector faces low level of brand loyalty. Switching costs is very low and these results
in price war and people are concentrating on value-for-money. This forces a lot of players
to go for frequent promotional schemes like 3-on-1, 2-on-1.

Earlier the decision for purchasing the soaps was equally balanced between man and
woman (50:50).

Now the decision ratio is 60:40 in the favor of woman purchaser. This proves the fact that
today most soaps are targeted at the Indian woman.

The buyers, even in the rural area are subjected to the media invasion and are well
informed about the basket of products available in the market and thus take a rational
decision.
PEST Analysis

Political Factors:

Earlier the soap industry was under the Licence-raj restrictions. But, after liberalization of
economy by the Narshima Rao government there has been a spurt in the number of
players in the organized as well as the unorganized sector. A player like Henkel SPIC is
good example of this. The political system in India is undergoing vast change. There has
been competition between various states like Maharashtra, Gujarat, Andhra Pradesh and
Madhya Pradesh. The sops given to new entrants like sales tax concessions and other
incentives help encourage players to open their shops in these states.

Government banned the import of tallow, a soap making raw material (which was
requiring a very little processing to make soap). It then followed an incidence of
adulteration of vanaspati by unscrupulous manufacture.

Economic Factors

Soaps in India cost very high in India as compared to other countries like Indonesia. E.g.
100 gms of soap in Indonesia costs rs.4.25 whereas in India it costs rs.10 approximately.
This is primarily attributed to the high cost of imports due to high import duties. Since
India is now a WTO member India will have to bring down the import duty rates to as
much as 20% from 35%. Also the excise rate at 16% forms formidable portion of the
cost. The Indian players are lobbying with the government agencies to reduce this duty
which can bring down the cost of the final product. For toilet soap, the average
expenditure per user household for low-income households is Rs. 237, while it is Rs. 706
for high-income groups.
Social factors:

The social factor is very important when it comes to Premium soaps segment of the soap
market. With the rising education and disposable income levels, the need for hygiene and
personal / skin care becomes important. Premium soaps are thus targeted at the audience
to change their habits by raising their aspiration levels.

Lack of good hygiene factor like availability of clear water for bathing purpose also
discourages extensive use of premium soaps by vast population. Fragmented approach of
govt. and NGOs towards inefficient PHC-primary health center also aggravates the
problem. Investment in basic sanitation will make biggest improvement to health and also
to the soap market.

The growing reach of advertising medias like satellite and cable TV too is expected to
give a boost to the market penetration initiatives of the industry players.

Technological Factors:

The industry though capital intensive is not very technology intensive. Premium soap
manufacturing though compared with other soaps manufacturing relies to an extent on
technology (especially in the finishing stage). The more important is logistics
management where marketing and distribution play a pivotal role. Here technology like
(SCM) Supply Chain Management and (E-CRM) Electronic Customer Relationship
Management will play a pivotal role. Companies like HLL are working very hard towards
such a system to rope up the entire small stores and retailers (Kirana Stores).

The results of a survey done by National Council of Applied Research (NCAER) suggest
that Indian FMCG space is all set to enter a new growth phase, sample this: the study
says that the lower income group is expected to shrink from over 60 percent (1996) to 20
per cent by 2007 and the higher income group is expected to rise by more than 100 per
cent. It looks; the industry is all set for a fast-paced race ahead.
PLAY WOOD TOYS

Abstract

The strategic management process can be described as an objective, logical, systematic


approach for making major decisions in an organization. It attempts to organize
qualitative and quantities information in a way that allows effective decisions to be made
under conditions of uncertainty. Yet strategic management is not a pure science that lends
itself to a nice, neat one-two-three approach.

Based on past experiences, judgment, and feelings, most people recognize that intuition is
essential to making good strategic decisions. Intuition is particularly useful for making
decisions in situations of great uncertainty or little precedent. It is also helpful when
highly interrelated variables exist or when it is necessary to choose from several plausible
alternatives. Some managers and owners of business profess to have extraordinary
abilities for using intuition alone in devising brilliant strategies. "Albert Einstein
acknowledged the importance of intuition when he said," I believe in intuition and
inspiration. As times I feel certain that I am right while not knowing the reasons.
Imaginations is more important than knowledge, because knowledge is limited, whereas
imagination embraces the entire world."
SWOT Analysis

SWOT analysis enables us to find out a better way of utilizing the strengths of an
organization to get maximum benefits of the opportunities available in the industry and it
also helps in dealing with threats that may adversely affect the business of the firm in
future, So, the policy of any firm should be to focus on strengths to get better results from
opportunities, deal with threats by using your strengths and try to convert your
weaknesses in your weaknesses, opportunities and threats for the PLAY WOOD TOYS
(Pvt) Ltd.

Strengths:-
One of the main strengths of PLAY WOOD TOYS is the financial strength of the
company because it is supported and controlled by PLAY WOOD TOYS locally and
internationally. Therefore, unlike past, now they can start any long term project
without concerning too much about finances available.

PLAY WOOD TOYS is enjoying a positive image in the minds of the consumers.
They normally think that it is better in quality as compare to other competitors
available in the market.

Better workforce is strength of the company. Due to better availability of finance they
can hire quality workforce and get better results.

Established Nation-wide infrastructure is helping the organization to increase the


sales volume of the company.

PLAY WOOD TOYS has up to date technology in its production. As Play Wood Toys
company claims that they are very sensitive about hygienic conditions, so that's why
they using up to date technology to achieve this objective.

Weaknesses:-
The major weakness of the company is its distribution channel. It is one of the main
reasons of its slow progress and low market share in this market. Due to lack of
availability of the products and less differentiation from competitors, it has become
very difficult to capture a big market share.
The company is also lacking in utilization of the resources, especially in Lahore plant.
People are having various facilities but they don't their best use.

Opportunities:-
The best opportunity for PLAY WOOD TOYS is to increase market share through
increasing the availability of the products in the market.
The company can also produce better results by creating awareness in the society
about the quality of the products they are offering.
A huge part of the market is still waiting for first entry. PLAY WOOD TOYS can get
the advantage of first entry if it focuses on such areas.
Threats:-
High production capacity of the competitors because they are having a better chance
to increase the production and availability of the products and further increase the
market share. The local manufacturers can also disturb the market share due to their
low price offerings.

Conclusion

All firms have a strategy, even if it is informal, unstructured, and sporadic. All
organizations are heading somewhere, but unfortunately some organizations do not know
where they are going. The old saying "If you do not know where you are going, then any
road will lead you there!" accents the need for organizations to use strategic-management
concepts and techniques. The strategic-management process is becoming more widely
used by small firms, large companies, nonprofit institutions, governmental organizations,
and multinational conglomerates alike. The process of empowering managers and
employees has almost limitless benefits.

Organization should take a proactive rather than a reactive approach in their industry, and
they should strive to influence, anticipate, and initiate rather than just respond to events.
The strategic-management process embodies this approach to decision making. It
represents a logical, systematic, and objective approach to decision making. It future
direction. The stakes are generally too high for strategists take the time to think about
their businesses, where they are with their businesses, what they want to be as
organizations and then they implement programs and policies to get from where they are
to where they want to be in a reasonable period of time.

It is know and accepted fact that people and organizations that plan ahead are much more
likely to become what they want to become then those that do not plan at all. A good
strategist plans and controls his or her plans, whereas a bad strategist never plans and
then tries to control people.
ACKNOWLEGEMENT

I Ansh Kukreja, student of BBA LLB Amity Law School Center


2, would like to express my special thanks of gratitude to my
teacher Dr DEVENDER SINGH who gave me the golden
opportunity to do this wonderful project , which also helped me in
doing a lot of Research and I came to know about so many new
things I am really thankful to them.

Secondly I would also like to thank my parents and friends who


helped me a lot in finalizing this project within the limited time
frame.