Inorganic Growth Management at Godrej Consumer Products Limited
Presently headed by Adi Godrej, Godrej Group founded in 1897 is located in Mumbai, Maharashtra, India. It has since grown into the largest and the oldest conglomerates, with its presence in different industries comprising appliances, furniture (also office equipment), precision equipment, machine tools, healthcare, interior solutions, food-processing, construction and information technology to name a few. Vikhroli in Mumbai was the conventional manufacturing base for the company. However, due to conglomerate nature, the production units were shifted far from Mumbai. Godrej group can be termed as India’s most trusted brand. The brand commands and delights the faith and support of about 500 million Indians on a daily basis. Currently, Godrej group has a turnover above $4.1 billion. Godrej is an essential part of Indian dayto- day living. Moreover, Godrej has about 26% of its consumers overseas and existence in about 60 countries worldwide. With a high international presence, Godrej strives to make its overseas Indian customers feel at home with its products. Godrej’s guarantee to offer better experience to each of its customer has led to gain consumers’ faith in its products. Godrej realizes that valuable service level is the demand of the contemporary consumers. Godrej is currently at a stage of acquiring skills to build a young tomorrow again.......
Godrej Group Structure and Operations
This conglomerate group has seven large companies having diverse interests in sectors such as FMCG, property as well as agro-care to name a few. The group has two holding companies working individually namely Godrej Industries Ltd., and Godrej & Boyce Manufacturing Co. Ltd. (Exhibit I)............
The Indian FMCG Sector
Rise in the demand and change in consumer preferences, backed by rise in disposable income and the revolution in modern retail, has set the Indian FMCG sector on a roll. The FMCG sector is witnessing huge changes as new players enter the market. Multinationals like Hindustan Unilever, Cadbury, Colgate Palmolive, Nestle on global level and Godrej (toilet soaps and hair dye), Tata’s (cosmetics and edible oils) and Marico on the domestic front enjoyed market dominance in the FMCG sector.................
Godrej Consumer Products Ltd. (GCPL): An Overview
GCPL has a revenue of INR6391 crore and has over 10,347 employees, with a presence in 18 countries, with key focus on FMCG goods and being the major manufacturer of toilet soaps. The company has strong household brands such as GoodKnight, Cinthol, Godrej No. 1, Godrej Expert hair color, etc., which have been rated in the year 2012, by Economic Times Brand Equity amongst the “100 Most Trusted Brands” in India. GCPL also leads in hair colors and household insecticides segment...........
Evolution of Hair Color Products in Godrej
It was in the year 1974 when Godrej was looking to enter a new segment it launched its first hair color product. Being the first product in hair color segment, the product was named as Godrej Liquid Hair Dye and was packed in bottles. The success of the product was endorsed by the fact that the term dye became identical with the name Godrej. Companies used to offer.............
Strategy Formulation of GCPL
GCPL focused on 3x3 strategy, i.e., to sustain in three business categories (hair care, home care and personal wash) in three geographies (Africa, Asia and Latin America). The company decided to play only in categories where it was the market leader or had the potential to be the market leader. Unlike its rival companies like L’Oreal, which were rushing to give their brands premium status, GCPL took a calibrated approach...........
GCPL Goes Global
Godrej has a history of successful Joint Ventures (JVs). Godrej has an approach for the national and international JVs i.e., the JVs of the company are temporary provisions and never permanent. GCPL believes that the purpose of a JV is that both the partners in a JV whether foreign or Indian need it for strategic or tactical reasons. Godrej acquired businesses after estimating three core details i.e.,.............
The Inorganic Journey
GCPL has strong presence in the international market. In synchronization to its 3x3 strategy GCPL acquired companies abroad, for instance, the company acquired 60% stakes in a Chilean company, which was in business of hair color. GCPL also acquired two major companies in Argentina, one of Issue Group and second of Argencos,( Exhibit V) both leading hair colorant companies, GCPL owned leading hair care companies across geographies.............
Exhibits
Exhibit I: Godrej Group Structure
Exhibit II: Code of Conduct for the Board of Directors & Senior Management
Exhibit III: GCPL Market Cap
Exhibit IV: Press Release GCPL to Acquire Remaining 51% Stake in Godrej Sara Lee Limited (GSLL) (May 13th 2010)
Exhibit V: Godrej Consumer Products Limited to Add Argencos SA to its Latin American Hair Care Portfolio
Exhibit VI: GCPL Acquires Rights for 51% Stake in Pan-African Leading Hair
Exhibit VII: Press Release GCPL Launches the All New Godrej Expert Rich Crème Hair Colour (November 23rd 2012)