This Document includes Background of the company, Products and Services, Growth of the Company, Financial Highlights, Reasons for Good Performance, Sectoral Analysis, Competitors Analysis and Porter’s Five Forces Analysis. This word document is prepared by me with the help of The Company website and The Internet.

1. Name : Roshan Rajendra Shanbhag
Std & Div : PGDM / B
Roll No. : 85
Subject : Principles of Management
Project Submitted To:
Prof. Dr. Gomathy Thyagarajan
COLGATE-PALMOLIVE (INDIA) LIMITED

2. The Background of the company
In 1806, William Colgate, an English soap and candle maker, opened up a
starch, soap and candle factory on Dutch Street in New York City under the
name of “William Colgate & Company”. In the 1840s, the firm began selling
individual cakes of soap in uniform weights. After some years William Colgate
died and the company was reorganized as "Colgate & Company" under the
management of his son, Samuel Colgate. In 1873, the firm introduced its first
toothpaste, it was aromatic toothpaste sold in jars. It was also the first company
to sell toothpaste in tube. In 1928, “Colgate-Palmolive-Peet Company” was
formed after major acquisitions. In 1953 "Peet" was dropped from the title,
leaving only "Colgate-Palmolive Company" which is the current name. Colgate-
Palmolive (India) Limited (aka Colgate) is ₹1300 crore, consumer products
company incorporated in 1937. The company is engaged in the personal care
business, which includes oral care. It has manufacturing facilities at Aurangabad
(Maharashtra), Goa and Baddi (Himachal Pradesh). In ₹ 2,400 crore domestic
market the company enjoys 50% of market share. It spreads across 4.5 million
retails outlets out of which 1.5 million are direct outlets. In November 2007, it
acquired a 75% equity interest in Advanced Oral Care Products, Professional
Oral Care Products and SS Oral Hygiene Products, the company is the fastest
growing and one of the oldest company in the personal care products. The
company is regularly coming up with new products and has been a consistent
financial performer. Colgate already has 75% stake in CC Health, which is
engaged in the manufacture of toothpowder at Hyderabad.
Products and Services
The Company’s oral care product includes toothpaste, toothbrushes,
toothpowder, whitening products and mouthwashes. Its personal care product
includes body wash, liquid hand wash, shave preps, skin care and hair care. The
Company’s household care product includes surface care.
Oral care-Under this segment the company offers product like toothpastes,
toothbrush, tooth powder & tooth whitening products.
Personal care -In this segment it offer products skin care, hair care, body wash
and shaving creams.
Household care-Under this segment it has launched brand AXIOM-a dish
washing paste.

3. From the Dentist - New products line introduced by the company under which it
provides products like Gingivitis Treatment, Colgate Sensitive treatment, Tooth
Whitening, Fluoride Therapy, Mouth Ulcer Treatment, Specialty Cleaning. It
has also introduced new products namely Colgate dental floss, ORAGARD-B a
mouth ulcer cream etc. In 2011 Colgate-Palmolive (India), the market leader in
oral care, has introduced Colgate 360° Surround - a ground-breaking and
innovative toothbrush with a unique head.
The flagship brands are “Colgate Dental Cream”, “Active Salt”, “Max Fresh”
and “Colgate Total” along with the recently launched “Visible White”, have
contributed to this growth. The oral care business (toothpastes contributes 60%)
accounts for over 90% of the company’s turnover.
Growth of the Company
1937 -The company was incorporated on 23rd September, as a private limited
company in India and a distribution set up was developed on an all-India basis
with warehouse facilities in Mumbai, Chennai and Calcutta. The Company also
developed its own research and development facility.
1953 -Colgate-Palmolive Company becomes company's official name.
1966 -Palmolive dishwashing liquid was introduced for the first time.
1968 -Company added MFP Fluoride to the toothpaste, which was clinically
proven to reduce cavities and became a milestone achievement for the company.
1983 -Company introduced Colgate Plus toothbrush.
1986 -The Chairman's ‘You Can Make A Difference’ Program was launched,
recognizing innovation and executional excellence by Colgate people.
1988 -The Company received a licence for producing 24,000 tonnes per
annum of fatty acids becoming an milestone achievement in the industry.
1989 -Annual Company sales surpassed the billion mark.
1996 -Axion dishwashing paste was test launched in Maharashtra and
company established a modern facility at Aurangabad, a huge boost for that
place.
1998 -Colgate became the market leader in oral care with its toothpaste
commanding a market share of over 60 per cent in the Indian Market.

4. 2000
-The Company launched its International Palmolive Shave Gel and Palmolive
Shave Foam in response to growing consumer interest in skin conditioning
benefits in India.
-Oral care major Colgate-Palmolive (India) Ltd. made a foray into a new
category of herbal care with the launch of Colgate Herbal touted to be a vehicle
for increasing the company's rural market penetration over a period of time.
-Colgate-Palmolive (India) launched its new Zig Zag toothbrush.
-Colgate-Palmolive (India) launched Colgate Navigator toothbrush in India.
-The Company launched the double-action Palmolive shaving cream promoting
as 2-in-1 Shaving Cream.
-The Company also launched the Naturals Line of toilet soaps in transparent
bars that come in see-through packaging.
2001
-Colgate-Palmolive (India) Ltd. launched international cleaning product- Ajax
in the Indian household products category.
2003
-The Herbal range was expanded with the launch of Herbal White toothpaste for
whitening combined with the benefits of Herbal ingredients.
-Navigator Plus was launched with its unique characteristics as a premium
toothbrush.
-An all new range of Aromatherapy products - Shower Gel, Liquid Hand Wash
and Bar Soap in 2 variants each were launched under the Palmolive brand as a
major thrust in the Personal Products portfolio.
2004
-The company tied up with IDA to create promote oral health campaign.
2005
-Colgate emerged as a top brand in India.
2006 -Colgate-Palmolive India, the market leader in toothpaste in India,
declared the acquisition of three domestic companies in south India.
2012 -Colgate retained top spot as most trusted brand.
2014 -Too much competition, still company enjoys 49-50% market share.
-Colgate is once again ranked the No.1 ‘Most Chosen Consumer Brand’ in
India.

5. Profit for the last 5 years
Colgate-Palmolive (India) Ltd
₹290
Revenues (₹ cr) Net Profit (₹ cr)
₹403
₹497
₹1,866 ₹2,424 ₹3,374
2008-09 2010-11 2012-13
------Years-----
Net Profit After Tax (₹ cr)
₹600.00
₹500.00
₹400.00
₹300.00
₹200.00
₹100.00
₹0.00
2009-10 2010-11 2011-12 2012-13 2013-14
Financial Highlights
Colgate-Palmolive's stock may be underperforming its peers with competition
nipping at its heels, but analysts are not worried. The company is still the top
oral care brand in India with 55 per cent market share since 1998 - and doesn't
look like it is going to lose the top spot any time soon. Only in the year 2010-11
there has been a slight decrease but that was also because of the global scenario
where the markets all over the world were down. Other than that, Colgate is not
only growing consistently but has also been scaling the business without

6. increasing the size of its balance sheet. Colgate has a strong track record of
delivering value with consistent growth it’s net sales have grown at an annual
rate of 16 per cent for the past five years, earnings per share are up at an annual
19 per cent over the past 10 years and dividend per share has risen at an annual
rate of 21 per cent in the last decade. This is the reason why the shareholders of
Colgate have a big smile on their faces.
The reason Colgate has been able to deliver is because of its use of technology
to create products that continue to improve the quality of life for the consumers
wherever they live.
That’s the reason why the HUL’s entry with the brand “Pepsodent” was also
unable to shake Colgate from its position. With such a high increase in its net
worth and profit making, Colgate is certainly going to do a good business in
coming 5 years.
Reasons for Good Performance
There are several reasons why the above charts are showing the increasing
trend. The company is making stream of innovations which reflects in the
Company’s commitment to growing the oral care category by creating new
segments through innovation and technologically advanced products. The
Company’s strong focus on increasing efficiencies and reducing costs and
innovating to make the premium products for the consumers coupled with
minimal price increases has led to significant increase in its Margin earned.
They provide free toothbrush with 250mg Colgate toothpastes. Also they do
some attractive packing, that also brings customers attention towards the brand.
Colgate always seeks customer attention and it is very important for them to be
connected to the customers. Colgate-Palmolive Company believes in the
concept of being in EVERY PLACE, be it an urban area or a rural area. Colgate
has made itself available in each and every nook and corner of the country. Be it
a super store, departmental store or a kirana shop. They constantly keep
increasing the product penetration towards the rural population. Their main
advertisement activities are done through people working on ground level. They
keep on increasing their network of wholesalers and retailers year by year. They
provide gifts, offers and exciting benefits to their distribution network from time
to time. They track the distribution channels for covering the mass population of
our country. They make emotional relationship between their products and
customers by using different strategies and activities. These activities motivate
people to talk about Colgate with the people around them. These efforts make
them a successful and a constant growth achieving company in India.

7. Sectoral Analysis
The consumer products industry has been growing at a brisk pace in the past
few years backed by constant economic growth and rising rural income.Growth
drivers such as rapid urbanization, evolving consumer lifestyles and emergence
of modern trade have shielded the industry from the slowdown.
 The industry is still urban-centric with majority of the goods being
consumed by urban India. In fact, middle India, comprising of the small
towns, has been growing the fastest across rural and urban segments. As
per Nielsen, the FMCG market size of middle India is set to expand
rapidly over the next two decades. Rural India, where 70% of the
population resides, presents the biggest market potential for the industry.
Due to aggressive distribution reach and low unit cost, rural market size
is expected to expand in the future.
 Consumer goods are retailed through two primary sales channels –
 General Trade
 Modern Trade.
 General trade comprising of the ubiquitous kirana stores is the largest
sales channel forming 95% of overall retail sales. However, growth of
consumer goods through modern trade channel is outpacing the growth of
FMCG products in general trade. Factors such as a comfortable and
modern store experience, access to a wide variety of categories and all
brands under a single roof and tempting value-for-money deals are
attracting consumers towards the organised retail. But modern trade is
still an urban phenomenon in India. Product categories such as packaged
rice, liquid toilet soaps, floor cleaners, breakfast cereals, air fresheners
and mosquito repellent equipment have a higher penetration in modern
trade channel. Modern trade is expected to gain greater importance with
opening up of foreign direct investment in multi-brand retail.
 The implementation of the Goods and Services Tax (GST) is expected to
benefit the sector immensely by reducing the overall taxation. GST aims
to reduce the some effects by replacing a large number of indirect taxes
such as central excise, service tax, VAT and inter-state sales tax with a
single GST rate. Moreover, FMCG companies will be able to optimize
the costs of logistics and distribution in the GST era. This would result in
cost savings by the companies in the market which could be passed on to
the final consumer which would in turn boost the demand. However, the

8. implementation of GST has currently been put on hold by the
Government.
Leading
Players
Growth Analysis
COLGATE
PALMOLIVE
(INDIA) LTD
 Company’s business continues to grow strongly in
double digits.
 Colgate Strong Teeth is a market leader with a share of
around 29% in value terms.
 Company strengthened its leadership position in the
toothpaste category to 57.1 % from 55.4 %.
 Market share in toothbrush category was strengthened
to 42.3 % from 41.3 %.
 Sales for the year increased by 15 per cent at Rs.
3,544.88 crore as against Rs. 3,084.11 crore during the
previous year.
 The toothpaste business registered a very strong
volume growth of 9 per cent during the year.
 Expected benefits from new toothbrush facility in
FY16.
 Colgate has built an extensive oral care portfolio
through constant innovation.
 Lately, the company has been aggressive on extension
of its premium portfolio.
 Colgate has 54.3% market share in India’s Oral Care
Market.
HINDUSTAN
UNILEVER
LIMITED
 HUL’s Pepsodent Germicheck is nowhere near the
market leader Colgate and it’s share is of about 6%.
 Household spending has suffered as high inflation
eclipses city salary rises and a recent drought reduces
rural income.
 Net sales rose 13 percent to Rs. 75.7 billion helped by
product relaunches as well as soaps and detergents.

9.  HULs up-and-running business model is a treat for
investors seeking exposure in the FMCG segment.
 The company has delivered in the past and has the
potential to do better in future. In the small and medium
term.
 Hindustan Unilever's came at sales volume growth
came at 3 percent for the March Quarter in 2014.
 HUL has 23.7% market share in India’s Oral Care
Market.
DABUR INDIA  Home care category reported a 15% growth in 1st
quarter of 2014.
 Digestives category reported over 11% growth during
the period.
 Shampoo business grew over 15%.
 Toothpaste category ended the quarter with an 11%
growth.
 Dabur posted a sales volume growth of 9.4% for the
March quarter in 2014.
 Dabur has 11% market share in India’s Oral Care
Market.
SUPPLIER
POWER
RIVALRY
THREAT OF NEW
ENTRANTS
Rivalry among Organization (Competitor Analysis)
 The Indian FMCG sector is the fourth largest in the economy.
 Intense Competition is there between the organised and unorganised
segments.
 Easy availability of raw materials, cheaper labour costs and presence
across the entire value chain is available.
THREAT OF
SUBSTITUTES
BUYER POWER DEGREE OF RIVARY

10. Key Players :
Colgate Palmolive India Limited, Hindustan Unilever Limited, Dabur India
Limited, Procter & Gamble Hygiene and Health Care Limited, Emami Limited,
Godrej Consumer Products Limited, Nirma Limited.
Key Segments :
 Personal Care
 Household Care
 Food & Beverage
Degree of Rivalry:
 In this industry, rivalry amongst the competitors is very fierce.
 There are scarce customers because the industry is highly saturated and
the competitors are in constant race to snatch their share of market.
 Competition is faced from domestic unorganized players and established
MNC's.
 Market Players use all sorts of tactics and activities like
o Intensive advertising campaigns
o Promotional stuffs.
o Price wars are a common phenomenon.
 Private labels offered by retailers at a discount to mainframe brands act as
competition to undifferentiated and weak brands.
 FIVE MAIN COMPETITIVE STRATEGIES ARE:
·Overall low cost leadership strategy
· Best cost providers strategy
· Broad differentiation strategy
· Focused low cost strategy
· Focused differentiation strategy
 Here competitive strategy varies from sector to sector and company to
company. Thus, it is not easy to predict a single or to find a single
strategy for the whole sector. When we come on to FMCG Sector main
strategies lay behind market strategies, cost, and quality strategies.
Buyer Power
 In FMCG industry the switching costs of most of the goods is very low
particularly in Household Care, Food & Beverage segments so there is no

11. threat of buying one product over other. So the customers are also not
reluctant to buy or try new things off the shelf.
 Customer does not have bargaining power in case of branded products
but intense competition within the FMCG companies results in value for
money deals for consumers (e.g. buy one, get one free concept).
Threat of New Entrants
Barriers to entry :
 Huge investments in setting up distribution networks and promoting
brands and competition from established companies.
 FMCG Industry does not have any measures which can control the
entry of new firms.
 The resistance is very low and the structure of the industry is so
complex that new firms can easily enter and also offer tough
competition due to cost effectiveness.
 Hence potential entry of new firms is highly viable.
Supplier Power
 Inputs being mostly agri-commodities, the suppliers are numerous and
lack scale to wield bargaining power.
 Companies like ITC that are integrated backwards have lower
dependence on suppliers.
 The bargaining power of suppliers of raw materials and intermediate
goods is not very high. There is ample number of substitute suppliers
available and the raw materials are also readily available and most of the
raw materials are, homogeneous.
 There is no monopoly situation in the supplier side because the suppliers
are also competing among themselves.
 Supply : Abundant supply through a distribution network of over 8 m
stores across the country. Distribution networks are being beefed up to
penetrate the rural areas.
 Demand : Being items of daily consumption, demand is least impacted
by economic slowdown.
Threats of Substitutes
 There are complex and never ending consumer needs and no firm can
satisfy all sorts of needs alone.
 There are plenty of substitute goods available in the market that can be
re-placed if consumers are not satisfied with one.

12.  The wide range of choices and needs give a sufficient room for new
product development that can replace existing goods. This also leads to
higher consumer’s expectation.
Conclusion in Tabular Form :
Forces High Medium Low
Intensity of
competition
Bargaining
power of buyer
Bargaining
power of
supplier
Threats from
substitute
Threats from
new entrants