ABSTRACT

The analysis of financial statements and their accompanying notes

explains a company’s past and current financial performance,
financial statements analysis involves a comparison of a firm’s
performance with that of other firms in the same line of business,
which often is identified by the firm’s industry classification. Financial
statements are used in several ways; to evaluate a company’s overall
performance, identify strengths and weaknesses, anticipate future
successes or problems, and ultimately help to decide if the company
has good investment opportunity.
The financial statement analysis applies tools, analytical techniques
and required methods for business analysis. It is a diagnostic tool for
evaluating financing activities, investment activities and operational
activities as well as an assessment tool for management decisions
and other business decisions.
The main aim of the study is analyzing the financial statements of
(PROCTER & GAMBLE)which is an American based FMCG company
to compare its current and past performance with its competitors.

KEYWORDS: financial analysis, financial reports, decision-making,

profitability, liquidity.
TABLE OF CONTENT

CHAPTER CONTENT PAGE

NO: NO.
ACKNOWLEDGEMENT
DECLARATION
ABSTRACT
CHAPTE INTRODUCTION
R NO-1 1.1- INTRODUCTION
1.2- NEED OF THE STUDY
1.3- SCOPE OF THE STUDY
1.4- OBJECTIVES OF THR
STUDY
1.5- RESEARCH
METHODOLOGY
1.6- LIMITATIONS OF THE
STUDY
CHAPTER RESEARCH
NO-2 METHODOLOGY
CHAPTER REVIEW OF LITERATURE
NO-3
CHAPTER 1
INTRODUCTION
The aim of the study is analyzing the financial statements of P&G
(PROCTER & GAMBLE) and its current and past performance withs its
competitors in this line of business. The company manufactures and
sells household products, consumer goods and personal care items
with notable brands including Crest,Tide,Pampers,head&shoulders
etc.
Financial statements analysis is a process of selection, relation
evaluation of a financial statement. The first procedure is to select
from the total information available about a business enterprise. The
second procedure is to arrange the information in a way that will
bring out significant relationships. The final procedure is to study
these relationships and interpret the results. Modern technology has
provided opportunities to investors to move their funds from one
market to another market around the world. Strong financial
position of a company helps to attract investors. The more the
financially strong a company, the more company is wealthy. There
are two kinds of users of financial statement. Those are internal and
external users. Management of a company evaluates their financial
statements end of each financial year to understand their business
activity. Even each division of a company frequently compares the
performance of those divisions by using financial statements
information. Based on the financial statements analysis management
take decisions about financing, investing and future planning
decisions.
Financial statements analysis is also important to external users.
There external users are short term creditors, long time creditors,
investors, suppliers, customers, government, agencies. Financial
statements are a primary source of information about a firm’s
financial health and its future prospects, Investors and creditorsmake
their investing and credit decision after analyzing company’s
financialstatements. Public owned companies’ financial statements
need to be audited each year by government authorized bodies and
all certified statements have to send to all stock holders and to
Securities and Exchange Commission. During preparing the project all
information has been collected from Library research, Internet
sources and accounting lecture notes.
NEED OF THE STUDY

Financial analysis is needed for various purposes and is very

important for any organisation. Financial Analysis is needed
to:
 Measure the profitability and earning potential of a
business.
 Measure the financial strength of the business.
 Comparative study.
 Efficiency of management.
 Useful to management.
 Analyse the short-term and long-term solvency.
 Reasons for Deviation.
 It is essential for complying with regulatory requirements.
 It is an important tool for communicating financial
information.
SCOPE OF THE STUDY

 Financial statement analysis is a process of reviewing and

analyzing a company’s financial statements (balance sheet,
income statement, and flow statement) to gain insights into its
financial performance, position, and cash flow.
 It is used by investors, creditors, analysts, managers, and other
stakeholders to make informed decisions about the company’s
financial health and future prospects.
 Financial statement analysis involves examining the company’s
financial ratios, such as profitability ratios, liquidity ratios, and
solvency ratios, to evaluate its financial performance.
 It also involves analyzing the company’s financial statements to
identify trends and patterns, such as changes in revenue,
expenses, and cash flow over time.
 Financial statement analysis can be used to compare a
company’s financial performance to that of its peers, industry
standards, and historical performance.
 It can also be used to assess the company’s financial risk and to
identify potential areas of concern or opportunities for
improvement.
 The scope of financial statement analysis may vary depending
on the purpose and the audience of the analysis: For example,
a credit analyst may focus more on the company’s liquidity and
debt-paying ability, while an equity analyst may focus more on
the company’s profitability and growth prospects.
OBJECTIVES OF THE STUDY

 Evaluate the financial health of a company.

 Asses the company’s profitability and growth potential.
 Analyse the company’s liquidity and solvency.
 Measure the efficiency of the company’s operations and
asset utilization.
 Identify the company’s financial risks and opportunities.
 Compare the company’s financial performance with its
peers and industry benchmarks.
 Assist in investment decision-making and portfolio
management.
 Facilitate the creditworthiness evaluation of the
company for lending institutions.
 Provide insight into the company’s financial
management and strategy.
 Support the company’s decision-making process
through financial analysis and forecasting.
LIMITATIONS OF THE STUDY

Since financial analysis relies entirely upon the data

recorded in the financial statements, it suffers from
the limitations inherent in financial statements. These
are:

1. Financial analysis ignores price level changes since it is

based on the historical cost concept of accounting.
2. Qualitative aspects, such as the quality of employees
and management, etc., are overlooked since financial
statements only keep records of quantitative aspects of
the transactions.
3. Financial statements often involve personal bias,
judgements, and prejudices of the accountant. Hence,
the results of the analysis of such biased statements are
not fair.
4. Provide only a limited view of a company’s operations
and do not capture non-financial factors.
5. Limited timeliness, as financial statements are typically
published on a quarterly or annual basis and may not
reflect the most up-to-date information.
CHAPTER 2
RESEARCH METHODLOGY

MEANING OF RESEARCH:
 Research is a diligent and systematic inquiry or
investigation into a subject in order to discover or revise
facts, theories, applications, etc…
 Research is defined as the creation of new knowledge
and/or the use of existing knowledge in a new and
creative way so as to generate new concepts,
methodologies and understandings.

MEANING OF METHODLOGY:
 A system of methods used in a particular area of study
or activity.
 Methodology is the system of methods followed by a
particular discipline.

WHAT IS RESEARCH METHODLOGY?

 Research methodology is the systematic approach used
by researchers to conduct scientific investigations and
gather relevant data in order to answer research
questions or test hypotheses. It involves the selection
and application of various research methods,
techniques, and tools that are appropriate for the
research question and the type of data being collected.
  The research methodology is essential to ensure that
the research is conducted in a systematic and rigorous
manner, and that the results obtained are reliable and
valid.

METHODS OF DATA COLLECTION:

There are several methods of data collection, including:
 PRIMARY DATAanalysis refers to the process of analyzing data that
has been collected by a researcher or research team. This type of data
collected through surveys, interviews, focus groups, observations,
experiments etc…
 SECONDARY DATA analysis involves analyzing existing data that has
been collected by someone else, such as government statistics, company
reports, case studies, books, academic studies etc…
Here, the collection of is mainly done by secondary data through company
reports, case studies, news articles, some statistics etc…
METHODLOGY USED IN THIS RESEARCH:
The research methodology for financial statement analysis typically involves
the following steps:
STEP 1:Identify the research:
In the first step I have chosen Procter & Gamble company which is an
American based FMCG company I will be analyzing their financial statements
from past 3 years.
STEP 2:Gathering financial statements:
In this step I will be gathering the financial statements or annual reports
through the Procter & Gamble’s own website and NASDAQ (National
Association of Securities Dealers Automated Quotations) website.
STEP 3:Analyse financial statements:
In this step I will be analyzing the gathered financial statements or annual
reports of the company like company’s Revenue, Net Profits, Assets, Liabilities,
and also calculating ratios such as ROI (Return on investments), debt-to-equity
ratio, and earnings per share etc…
STEP 4:compare to industry benchmarks:
In this step I will be comparing the company’s reports to industry benchmarks
and to its competitors in the same market industry.
STEP 5:Drawing conclusions:
In this final step I will be getting the conclusions based on the analysis of
financial statements about the company’s financial health and performance.
This may involve strengths, weaknesses, opportunities, and threats.

Overall, the research methodology for financial statement analysis involves a

combination of quantitative analysis and industry research to gain insights into
a company’s financial health and performance.
CHAPTER 3
Here are some case studies related to Procter and
Gamble’s financial statements analysis:

1. Procter & Gamble : A Case Study in Financial Analysis - This case study
by Andrew Ross Sorkin in the New York provides an overview of Procter
7 Gamble’s financial performance, including analysis of it’s income
statement, balance sheet, and cash flow statement. The article also
explores the impact of the company’s growth strategies on its financials .

2. Procter & Gamble : Analyzing the Financial Statement-This case study by

Eric Noreen and Peter C.Brewer in the textbook Managerial Accounting
for Mnagers provides an in-depth analysis of Procter & Gamble’s
financial statements, including a review of the company’s accounting
polices and financial ratios .

3. Procter & Gamble : Financial Ratio Analysis – This case study by Michael
H. Moffett in the textbook International Financial Management provides
an analysis of Procter & Gamble’s financial ratios, including liquidity
ratios, profitability ratios, and debt ratios. The case study also explores
the implications of the company’s financial ratios for it’s international
operations .

4. Procter & Gamble : This case study by Sandeep Biswas and Vinod K. Jain
in the Journal of Business Case studies provides a comprehensive
analysis of Procter & Gamble’s financial statements, including a review
of the company’s financial performance over the past five years. The
case study also includes a discussion of the company’s growth prospects
and risks .
P&G Hygiene and Health Q1 profit dips 29.3% to Rs
154.4 crore, revenue down 1.3% to Rs 1,044.9 crore
Revenue from operational fell 1.26 percent to Rs 1,044.89 crore during the
quarter under review. In the year-ago period, the same stood at Rs 1,058.30
crpre, Procter & Gamble Hygiene and Health Care Ltd (PGHH) said in a
regulatory filing . New Delhi: Procter & Gamble Hygiene and Health Care Ltd
has reported a 29.26 percent decline in profit after tax at Rs 154.41 crore in
the first quarter ended September due to higher commodity costs and decline
in sales .

P&G Hygiene and Health Care q2 profit dips 2%

to Rs 207 cr as costs surge
The company declared an interim dividend of 80 rupees per equity share
CHENNAI/BENGALURU (Reuters) – India’s Procter & Gamble Hygiene and
Health Care Ltd reported a drop in second-quarter profit, hit by higher cost of
commodities and a slowdown in the broader fast-moving consumer goods
(FMCG) sector in the country . Demand for health and hygiene goods has
slowed from COVID lockdown-highs, while customers are also snubbing big
brands for cheaper consumer goods in the face of high living cost.

P and G Standalone December 2022 Net Sales at Rs

1,137.39 crore, up 4.065 Y-o-Y
Reported Standalone quarterly numbers for Procter and Gamble Hygiene and
Health Care are: Net Sales at Rs 1,137.39 crore in December 2022 up 4.06%
from Rs.212.06 crore in December 2021. EBITDA stands at Rs. 299.80 crore in
December 2022 down 1.16% from Rs. 303.33 crore in December 2021. P and G
EPS has decreased to Rs. 63.91 in December 2022 from Rs. 65.33 in December
2021. P and G shares closed at 14,171.95 on January 31,2023 (NSE).
P&G India net profit down 18% in 2021-2011 as input
costs bite
Sales of the world’s largest consumer goods maker Procter & Gamble (P&G) in
India grew 8% year-on-year in 2021-22 while net profit fell 18%, indicating
pressure on input costs even after it increased prices. The Cincinnati-based
consumer goods maker reported sales of Rs 13,985 crore and net profit of Rs
1,334 crore across Indian companies – pharmaceuticals firm P&G Health,
shaving products maker Gillette, P&G Health & Hygiene and P&G Home
Products.

Procter & Gamble revenue and profit fall as company

looks to higher prices to looks to higher prices to offset
declining sales
KEY POINTS
 Procter & Gamble reported falling revenue and profit, as higher prices
struggled to offset dropping sales volumes and foreign exchange
headwinds.
 All of the company’s divisions reported declining sales volume in the
quarter
 The company slightly lifted it’s outlook for 2023 sales growth to a range
of 4% to 5%

P&G sees new options for growth, innovation

Mumbai: India is at the point of inflection that is generation new opportunities
for growth and product innovation, The Procter & Gamble Company (P&G)
COO Shailesh Jejurikar has said. He further added that India was more than just
a flavour of the world. In his first exclusive interaction since he became COO of
the $80-billion American consumer products multinational on October 1,2021,
Jejurikar told TOL India figures in the top 10 markets for P&G globally, and it
continues to grow in size.
Here’s A Better Pick Over Procter & Gamble Stock
We believe that Estee Lauder stock (NYSE:EL) is a better pick over its industry
peer Procter & Gamble stock (NYSE: PG), given its better prospects. Estee
Lauder stock is trading at 5.5x trailing revenues compared to 4.5x for P&G.
Investors have assigned a higher valuation multiple to EL stock, given its better
financial position. If we look at stock returns, both stocks have seen around a
5% fall in the 6% fall for the broader S&P500 Index.

Procter & Gamble: Why Own The Stock In 2023

Summary
 The macroeconomic headwinds throughout 2022 are clearly reflected in
the Q4 results. Both the unfavourable FX environment and the
inflationary pressure had negative impacts.
 In 2023, we expect the macroeconomic environment to normalise,
which could have a positive impact on PG’S net profit margin and
therefore on the return on equity.
 We would like to see the firm’s liquidity ratios improving in the coming
quarters, as they have been trending downwards in the recent years.
 For these reasons, they maintain their “buy” rating.

Who are Procter & Gamble’s main Competitors?

Consumer goods are goods that are sold directly to consumers. They can be
used for personal, recreational, or corporate use, and are classified in three
different ways. The first category is services, which include things like haircuts
and car washes. The second is the durable goods sector, which includes
products that don’t necessarily have a shelf life-think of things like haircuts and
car washes. The second is the durable goods sector, which includes products
that don’t necessarily have a shelf life-think of things like books, appliances,
and cars.
Our strategy across markets is based on the ‘5 vectors of
superiority’: Sahil Sethi of P&G India
In an exclusive interaction with BestMediaInfo.com, Sahil Sethi, Senior
Marketing Director and Category Leader- Health Care, P&G India, emphasised
that a good night’s sleep is an unmet need to many Indians even today and
therefore P&G decided to foray into the sleep aids market to help Indian
consumer get the rest they deserve.

Higher prices help Procter & Gamble offset commodity

costs, but Tide maker warns of more challenges
Procter & Gamble reported mixed quarterly results as the consumer products
giant faced rising commodity costs and warned it expects such headwinds to
persist in its fiscal 2023.
Here’s what the company reported compared with what Wall Street was
expecting, based on a survey of analyst by Refintiv:
 Earnings per share: $1.21 adjusted vs.$1.22 expected
 Revenue: $19.52 billion vs.$19.4 billion expected.

P&G raises sales forecast on price hikes, sees pressure

on profit
Tide detergent maker Procter & Gamble Co raised its full-year sales forecast on
Thursday on the back of increased prices, even as it warned of high commodity
costs pressuring profits. P&G, like other consumer goods companies, has
implemented multiple price increase over the last few months.

Procter & Gamble raises sales outlook but higher costs

hit Q2 profits
Procter & Gamble Co, the maker of Crest toothpaste and Charmin toilet paper,
raised its ful-year sales outlook, though the consumer products giant cautioned
that higher commodity prices continue to squeeze profits.The upgrade
outlook, issued Thursday, came as the Cincinnati-based company reported
lower fiscal second-quarter earnings and sales .
A Look at the fair value of the Procter & Gamble
Company(NYSE:PG)
Key Insights
 Procter & Gamble’s estimates fair value is US$149 based on 2 stage Free
Cash Flow to Equity
 Current share price of US$151 suggests Procter & Gamble is trading
close to its fair value
 Analyst price target for PG is US$153 which is 1.8% above our fair value
estimate

Procter & Gamble Health 2021-22 Annual Report

Analysis
Procter & Gamble Health Income Statement Analysis
 Operating income during the year rose 10.5% on a year-on-year basis.
 The company’s operating profit increased by 8.8% YoY during the fiscal.
Operating profit margins witnessed a fall and stood at 24.0% in FY as
against 24.4% in FY.
 Depreciation charges decreased by 9.9% and finance costs decreased by
47.5% YoY, respectively.
 Net profit for the year grew by 8.9% YoY.
 Net profit margins during the year declined from 17.5% in FY to 17.3% in
FY.

P&G Earnings Slip as Higher Prices Sap Sales Volumes

After lifting prices to new heights, Procter & Gamble Co. PG 0.11 reported
lower quarterly profit and declining sales volumes as the rising costs of Tide
detergent and other staples prompted consumers to cut back on purchases at
the end of 2022. P&G increased prices by 10% in the period, helping the
company report at 5% boost in organic sales, which exclude currency swings
and acquisitions.
CHAPTER 4
Financial statement analysis involves examining a company’s financial
statements in order to gain insights into its financial health and performance.
There are several theories related to financial statement analysis, including:
1. Efficient Market Hypothesis Theory (EMH): EMH suggests that stock
prices reflect all publicly available information, including information
contained in financial statements. Therefore, accrding to this theory, it is
impossible to consistently outperform the market through financial
statement analysis.

2. Agency Theory: Agency theory suggests that conflicts of interest can

arise between managers and shareholders, and financial statement
analysis can be used to detect such conflicts. For example, managers
may manipulate financial statements to make the company appear more
profitable than it actually is, to receive higher compensation or maintain
control over the company.

3. Signaling Theory: Signaling theory suggests that financial statements can

be used by managers to signal the company’s financial health to external
parties, such as investors and creditors. For example, if a company has
strong financial statements, it may signal that the company is a good
investment or is creditworthy.

4. Stakeholder Theory: Stakeholder theory suggests that a company has a

responsibility to consider the interests of all stakeholders, including
employees, customers, suppliers, and the community. Financial
statement analysis can be used to assess the impact of the company’s
activities on its stakeholders and evaluate the company’s performance
from a broader perspective.

5. Market-based Accounting Research (MBAR): MBAR is a research

approach that combines financial statement analysis with stock market
data to investigate the relationship between accounting information and
stock prices. This approach is used to test various hypothesis related to
 financial statement analysis, such as the relationship between earnings
quality and stock returns.
6. The Fundamental Analysis Theory: This hypothesis suggests that by
analyzing a company’s financial statements, an investor can identify
undervalued or overvalued stocks and generate superior returns.
Fundamental analysis involves examining financial statements to assess
a company’s financial health, growth prospects, and competitive
position .
Overall, financial statement analysis is a powerful tool for investors and
analysis to gain insights into a company’s financial health and performance,
and to make informed investment decisions.
The theoretical framework of financial statement analysis involves several key
steps and concepts, which can be represented using flow charts. Here is a
possible flow chart for financial statement analysis:

1. Obtain financial statements;

a. Identify the company or companies whose financial statements you
want to analyze.
b. Obtain their financial statements, including the balance sheet, income
statement, and cash flow statement.

2. Understand accounting principles and standards:

a. Familiarize yourself with the generally accepted accounting principles
(GAAP) or international finance reporting standards (IFRS) used by the
company.
b. Review any significant accounting polices used by the company.

3. Analyze financial ratios:

a. Calculate and analyze key financial ratios, such as liquidity, profitability,
solvency, and efficiency ratios.
b. Compare the ratios to industry averages, historical data, and
benchmarks to identify trends and areas of concern.
 4. Analyze income statement:
a. Analyze the income statement to understand the company’s revenue
sources, cost structure, and profitability.
b. Identify any significant changes or trends in revenue, expenses, gross
profit margin, operating profit margin, and net profit margin.

5. Analyze the balance sheet:

a. Analyze the balance sheet to understand the company’s assets,
liabilities, and equity.
b. Identify any significant charges or trends in Key balance sheet items,
such as cash, accounts receivable, inventory, accounts payable, long-
term debt, and shareholder equity.

6. Analyze cash flow statement:

a. Analyze the cash flow statement to understand the company’s sources
and use of cash.
b. Identify any significant changes or trends in cash flows from operating
activities, investing activities, and financing activities

7. Draw conclusions and make recommendations:

a. Synthesize the findings from the financial statement analysis.
b. Draw conclusions about the company’s financial performance, strengths,
weakness, opportunities, and threats.
c. Make recommendations for improvements or changes in the company’s
financial strategy, operations, or management.

Overall, financial statement analysis is a critical tool for investors, analysts,

lenders, and other stakeholders to understand a company’s financial
performance and prospects. By using a systematic approach and a theoretical
framework, analysts can identify key trends and issues and make informed
decisions about the company’s future prospects.
Flow Charts:
ADVANTAGES AND DISADVANTAGES OF THE STUDY
Financial statement analysis is the process of reviewing and analyzing a
company’s financial statements to make informed business decisions. Like any
method or technique, there are advantages and disadvantages associated with
financial statement analysis.
Advantages:
1. Helps in decision-making: Financial statement analysis helps in decision-
making, such as evaluating the financial health of a company, identifying
areas of improvement, and making informed investment decisions.

2. Facilitates forecasting: Financial statement analysis can help predict

future performance by reviewing the past performance of a company

3. Assist in comparing companies: Financial statement analysis help to

compare the financial performance of companies within the same
industry, making it easier to identify market leaders and laggards.
 4. Aids in identifying trends: Financial statement analysis helps to identify
trends in a company’s financial performance, which can help in
identifying areas that need improvement.

5. Helps in identifying financial strength and weakness: Financial

statement analysis helps in identifying a company’s financial strength
and weakness, which can guide decision-making regarding investment
opportunities.

Disadvantages:
1. Dependent on financial reporting quality: Financial statement analysis
relies on accurate and reliable financial reporting, and any
misrepresentation or manipulation in financial statements can result in
flawed analysis.

2. Limited information: Financial statements provide only a limited view of

a company’s operations and financial performance, which may not give a
complete picture of the company’s situation.

3. Limited comparability: Comparing financial statements of companies

within the same industry may not be feasible due to variations in
accounting policies and practices.

4. Historical data: Financial statement analysis relies on historical data, and

it may not always be an accurate indicator of future performance.

5. Limited analysis for small companies: Financial statement analysis may

not be effective for smaller companies, which may have simpler financial
statements that do not provide adequate data for analysis.

In conclusion, while financial statement analysis is useful tool, it has limitations

and may not provide a complete picture of a company’s financial situation.
Therefore, it is crucial to consider other factors such as market trends, business
strategy, and industry analysis when making financial decisions.
OUTCOMES OF THE STUDY
The analysis of financial statements can provide valuable insights into a
company’s financial health and performance. Some of the key outcomes of
such an analysis include:
1. Assessment of profitability: Financial statement analysis can help assess
a company’s profitability by examining its income statement and
determining its revenue, cost of goods sold, and net income.

2. Evaluation of liquidity: Liquidity refers to a company’s ability to meet its

short-term obligations. Financial statement analysis can help evaluate a
company’s liquidity by examining its balance sheet and determining its
current assets, current liabilities, and working capital.

3. Identification of trends: By analyzing financial statements over multiple

periods, trends can be identified in a company’s financial performance,
such as revenue growth or declining profitability.

4. Assessment of financial risk: Financial statement analysis can help

assess a company’s financial risk by examining its debt levels, interest
expense, and creditworthiness.

5. Benchmarking against competitors: Financial statement analysis can

help benchmark a company’s financial performance against its
competitors, allowing for a more informed comparision of its financial
health and performance.

Overall, the outcomes of financial statement analysis can provide important

insights into a company’s financial health and performance, which can be
useful for decision-making by investors, creditors, and other stakeholders.
CHAPTER 5
 INTRODUCTION

TYPE OF INDUSTRY FMCG (FAST MOVING CONSUMER GOODS) INDUSTRY.

TYPE OF COMPANY MULTINATIONAL CONSUMER GOODS CORPORATION.
FOUNDERS’S WILLIAM PROCTER AND JAMES GAMBLE.
KEY PEOPLE CHAIRMAN & DIRECTOR – JON MOLLER.
FOUNDED 31 October 1837, Cincinnati, Ohio, United States.
COMPANY’S WEBSITE us.pg.com

OVERVIEW OF THE PROCTER & GAMBLE (P&G) :

The procter & Gamble Company (P&G) is an American multinational consumer
goods corporation headquarted in Cincinnati, Ohio, founded in 1837 by
William Procter and James Gamble and James Gamble. It specializes in a wide
range of personal health/consumer health, personal care and hygiene
products; these products are organized into several segments including
beauty; grooming; health care; fabric and home care; and baby, feminine, and
family care. Before the sale of Pringles to Kellog’s, its product portfolio also
include food, snacks, and beverages, P&G is incorporated in Ohio.
In 2014, P&G recorded $83.1 billion in sales. On August 1,2014, P&G
announced it was streamlining the company, dropping, and selling off around
100 brands from its product portfolio in order to focus on the remaining 65
brands, which produced 95% of the company’s profits. A.G.Lafley, the
company’s chairman and CEO until October 2015, said the future P&G would
be “a much simpler, much less complex company of leading brands that’s
easier to manage and operate”.

LOGO OF P&G (PROCTER & GAMBLE):

P&G’S former logo originated in 1851 as a crude cross that barge workers on
the Ohio River painted on cases of P&G star candles to identify them. P&G
later changed this symbol into a trademark that showed a man in the moon
overlooking 13 stars, said to commemorate the original Thirteen Colonies.

Logo since 2013, with the current lettermark that has been used since 2003.
 HISTORY OF P&G COMPANY:
Candlemaker William Procter, born in England, and soap maker James Gamble,
born in Ireland, both emigrated to the US from the United Kingdom. They
settled in Cincinnati, Ohio, initially and met when they married sisters Olivia
and Elizabeth Norris. Alexander Norris, their father-in-law, persuaded them to
become business partners, and in 1837, Procter & Gamble was created.
In 1858-1859, sales reached $1 million. By that point, about 80 employees
worked for Procter & Gamble. DURING THE American Civil War, the company
won contracts to supply the Union Army with soap and candles. In addition to
the increased profits experienced during the war, the military contracts
introduced soldiers from all Over the country to Procter & Gamble’s products.
The company began to build factories in other locations in the united states
because the demand for products had outgrown the capacity of the Cincinnati
facilities. The company’s leaders began to diversify its products as well, and in
1911 began producing Crisco, a shortening made of vegetables oils rather than
animal fats.
Beginning in the 1880s. P7G advertised its wares in full – page advertisements
in many general-interest magazines; by 1921, it had become a major
international corporation with a diversified line of soaps, toiletries, and food
products; in that year, its annual advertising budget reached $1 million.

POLICIES & PRACTICES OF P&G

P&G’s policies for business conduct flow from our purposes, values, and
principles. Our policies are aspirational statements of the application of our
purpose, values and principles to broad, major issues and societal
expectations. While P&G competes hard to achieve leadership and business
success, the company is concerned not only with results, but with how those
results are achieved. We will never condone nor tolerate efforts or activities to
achieve results through illegal or unethical dealings anywhere in the world.
Click to learn more about a a specific Procter & Gamble policy.
 MISSION, VALUES AND PRINCIPLES OF P&G COMPANY:
Taken together, our purpose, values and principles are the foundation for
P7G’s unique culture. Throughout our history of over 180 years, our business
has grown and changed while these elements have endured, and will continue
to be passed down to generations of P&G people to come. Our purpose unifies
us in a common cause and growth strategy of improving more consumer’s lives
in small but meaningful ways each day. It inspires P&G people to make a
positive contribution every day. Our values reflect the behaviour’s that shape
the tone of how we work with each other and with our partners and our
principles articulate P&G’s unique approach to conducting work every day.

MISSION:
We will provide branded products and services of superior quality and value
that improve the lives of the world’s consumers, now and for generations to
come. As a result, consumers will reward us with leadership sales, profit and
value creation, allowing our people, our shareholders and the communities in
which we live and work to prosper.

VALUES:
 Integrity.
 Leadership.
 Ownership.
 Passion for winning.
 Trust.

PRINCIPLES:
 We show respect for all individuals.
 The interests of the company and the individual are inseparable.
 We are strategically focused in our work.
 Innovation is the cornerstone of our success.
 We value mastery.
 We seek to be best.
 We are externally focused.
 Mutual interdependency is a way of life.
 VISION OF P&G COMPANY:
“TO BE THE BEST CONSUMER PRODUCTS AND SERVICES
COMPANY IN THE WORLD”.

BRANDS UNDER P&G (PROCTER & GAMBLE):

PRODUCTS OF P&G:
 Baby Care
 Fabric Care
 Family Care
 Feminine Care
 Grooming
 Hair Care
 Home Care
 Oral Care
 Personal Health Care
 Skin & Personal Care

RECOGNITIONS AND ACHIEVEMENTS:

As a leading Global company, P&G has received various wards and recognitions
from organisations, associations and publications. Included below is a sample
of awards that P&G has received within the most recent years.
ORGANIZATIONAL STRUCTURE:
SWOT Analysis of Procter and Gamble (P&G):
Strengths:
 Research and development: Procter and Gamble (P&G) research every
little detail before developing particular product. Thus, it is its strength
and a reason behind its success.
 Global presence: The company markets its products everywhere, and
thus it has a far better reach in the market than many of its competitors.
Their global market makes their products one of the most extensively
used ones.
 Brand Equity: P&G is very successful in holding brands that have high
brand value in themselves. Brands like Gillett, Ariel, and Duracell are all
market leaders and can bring high-profit rates for P&G.
 Brand Reputation: P&G never faced any failing business due to its
marketing technique and reputation. Therefore, it is a given that they
have very high profits and that they earn good revenue.

Weakness:
 Closure of brands caused loss: Even though the company is doing pretty
well, many subsidiary brands under the company no longer exists. The
best example would be Pringles and how Kellogg’s bought it. This closure
of brands has resulted in some losses faced by the company.
 Unable to keep up with the frequent change in demand: When it comes
to consumer goods, it is a given that the public demand for the product
would change quite frequently. Procter and Gamble (P&G) Sometimes
face problems while keeping up with the continuous shift of this public
demand. It can be a weakness on the company’s part.
 Low organic growth: Due to the slow increase in the customer base due
to reaching the saturation curve and the lower rate of innovation, P&G is
facing a lower rate of organic growth. Therefore, P&G needs to invest in
a few unique marketing tactics to get out of this.
  Slow decision-making due to the company structure: The company has
many heads and managerial positions, and making a decision is not a
one-person job when it comes to procter and Gamble (P&G). So, the
involvement of so many people cause a few delays in the decision-
making process.

Opportunities:
 Chance to increase the organic growth: Due to its current lower rate of
organic growth, P&G has a way to increase its organic growth by doing
some good marketing and producing some newer products in the
market.
 Reach the rural market: Even though P&G is available in most markets,
there are specific rural markets that they have not yet entered. So, this
can be an opportunity for them to explore another market for more
profit and revenue.
 Mergers and acquisitions: Mergers with popular companies can make
another company even more popular than they already are and earn
them more customers. Hence, profit. P&G’s acquisitions are pretty
successful, giving them good opportunities in the market.
 Higher purchasing capability: The purchasing capability of consumers
has increased a lot over the years, and one can say that it will increase
even more. It directly affects companies like P&G because the higher the
purchasing capability, the higher their profits.

Threats:
 High competition: Consumer goods is a sector that has avery high
competition level. P&G does not only have to face popular brands like
Johnson and Johnson only, but there are also local brands who are trying
to steal the market as well, and thus, P&G has to keep up with all kinds
of competitors.
 Increased prices of raw materials: Customers may consider it a red flag
when the leading management heads leave their posts at a highly
successful company like procter and Gamble (P&G). It can put a dent in
their reputation and name.
  Buyer control: P&G operates in the market of consumer goods. Thus, it
is natural that the buyers control its operations. Everything related to
the company, including profit and revenue, highly depends on the
buyers and their demands and tastes. With a slight change in their
mindset, the company can face massive losses or gain a lot.

 Strict rules and regulations: Government rules and regulations should

be maintained at all costs. If P&G fails to do so, it will have problems
with the law, which is never a good thing whwn it comes to business
because it affects the reputation of the company, and the public loses
faith in the company.

Procter and Gamble (P&G) SWOT Analysis Diagram: