1|Page

INDEX

NO.

PARTICULARS

PAGE NO.

1.

HISTORY OF THE COMPANY

2.

COMPANYS BACKGROUND

INTERNATIONAL EXAPATION

COMPANY OVERVIEW

11

DIRECTORS REPORT

13

BUSINESS PERFORMANCE

14

AUDIT REPORT

22

RATIO ANALYSIS

26

PROFIT & LOSS ACCOUNT

86

10

BALANCE SHEET

89

11

COMMON SIZE STATEMENT

92

12

CASH FLOW STATEMENT

96

13

CONCLUSION

100

14

BIBLIOGRAPHY

101

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HISTORY OF THE COMPANY

Public Company
Incorporated: 1806 as The Colgate Company
Employees: 36,000
Sales: $19.45 billion (2009)
Stock Exchanges: New York Euro next Frankfurt London Zurich Ticker Symbol: CL
NAIC: 311111 Dog and Cat Food Manufacturing; 325611 Soap
and Other Detergent Manufacturing; 325612 Polish and Other Sanitation Good Manufacturing;
325620 Toilet Preparation Manufacturing; 325998 All Other Miscellaneous Chemical Product and
Preparation Manufacturing; 335211 Electric House wares and Household Fan Manufacturing;
339994 Broom, Brush, and Mop Manufacturing
Colgate-Palmolive Company's growth from a small candle and soap manufacturer to one of the
most powerful consumer products giants in the world is the result of aggressive acquisition of
other companies, persistent attempts to overtake its major U.S. competition, and an early
emphasis on building a global presence overseas where little competition existed. The company is
organized around four core segmentsoral care, personal care, home care, and pet nutrition
that market such well-known brands as Colgate toothpaste, Irish Spring soap, Soft-soap liquid
soap, Mennen deodorant, Palmolive and Ajax dishwashing liquid, Ajax cleanser, Murphy's oil
soap, Fab laundry detergent, Soup line and Suavity fabric softeners, and Hill's Science Diet and
Hill's Prescription Diet pet foods. Colgate-Palmolive has operations in more than 200 countries
and generates about 70 percent of its revenue outside the United States. Bayard Colgate as
president in 1933.

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International Expansion
Colgate & Company had been a pioneer in establishing international operations, creating a
Canadian subsidiary in 1913 and one in France in 1920. In the early 1920s the firm expanded into
Australia, the United Kingdom, Germany, and Mexico. Colgate or its successor firm next created
subsidiaries in the Philippines, Brazil, Argentina, and South Africa in the late 1920s. In 1937 the
company moved into India and by the end of the 1940s had operations in most of South America. By
1939 Colgate-Palmolive-Peet's sales hit $100 million.
In the 1940s and 1950s the company also built upon its strategy of growth by acquisition, buying up a
number of smaller consumer product companies. Organic growth remained on the agenda as well, and in
1947 the company introduced two of its best-known products, Fab detergent and Ajax cleanser. These
acquisitions and new products, however, did little to close the gap between Colgate and its arch-rival,
the Procter & Gamble Company, a firm that had been formed in the 1830s and had by now assumed a
commanding lead over Colgate in selling detergent products in the United States. Meanwhile, the firm
adopted its present name in 1953 and moved its offices for domestic and international operations to New
York City in 1956.
In 1960 George H. lest was appointed Colgate's president in the hopes that his international experience
would produce similar success in the domestic market. Under his leadership, the company embarked
upon an extensive new product development program that created such brands as Cold Power laundry
detergent, Palmolive dishwashing liquid, and Ultra Bite toothpaste. In an attempt to expand beyond
these traditional, highly competitive businesses into new growth areas, Colgate also successfully
introduced a new food wrap called Baggies in 1963. As a result of these product launches, the company's
sales grew between 8 and 9 percent every year throughout the 1960s. Sales topped the $1 billion mark in
1967.
Lest assumed the chairmanship of Colgate, and David Foster became president in 1970 and CEO in
1971. Foster was the son of the founder of Colgate-Palmolive's U.K. operations. He joined the company
in 1946 as a management trainee and rose through the sales and marketing ranks both in the United
States and overseas.

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Company overview: Colgate Palmolive (India) ltd.

Colgate-Palmolive is Rs1, 300 crore company started in year 1937.In Rs2, 400 crore domestic
market it enjoys 50% of market share. It spread across 4.5 million retails outlets out of which 1.5 million
are direct outlets.
The Company is having four wholly owned subsidiaries namely Colgate-Palmolive (Nepal),
Multimint Leasing & Finance and Jigs Investments and Passion Trading & Investment Company.
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 companies catering to the personal care products.The company is regularly coming up
with new products and has been a consintent financial performer.
Products - 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, & shaving creams
Household care-Under this segment it has launched brand AXIOM-a dish washing paste. It has also
introduced new products namely Colgate dental floss, ORAGARD-B a mouth ulcer cream etc.
Milestone - In 2003 Colgate was ranked as Indias Most Trusted Brand across all categories by Brand
Equitys Most Trusted Brand Survey for four consecutive years from 2003 to 2007.Colgate was also
rated as the number one brand by the A&M MODE Annual Survey for Indias Top Brands for eight out
of nine years during the period 1992 to 2001.

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BUSINESS PERFORMANCE

Your Companys strong performance continued in 2009-10 despite difficult economic conditions. In a
year marked by volatile financial and growth during the year 2009-10. Sales for the year increased by 16
per cent at Rs. 1,962 crore during the previous year. The toothpaste business registered an impressive
volume growth of 14 per cent during the year.
The profit after tax for the financial year 2009-10 grew by an impressive 46 per cent to Rs. 423 crore as
against Rs. 290 rore in the previous year.
The underlying performance can be gauged from the following ratios:
2009-10

2008-09

Eamings per share (Rs.)

31.1

21.3

currency markets. Your Company achieved a healthy double digit Sales

Dividend per share (Rs.)
Return on Capital Employed (%)

20.0

15.0

156.9

155.0

During the year generation continued to be very strong arising from significant improvements in the
business performance, efficiencies and cost saving across the organization and a continued efficient
collection system. Your Company managed investments prudently by deployment of surplus funds after
ensuring that such investments satisfy the Companys criteria of safety and liquidity.
Your Companys market shares are improving steadily. These it creases are driven by our strong focus
on understanding our consumers, working with our retail customers. Your Company also continued to
focus on driving innovation throughout all areas of business, increasing effectiveness and efficiency
everywhere and strengthening the leadership competency of the team. The sharp focus on these four
clearly defined strategy initiative, helped your Company continue to maintain its leadership position in
the oral care market.Your

Company is positioned well for the future on account of its financial

strength, market leadership position, a proven business strategy that has helped your Company succeed
in strong and weak economic environment team of people working together to achieve the Companys
business goals.

1. Dividend
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The Companys strong cash generation and positive growth momentum led your Board to declare three
interim dividends of Rs. 7 and Rs. 5 per share aggregating Rs.20 per share for the financial year 2009-10
as against Rs.15 per share in the previous year-a 33 per cent increase. These dividends were paid on
September 4 and December 28, 2009 and April 23,2010. Having declared three interim dividends, your
Board has not recommended a final dividend for the financial year 2009-10.
2. Responsibility Statement
Pursuant to Section 217(2AA) of the Companies Act, 1956 the Directors based on the
representations received from the Operating Management confirm:
a) That in the preparation of the annual accounts, the applicable accounting standards have been
followed and that no material departures have been made from the same,
b) That they in selection of the accounting policies consulted the statutory auditors and have applied
them consistently and made judgments and estimates that are reasonable and p....... so as to give
a true and fair view of the state of affairs of the Company at the end of the financial year and of
the profit of the Company for that period,
c) That to the best of their knowledge and information. They have taken proper and sufficient care
for the maintenance of adequate accounting records in accordance with the provisions of the
Companies Act.1956 for safeguarding the assets of the Company and for prevented and detecting
fraud and other irregularities .
d) That they have prepared the annual accounts on a going concern basis.

3. Subsidiary Companies
Your Company was holding 75 per cent shareholding in Processional Oral Care Products Private
Limited at Goa (POC) engaged manufacture of toothpaste. During the year, Company acquired the
remaining 25 per cent shareholding at a total consideration of Rs.2.40 crore and proposed Amalgamation
of POC with your Company. The Scheme of Amalgamation of POC with your Company was sanctioned
by the Bombay High Court at Goa vide its order dated April 16, 2010 with retrospective effect from
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April 1, 2009. Being the Appointed Date under the Scheme of Amalgamation.
Your Company was also holding 75per cent of the shareholding in CC Health Care Products Private
Limited at Hyderabad (CCHL) engaged in the manufacture of toothpowder. During the year your
Company acquired the remaining 25 per cent shareholding at a total consideration of Rs.69.07 laces and
initiated steps before the Andhra Pradesh High Court for amalgamation of CCHL with your Company
effective from April 1, 2009, being the Appointed Date under the Scheme of Amalgamation.
The amalgamation of subsidiaries is primarily designed to simplify the corporate structure and no
material impact either in terms of operations or in terms of capital structure of the Company.
4. Corporate Social Responsibility
Your Company in partnership with the Indian Dental Association (ADI) successfully concluded the 6
edition of a two month long Oral Health Month Program during the year covering a wide spectrum of
activities designed to spread oral health awareness and good oral hygiene practices. The mission of
Program continued to be Zero Tooth Decay involving 17,500 dental professionals pread across 1,000
towns. This year the program extended is support to NCOs like Pratham, Akshara Foundation, Save the
Children, and Salaam Balak Trust among others by conducting free dental check-ups for NGO workers
and children and distributing free samples. In addition, free dental check-ups were conducted for the
Indian Coast Guard in Chennai.
Education has been the primary focus of your Companys Corporate Social Responsibility. Since 1976.
Your company has been conducting a school education program (now called Bright Smiles Bright
Futures Program) wherein your Company partnered
With IDA, to spread oral awareness among school going children in urban and rural schools. Till date,
83 million school children in 1, 73,000 schools in 250 towns in urban and rural areas have benefited
from this program. In addition, your company also conducts in conjunction with IDA a teachers training
program to enable teachers to instill good oral care habits among school-going children on a going basis.
Till date, 2, 43,500teachers have undergone this training.
Since 2002, your company partnered with pratham, a non-profit organization, to promote academic
education of the less privileged children. The grant from the company has supported the concept of
libraries in the s ward of Mumbai where children are encouraged to read books to enhance their
knowledge and continue their academic education.
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Your company started supporting the children affected and in affected by HIV with nutritional needs and
school fees since last two years. The program has infused the children with hope leading to a definitive
improvement in their academic performance.
Your Company will continue to take such measures to make a positive and significant contribution to the
society.
5. Corporate Governance
A separate report on Corporate Governance along with the Auditors certificate on its compliance is
attached as Annexure 1 to this Report.
6. Employee Relations
The employee relations in the Company continued to be positive. During the year, a productivity-linked
long-term settlement was signed with the Aurangabad Factory Union through a process of bilateral
negotiations.
Information as per Section 217(2A) of the Companies Act, 1956 (the Act) read with the Companies
(Particular of Employees) Rules , 1975 forms part of this Report. As per the provisions of Section 219(1)
(b)(iv) of the Act, the Report and Accounts are being sent to the shareholders of the Company excluding
the statement on particulars of employees under Section 217(2A) of the Act. Any shareholder interested
in obtaining the copy of said statement may write to the Secretarial Department at the Registered Office
of the Company.
7. Trade Relations
Wish to record appreciation of the continued unstinted support and co-operation from its Your Directors
retailers, stockiest, suppliers of goods/services, clearing and forwarding agents and all others associated
with it. Your Company will continue to build and maintain strong links with its business partners.
8. Energy, Technology Absorption and Foreign Exchange
The information required under Section 217(1)(e) of the Companies Act, 1956 read with the Companies
9|Page

(Disclosure of Particulars in the Report of the Directors) Rules, 1988 with respect to conservation of
energy, technology absorption and foreign exchange earnings/ outgo is appended hereto as Annexure 2
and forms part of this Report.
9. Directors
Effective February 1, 2010 Mr. Mukul Deoras was appointed as the Managing Director of the Company
to succeed Mr. Roger Calmeyer, who stepped down as the Managing Director of the Company effective
January 31, 2010 to retire from the services of the Corporation. The appointment of Mr. Deoras is
subject to the approval of the shareholders and the Central Government under the provisions of the
Companies Act, 1956.
The Board places on record their appreciation for the distinguished services rendered by Mr. Calmeyer
during his tenure with the Company.
Effective April 1, 2010 Mr. Derrick Samuel has been appointed as Director and Chairman of the Board
to succeed Mr. Justin skala, who has stepped down to head the Latin America Division of the
Corporation. The Board, while welcoming Mr. Samuel, places on record their appreciation for the
distinguished services rendered by Mr. Skala during his tenure with the Company. Under Article 124 of
the Companys Articles of Association, Mr. P.k. Ghosh and Mr. M.A. Elias retire by rotation at the 69 th
Annual General Meeting and, Being eligible, offer themselves for re-appointment.
10. AUDITORS

Messrs. Price Waterhouse, Chartered Accountants, retire and eligible for re-

appointment as Auditors.
11. ACKNOWLEDGEMENT
Your Directors sincerely appreciate the high degree of professionalism, commitment and
dedication displayed by employees at all levels. The Directors also wits to place on record their gratitude
to the Members for their continued support and confidence.

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SUPPLY CHAIN MANAGEMENT OF

(COLGATE PALMOLIVE)
INTRODUCTION OF THE COMPANY
The Company was incorporated on 23rd September 1937, as a private limited company. The
Company Manufacture and market dental care products (dental cream and tooth powder), hair
care products (hair oils, shampoos, brilliantine) and other personal care products such as
shaving creams, and lotions, face creams, baby powder, talcum powder, etc. The products are
marketed under the trademarks "Colgate". "Palmolive, Halo" and "Charmis". - A distribution
set up was also developed on an all-India basis with warehouse facilities in Mumbai, Chennai
and Calcutta. Colgate-Palmolive Company, U.S.A. supplemented this reinvestment by
providing, technical assistance, new product information and its worldwide developments in
quality dental care and other personal care products. The Company has its own research and
development facilities.
Colgate-Palmolive is one of the leading global consumer products companies in the world with
employing 40,000 people in more than 200 countries and territories. They provide quality
consumer products in the areas of Oral Care, Personal Care, Home Care and Pet Nutrition
under widely recognized, famous brands such as Colgate, Palmolive, Ajax, Protex, Irish
Spring, Soft-soap, Simply White and Hills Science Diet. They are the global leader of oral
care, liquid soaps and underarm protection. In other categories, their brands encompass a
range of products that play a familiar role in daily hygiene all over the world. Colgate-Palmolive
entered China in 1992. They were proud to have been a part of the development of China for
nearly two decades. Today, they have commercial offices and manufacturing sites in
Guangzhou, Beijing, Shanghai, Chengdu, Yangzhou and Hong Kong with more than 5,000
employees. Their Huangpu Plant based in Guangzhou and Sanxiao Plant in Yangzhou has
become the largest toothpaste plant and toothbrush plant in Colgate globally. In addition, they
have part of the Global Technology Center, Global Procurement and Greater Asia Colgate
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Innovation Center.

SUPPLY CHAIN MANAGEMENT

The company sells oral care, personal care, home care, and pet nutrition products throughout
the world with the help from the SAP Supply Chain Management application; the company has
significantly enhanced its global supply chain planning processes. Colgate has used this and
other SAP software to improve the quality, timeliness, and accessibility of its data and
automate its supply chain processes. As a result the company is more demand driven and
globally integrated.

WHY SAP WAS SELECTED

1. Strategic partnership with SAP that aligns with Colgates global IT strategy.
2. Ability to leverage existing SAP software and ongoing R & D investment by SAP.
3. Enterprise - wide data for business decision.
4. Extensive planning and execution functions.
5. Support for financial planning and analysis.
6. Support for collaboration with suppliers and customers.

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KEY CHALLENGES
1. Standardized processes for global supply chain management.
2. Align consumer, professional, and retail programs.
3. Increase focus on near term demand signals and respond quickly to unexpected
demand.
4. Tie replenishment and orders to downstream demand rather than high level forecast.

FINANCIAL AND STRATEGIC BENEFITS

1. Streamlined vendor managed inventory.

2. Improved the granularity and timeliness of customer data.
3. Reduced manual orders.
4. Helped planners spend more time analyzing business impacts and less time cleansing
data.
5. Increased products in stock for promotions via effective forecasting and planning.
6. Gained access to a global network of experienced resources.

OPERATIONAL BENEFITS
1. Increased customer order fill rate.
2. Increased forecast accuracy.
3. Reduced inventory.
4.Raised inventory accuracy to more than 99%.
5.Streamlined put away and picking processes.
6. Increased on time, complete, vendor managed inventory (VMI) orders
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7. Cut VMI planning cycle from 5 days to 1 day.

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CREATING A GLOBAL

SUPPLY CHAIN

THROUGH

STANDARDIZED

PROCESSES AND SOLUTIONS

Colgates SAP R/3 implementation began in 1994, providing a platform for responding to global
customer requirements through better understanding of costs and prices, for analyzing
sourcing options, and for determining competitive strategies. With this SAP R/3 execution
framework in place, Colgate embarked on an ambitious plan to streamline its global supply
chain planning processes. Implementation of this plan would not only enable significant
operational improvements in service and inventory reduction, but also position the company to
move from regional sourcing to a globalized model. This supply chain strategy allowing for a
breakthrough in production efficiencies and economies of scale required full visibility of
supply and demand information worldwide and a highly responsive supply chain planning
process. These essential characteristics of Colgates supply chain are being enabled by the
optimization, scheduling, and collaboration capabilities of SAP APO in Supply Chain
Management The capabilities of SAP APO are critical to enabling Colgate to take the next
logical steps in enhancing global supply chain performance, says John Giroux, Colgates
director of global IT strategic planning. SAP APO delivers solutions on three key fronts they
gain visibility to global logistics data, optimize our operations through use of advanced
mathematical planning functions, and provide a platform for collaboration with customers and
partners. By making use of SAP APO, our worldwide operations are truly progressing toward
excellence in supply chain planning. The anticipated savings continue to be facilitated by
supply chain programs and the enterprise-wide SAP software. The broad global
reach of its products, coupled with these continuing margin improvements, enables
reinvestment in growth-building activities and confers on Colgate a sustainable competitive
advantage.

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SUPPLY CHAIN CHALLENGE

In 1993, Colgate recognized that it faced lack of standardization in systems and data
throughout the world and incurred costly duplication of effort on many fronts. The company had
inventory levels that were unnecessarily high, order-related cycle times that were excessively
long, and IT and other costs that were much higher than they would be with global
standardization of systems and data.
In 1994, Colgate began its SAP R/3 implementation, which enabled the company to improve
operations through consistent, global support for financial analysis, logistics planning, and
other business processes. Moreover, a complementary standardization mandate came from
senior management that covered all general naming conventions, formulas and raw materials,
manufacturing data and processes, and financial information. These standardization initiatives
supported by SAP systems contributed to tremendous improvements in efficiency. For
example, in the operations arena, these efforts supported substantial consolidation of
manufacturing facilities. Colgate has now implemented SAP R/3 in 49 countries covering80%
of its business, and by early2002 will be managing 95% of its global operations with SAP R/3.
While SAP R/3-enabled effortsproduced significant results, thecompetitive pressures in
Colgatesglobal markets have driven thecompany to seek furtherImprovements using mySAP
SCM:
On-time and complete customer order fulfillment had beenimproved from very poor levels to
rates of around 90%.However, these rates were hampered from further improvementby
inadequate visibility into capacity constraints and demand,and the continuing lack of product
availability meantpotentially losing out on revenue opportunities. Moreover,these fulfillment
rates were still significantly below theincreasingly stringent requirements of large customers.
The replenishment order cycle time had been reduced from nine days to five days in North
America. However, Colgates order cycle times elsewhere in the world remained much longer,
and competitors were gaining significant ground on this service metric that customers were
finding increasingly important. Moreover, the long order cycle times represented unacceptably
high internal costs to Colgate The capabilities of SAP APO are critical to enabling Colgate to

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take the next logical steps in enhancing global supply chain performance, says John Giroux,
Colgates director of global IT strategic planning.
Reductions in inventory had been achieved, including an increase in turns per month for
finished goods inventory in North America. However, internal inventory costs remained
unacceptably high, and the high inventory levels were indicative
of the limited visibility that continued throughout Colgates supply chain operations.
Despite various reductions in capital and expenses that had been achieved, price competition
continued to drive a focus on cost reduction. Plant operations, packaging, and transportation
costs were all targets for further reductions.
Finally, the very source of Colgates competitive advantage created supply chain challenges.
Rapid global introduction of new products, the needs for customization, and services to global
customers created continued complexities for the companys supply chain.

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IMPLEMENTATION
While brands in Colgate have been managed globally, the company realized it must also
manage demand and supply on a worldwide basis. The Colgate Global Supply Chain initiative
began in November 1999 with the objective of building on the companys investment in its core
SAP R/3-enabled business processes in order to further improve supply chain performance.
These performance improvements would be achieved by focusing on the fundamentals
globally standardizing internal supply chain and business-to-business processes, implementing
shared services, sourcing strategically, and implementing cost reduction programs. Colgate
identified three major supply chain strategies to achieve the companys goals:
Roll out a vendor-managed inventory (VMI) program with key accounts to drive significant
channel inventory and cycle time improvements.
Implement Cross-Border Sourcing (CBS), a global planning initiative to enable Colgate to
move from a regional to a global sourcing model, thereby driving forecast improvements and
safety stock reductions, enabling consolidation of assets, and taking advantage of economies
of scale on a worldwide basis.
Implement collaborative planning, thus enabling development of a closed-loop process to
manage promotional demand and synchronize activities throughout the supply chain.
1. Vendor-Managed Inventory:
VMI is a pull process by which Colgate replenishes customer distribution centres (DCs) based
on daily transmitted inventory and demand information. The current focus on VMI is in North
America, where 40% of shipped cases from five plants are managed using VMI. The
implementation includes 40 customer DCs at 12 customers, covering all categories of Colgate
products (about 1,000 SKUs). As supply and demand are more precisely matched, this VMI
implementation enables lower finished goods inventories, higher rates of on-time and complete
orders, and reduced replenishment cycle times.
The VMI business process is supported by supply network planning (SNP) in SAP APO. Daily
inventory levels and demand from customer DCs are transmitted to SNP, which calculates
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replenishment orders. SNP incorporates plant capacity information to determine production

requirements and any supply constraints. The replenishment orders are transmitted back to
the customers via electronic data interchange (EDI) for acknowledgement and for handling the
customers information processing requirements.
The benefits of VMI will be multiplied as implementation extends toward all transacted
business in North America and to other geographic regions.
2. Collaborative Planning:
The demand planning (DP) capabilities and collaborative engine in SAP APO provide the
Colgate sales subsidiary with a mechanism for communicating demand information to the
supplier and further synchronizing planning across the supply chain network. For example,
collaborative planning, forecasting, and replenishment (CPFR) is being deployed by Colgate
by making use of SAP APO tools with customers, enabling collaboration on promotional
activity, inventory levels, and demand forecasts. The associated CPFR processes can drive
forecast accuracy improvements and there by enable a range of cycle time and customer
service improvements.
In particular, statistically computed-base demand is calculated by DP and can drive repeatable
replenishment processes, and changes resulting from promotions can be incorporated using
collaborative processes. The support that the collaborative process provides for separate
management of base and promotional demand is very valuable. Promotional demand
management is substantially independent of the base demand, and it is critical information for
driving manufacturing, product finishing, and distribution in Colgates consumer products
business. To support the collaborative process covering promotional demand, the collaboration
engine allows the exchange of up-to-date planning information, enables user-access security
restrictions, supports exception-based management, and facilitates tracking of performance
measures including forecast accuracy.

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OUTCOME
The SAP APO-supported supply chain implementations have achieved significant, measurable
benefits for the initial America based implementations. The competitive position of Colgates
business has been enhanced by improving service to the retail trade and internal customers,
enhancing responsiveness, and improving margins. Colgate has achieved performance gains
with SAP APO beyond what had already been achieved with SAP R/3,and the company is
well-positioned for multiplying the benefits across the global enterprise.
The benefits achieved across the three initiatives include:
1. Vendor-Managed Inventory: The SNP-enabled VMI process has enabled improvements to
98% in on-time and complete orders and an improvement to a one-day replenishment order
cycle. In the eyes of Colgates customers and partners, these improvements are very
significant. The previous SAP R/3-enabled achievements of 70% on-time and complete orders
for VMI and the five-day replenishment order cycle would not have been acceptable in the
unfolding competitive environment.
2. Cross-Border Sourcing: The initial single-country implementation of Cross-Border Sourcing
enabled the replenishment order cycle time (which includes time for order preparation,
processing, and shipping) to be reduced from 62 days to 33 days. Supply and demand were
more accurately matched, so there was a significant increase in shipments per month, a
reduction in inventory by about 22%, and an increase in case-fill rates from 94% to 97%. CBS
yielded a significant improvement in on-time and complete orders for intercompany
replenishment, and customer order fulfilment increased to 95%.

3. Collaborative Planning: Responsiveness to promotions another changes in supply and

demand have been enhanced due to the closer link between producers and consumers.
Improvements in cycle times, fulfilment performance, and inventory levels were supported
through enhancements enabled by DP and the collaborative engine. In particular, forecast
error with a major retailer was reduced from 61.9% before CPFR to 21.9% after CPFR was
implemented.
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All three initiatives were supported by SAP APOs real-time integration model, where any
changes in stock, sales orders, and so on are transferred in real time between customer or
internal ERP systems and SAP APO. This ensures that modifications to the plan can be made
rapidly which is particularly important to facilitate planning for promotions.
The VMI, CBS, and collaborative planning implementations will be extended globally. As these
implementations are extended to all brands and plants, Colgate expects to multiply the impact
of the current implementations substantially. Moreover, savings are being achieved outside
direct supply chain operations, including in key areas such as IT.

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NEXT STEPS

Colgate intends to continue to pursue supply chain improvements that will enhance its
competitive position. In addition to extending the use of vendor-managed inventory, crossborder sourcing, and collaborative planning globally, Colgate is pursuing:
1. Repetitive manufacturing: Colgate is working with SAP to implement repetitive
manufacturing processes using the PP/DS capabilities in SAP APO. These processes
will perform repeated production runs using a single bill of material, with back flushing of
material requirements. Production will become more responsive to promotion-driven
demand changes, as making and finishing operations will be distinguished as separable
manufacturing processes, facilitating quick production scheduling changes. Colgate is
specifically supporting development of a PP/DS-related Wave algorithm. This algorithm
will provide optimization of repetitive manufacturing during potential sudden peaks and
valleys in requirements and finite capacity constraints.
2. Outsourced manufacturing: Due to the variations in supply requirements resulting
from the promotions-driven environment, third-party manufacturing contractors are
increasingly relevant to Colgates business. Colgate expects to make use of SAP APO
enabled collaborative planning links with these contractors.
3. Transportation

planning:

Colgate

is

planning

to

implement

Transportation

Planning/Vehicle Scheduling (TP/VS) in SAP APO to optimize its transportation network

and derive ongoing cost savings.
4. Supply chain event management: Colgate is planning to use SAP supply chain event
management capabilities to track carrier tendering and customer shipments and to
provide early warning of undue delays or problems.
5. Additional collaborative scenarios: Colgate will pursue various additional forms of
collaboration with customers and partners. Of significance will be Colgates participation
in consumer goods industry e-marketplaces, which provide exchanges for collaborative
demand, procurement, and logistics planning.
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23 | P a g e

Supplier Code of Conduct

Colgate people worldwide take enormous pride in our reputation for integrity and the
business success that our reputation has enabled. This reputation has taken years to
build and maintaining it is vital to our success. This Colgate Supplier Code of Conduct
has been developed to convey to all current and future vendors, suppliers, contractors,
consultants, agents and other providers of goods and services (our suppliers)
Colgates expectation for all of our suppliers to adhere to the highest ethical standards
when conducting business.
Colgate suppliers are required to take reasonable steps to ensure that this ColgatePalmolive Company Supplier Code of Conduct is communicated throughout their
organizations and to make this Code available to their employees and throughout their
own supply chain.
Colgate values its business relationships with suppliers and requires its suppliers to
share our commitment to, at a minimum, compliance with the following standards:
1. Antitrust/Competition Law:
It is Colgates policy that all suppliers comply fully with competition laws (known as
antitrust laws in the U.S.) applicable to them. Competition laws ensure that companies
compete to get business by offering lower prices, innovative products and better service
and not by interfering with the market forces of supply and demand. Colgate requires
that all suppliers conduct their business in full compliance with all applicable laws
intended to promote free and fair competition.
2. Confidential/Proprietary Information:

Suppliers must respect Colgates intellectual property, trade secrets and other
confidential, proprietary or sensitive information and may not use or disclose any such
information except in accordance with their contract with Colgate and for the benefit of
Colgate. Any information or data regarding Colgate operations shall be treated by
suppliers as confidential at all times unless that information enters the public domain

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through no fault of the supplier.

The suppliers obligations with respect to

Colgatesconfidential or proprietary information include:

Not to disclose this information to other people within the suppliers organization
except on a strict need to know or need to use basis.
Not to disclose this information to persons outside of the suppliers organization.
Not to use this information for the suppliers own benefit or the benefit of any other
person.
3. Ethical Dealings:
Honest dealing with customers and suppliers is essential to sound business
relationships. Colgate seeks to give all potential suppliers fair consideration. Decisions
are based on objective criteria such as price, quality, and service capability as well as a
vendors reliability and integrity. Giving or receiving any kickbacks, bribes or similar
payments of any sort is prohibited. Our suppliers are required to demonstrate these
same high ethical standards and to conduct all business transactions with integrity and
fairness.

Conclusion

The analysis of annual report of the last three of the company reveals the company is improving working
efficiency taking step of increasing its turnover.
The analysis reveals that the total income of the company is increasing and its expenses are decrease.
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Hence it can be concluded that the company is performing very efficiently, it has highly qualified
managerial personnel. The analysis also reveals that the company utilizes its raised sources very
efficiently to earn profit and achieve its objectives.
Company repays there loan regularly which is good sign for the future.
Ratios show satisfactory situation so it indicate the companys ability to increase its profit, performance
and financial position is very sound.
Overall it can be concluded that company is performing very efficiently and therefore it has future
prospects in India and international market.
COLGATE PALMOLIVE LTD. analysis, I can say, it is financially sound and well
managed. The company is trying to improve its efficiency more and more. We hope that the
company reaches at the top by making strong efforts. It was tough job to make this repot but last able
to complete the project.
I myself could put into use my theoretical knowledge. They helping to build my
confidence. I am thankful to all who helped me in the project report.

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BIBLIOGRAPHY

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REPORTS
-Annual Report 2007-2008 of GOLGATE-PALMOLIVE LTD.
Annual Report 2008-2009 of GOLGATE-PALMOLIVE LTD.
Annual Report 2009-2010 of GOLGATE-PALMOLIVE
LTD.

BOOKS:
-B.S.Shah Principles of financial Management 4th edition Ahmedabad,
-B.S.Shah Prakashan. 2008-09.

WEBSITES:
www.Colgate-palmolive.ltd.com

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