UNIVERSIDAD

esan
Course: Product Design and Development Professor: Estuardo Lu

FINAL GROUP WORK

TENTATIVE INDEX

* EXECUTIVE SUMMARY (Only in 2 pages is synthesis of the problem, the findings,

conclusions and recommendations. It summarizes the main approaches and proposals
recommended for the product. It isn't an introduction, not the antecedents, neither a
preface.) May use the example of a brief or format for a launching recommendation.

1. ANALYSIS AND STRATEGIC DIAGNOSTIC (Where am I?)

1.1. Analysis of the Mission, Vision and Values and/or Business Principles.
Mission:
We will provide branded products and services of superior quality and value that
improve the lives of the worlds 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.
Vision
Be, and be recognize as, the best consumer products and services company in the
world.
Values
o Integrity:
-We always try to do the right thing.
-We are honest and straightforward with each other.
-We operate within the letter and spirit of the law.
-We uphold the values and principles of P&G in every action and decision.
-We are data-based and intellectually honest in advocating proposals, including
recognizing risks.
o Leadership:
-We are all leaders in our area of responsibility, with a deep commitment to delivering
leadership results.
-We have a clear vision of where we are going.
-We focus our resources to achieve leadership objectives and strategies.
-We develop the capability to deliver our strategies and eliminate organizational barriers.
o Ownership:
-We accept personal accountability to meet our business needs, improve our systems
and help others improve their effectiveness.
-We all act like owners, treating the Companys assets as our own and behaving with the
Companys long-term success in mind.
o Passion for Winning:
-We are determined to be the best at doing what matters most.
-We have a healthy dissatisfaction with the status quo.
-We have a compelling desire to improve and to win in the marketplace.
o Trust:
-We respect our P&G colleagues, customers and consumers, and treat them as we want
to be treated.
-We have confidence in each others capabilities and intentions.
-We believe that people work best when there is a foundation of trust.
Business Principles:
o We Show Respect for All Individuals:
We believe that all individuals can and want to contribute to their fullest potential. We
value differences. We inspire and enable people to achieve high expectations,
standards and challenging goals. We are honest with people about their performance.
o The Interests of the Company and the Individual Are Inseparable:
We believe that doing what is right for the business with integrity will lead to mutual
success for both the Company and the individual. Our quest for mutual success ties
us together. We encourage stock ownership and ownership behavior.
o We Are Strategically Focused in Our Work:
We operate against clearly articulated and aligned objectives and strategies. We only do
work and only ask for work that adds value to the business. We simplify, standardize
and streamline our current work whenever possible.
o Innovation is the Cornerstone of Our Success:
We place great value on big, new consumer innovations.
We challenge convention and reinvent the way we do business to better win in the
marketplace.
o We Value Mastery:
We believe it is the responsibility of all individuals to continually develop themselves and
others.
We encourage and expect outstanding technical mastery and executional excellence.
o We Seek to Be the Best:
We strive to be the best in all areas of strategic importance to the Company.
 We benchmark our performance rigorously versus the very best internally and externally.
We learn from both our successes and our failures.
o We Are Externally Focused:
We develop superior understanding of consumers and their needs.
We create and deliver products, packaging and concepts that build winning brand
equities.
We develop close, mutually productive relationships with our customers and our
suppliers.
We are good corporate citizens.
We incorporate sustainability into our products, packaging and operations.
o Mutual Interdependency is a Way of Life:
We work together with confidence and trust across business units, functions, categories
and geographies.
We take pride in results from reapplying others ideas.
We build superior relationships with all the parties who contribute to fulfilling our
Corporate Purpose, including our customers and suppliers, universities and
governments.

1.2. Buyers and Consumers Market Analysis

1.2.1. Level or % Penetration of the Category

In 2015, hair care in Peru recorded growth of 1% in volume terms. In current value terms,
growth was 4%, which was lower than the 8% rise in 2014 due to lower economic growth in
the country. The category continued to grow dynamically in 2015, with the deceleration of the
economy having little impact on this. Shampoo is already a category considered to contain
products of a basic necessity and, as such, will continue growing. In addition, Peruvians are
very aware of the importance of clean and good-looking hair. The percentage of penetration
is 79%.
 1.2.2. Market Size - Historical Evolution
Hair care is the largest category within beauty and personal care, representing a 19% value
share in 2015. Hair care is expected to grow at a CAGR of 1% at constant 2015 prices over
the forecast period. It will continue outperforming growth expected for the economy since
consumers consider hair care as a basic need. Any contraction in the economy will not have a
strong effect on hair care; however, it would stimulate purchases of small pack sizes.
 1.2.3. Existing Segmentation
The behavior of the NSE, the levels A / B and C, which have further broadened the base of
households buying the categories. In the analyzed about the percentage of distribution of the
purchase of shampoo by socioeconomic levels, we can observe that it does not find any
significant difference because the shampoo is known as a product of the basic basket, since
it is an important element for personal hygiene So all socioeconomic segments use it.

1.2.4. Growth Rate of the Total Market and by Segment

Sales of Hair Care by Category: Value 2010-2015

PEN million 2010 2011 2012 2013 2014 2015

2-in-1 Products 104.1 115.3 134.1 150.3 159.6 158.6

Colourants 150.6 164.9 181.9 201.1 211.3 222.6
Conditioners 135.4 148.7 170.5 179.8 204.2 211.1
Hair Loss Treatments 1.0 1.0 1.0 1.1 1.1 1.2
Perms and Relaxants - - - - - -
Salon Hair Care 26.7 27.7 31.1 33.9 36.7 39.5
Shampoos 335.9 362.8 403.0 432.1 459.8 472.7
- Medicated Shampoos - - 12.2 13.8 14.9 16.2
- Standard Shampoos 335.9 362.8 390.8 418.3 444.9 456.5
Styling Agents 121.5 126.5 133.7 140.0 152.4 168.1
Hair Care 875.1 946.9 1,055.3 1,138.2 1,225.0 1,273.8
Source: Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade
interviews, trade sources

1.2.6. Purchasing Habits:

1.2.6.1. Frequency and quantity of purchase
The frequent use of shampoo is very a common habit in our population. It is estimated
that the 79% of the population in Peru use a shampoo, with a frequency of uses:
- All days: 96%
- 4 to 6 times a week: 2.68%
- 2 to 3 times a week: 1.32%

1.2.6.2. Reasons for product purchase

The reasons presented bellow responds to the purchase reasons:
o Shampoo is already a category considered to contain products of a basic
necessity.
o Peruvians are very aware of the importance of clean and good-looking hair.
o Greater specialization is a constant trend within hair care, because there is
a wide variety of products available within the category, each addressing a
specific hair condition. This variety has led consumers to further specialize
their consumption. Towards the end of the review period, each consumer
tended to have his/her own shampoo according to personal needs,
replacing the family shampoo that was used before. For example, the most
popular added-value features are anti dandruff, hair loss and hair damage,
which are the main concerns among the population when it comes to their
hair. There are also specialized products for straight or curly hair.
o Medicated shampoos are mainly concentrated on treating dandruff and
itching, which account for the majority of hair care problems among
 Peruvian consumers. Hair loss treatments are directed mainly at young
adults worried about losing their hair.

1.2.6.3. Decision makers and influencers of the purchase

Influencers: Specialists, Health organizations (OMS, INEN, etc.), companies and
family. Decision makers: Parents, oneself

1.2.6.4. Moments of Use

The shampoo is using for hair care; all people use that when take a shower but also
this depend of the type of shampoo. More premium brands will continue entering the
category, especially those offering added benefits previously not covered in the
country. There is still room for growth of hair care, as there are upper/middle- and
high-income consumers in the country that are able to buy specialized alternatives.
Premium brands are mainly distributed through beauty salons.
1.2.7. Purchasing Attitudes:
1.2.7.1. Brand Awareness
Company Ranking:
 1.2.7.2. Perception of Brand Image

% retail value rsp 2011 2012 2013 2014 2015

Procter & Gamble Per SRL 31.8 30.4 27.7 27.7 28.4
L'Oral Per SA 16.0 15.4 15.2 15.6 17.2
Unilever Andina Per SA 8.1 10.0 13.0 12.7 12.8
Henkel Peruana SA 10.5 10.1 10.1 10.2 10.8
Cetco SA 10.4 10.3 10.3 10.2 8.4
Natura Cosmticos Sociedade Annima 4.2 4.3 4.4 5.5 4.8
Productos Avon SA 5.1 5.0 4.8 4.2 3.7
Mayorsa SA 3.1 2.7 3.2 3.0 3.5
Plus Cosmtica SA - - - - 0.3
Colomer Andina SA 0.1 0.2 0.3 0.3 0.3
Genomma Lab Per SA - 0.2 0.3 0.3 0.3
Oriflame Per SA 0.3 0.3 0.3 0.2 0.3
Qumica Suiza SA 0.3 0.3 0.3 0.2 0.3
Distribuidora Las Poncianas SA 0.2 0.2 0.2 0.2 0.2
Unique SA 0.2 0.2 0.2 0.2 0.2
Percosm Peru SAC 0.2 0.1 0.1 0.1 0.2
California 2000 SAC 0.1 0.1 0.1 0.1 0.1
Colgate-Palmolive Per SA 0.1 0.0 0.0 0.0 0.0
Alicorp SAA 1.0 0.2 - - -
Hipermercados Metro SA - - - - -
Others 8.4 10.1 9.5 9.2 8.1
Total 100.0 100.0 100.0 100.0 100.0
Source: Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade
sources
1.2.7.3. Brand Preferences

1.2.7.4. Reasons of use and non-use of the Brands

All the peruvians people who buy a shampoo, they choose the shampoo by the type of hair
that they have and they choose the brands of use by the ingredients that the product has.

NOT INGREDIENTS FOR THE SHAMPOO

 1.2.7.5. Valuation of Attributes

Source: Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews,
trade sources

1.2.8. Distribution or Commercialization Channels

1.2.8.1. Main points of purchase
Supermarkets
Department stores
Drugstores
Traditional grocery
Hair Salon

1.2.8.2. Typical Commercial Structure of the Market

MARKETING AND PUBLICITY
Marketing and Advertising for manufacture of shampoo
Development of Logos
Stationery Development
Advertising your business on our website: Banners

INVESTMENT AND FINANCING

Cost Structure for manufacture of shampoo
 Financing and loans manufacture of shampoo (Bank Accounts, current
working capital loan, loan fixed assets, leasing, factoring, discounts,
mortgage, letter of credit, letter of guarantee account)
Cash Flow for making shampoo
Search partners and investors

INTERNET AND E-COMMERCE

Development of a website
Electronic Commerce: Mechanisms of Payment: Visa, Mastercard,
Paypal, 2checkout, bank transfer, check

MANAGEMENT SOFTWARE AND PROGRAMS

Management software for manufacturing shampoo
Management Information Systems
Accounting Software, customer management

SUPPLIERS
Suppliers for manufacture of shampoo: inputs, machinery, equipment,
products, merchandise
Information on courses, classes and institutes for manufacture of
shampoo
Local, land and office for manufacture of shampoo
EXPORT
Steps and procedures for export
Export Simplified: Exportafcil, Serpost, FEDEX, DHL, TNT, UPS
Easy Export
Customs Brokers, freight forwarders, transport, insurance,
DUA Customs Declaration, Certificate of Origin, Health Record,
Record Plant Health, Animal Health Check, Visa Textile,
+ Incoterms: FOB, CIF
+ Purchase agreement international
BUSINESS PARTNERSHIP
Excess manufacturing shampoo
Business Association
Joint venture
Contract Management
Joint Venture
Consortium
BIG CLIENTS
Supplier of large companies
Shopping state
 1.2.8.3. Resale Prices and Commercialization Margins

EXTERNAL ANALYSIS

1.3. Global Environment Analysis The Competitive Advantages of Nations

1.4. National Environment Analysis - Macro Environment - SEPTE.
1.5. Competitive Environment of the Sector Analysis - Micro Environment 5 Forces
1.5.1. Power of Suppliers
1.5.2. Power of Customers Buyers
1.5.3. Entry of New Potential Competitors
1.5.3.1. Entry and Exit Barriers
1.5.4. Competition of Substitutes
1.5.5. Current Direct Competitors Analysis
1.5.5.1. Strengths, Weaknesses
1.5.5.2. Current and Future Strategies
1.5.5.3. Rivalry Level and Competitive Position
1.5.5.4. Competitors Positioning
1.5.5.5. Coverage or Distribution
 1.5.5.6. Penetration in Households or Customers
1.5.5.7. Packaging and Presentation Size
1.5.5.8. Product Types
1.5.5.9. Average Prices by Point of Sale
1.5.5.10. Positioning Comparative Analysis
1.5.5.11. Products and Presentation Comparative Analysis

INTERNAL ANALYSIS

1.6. Analysis and Implications of the Results Obtained in previous years

1.6.1. Turnover

1.6.2. Volumes

There is not an exact report of volumes(units) that the company sales, but we have
reports in percentages about it.

Procter & Gamble, the world's largest maker of household products, reported sales
declines due to the strength of the dollar continued to weigh on its external
markets. P & G said it expected sales next year will fall by about 5% due to
strong dollar. P & G has sold around 50 brands since 2014 in a bid to restructure
its portfolio and focus on product lines fastest growing. The latest round of
divestitures comprised 43 brands. Revenue fell 9.2%. P & G, which gets almost
 two-thirds of its revenue from international markets, has been raising prices to
offset the impact of the dollar, but this led customers to favor cheaper local
alternatives. Net income attributable to P & G fell 80% to US $ 521 million, or 18
cents per share, in the fourth quarter, the company said.

1.6.3. Market Share

1.6.4. Coverage or Distribution

 1.6.5. Brand Awareness and Brand Recall

1.6.6. Current Positioning

The Pantene brand is positioned in the minds of consumers as achieving a perfect

hair, "a Pantene hair ". Pantene is considered an expert brand in hair care. The type
of positioning strategy that Pantene has had is that of "by user classes", which
consists of highlighting the kind of person who uses the product.
Pantene Latin America and Peru are betting on Hollywood IT Girl Selena Gomez to
be the face - and hair - of the best of Pantene.
 1.6.7. Penetration in Households or Customers

Brand Penetration Manufacturer Origin

H&S 25.80% P&G Mexico

Pantene 18.00% P&G Mexico

Sedal 14.50% Unilever Brasil

Pert Plus 10.60% P&G Mexico

Ebel 8.30% Cetco Per

The table above shows that the company Procter & Gamble has a penetration of 54.4% in
the Lima market only in its three main brands.

When we talk about loyalty of the brand, we could find the percentage of consumers that
prefer only one brand of shampoo available in the peruvian market, which are the following:

Total A/B C D/E

%Consumers of only one 90.0% 88.9% 90.7% 90.0%

brand

Head & Shoulders 23.1% 18.9% 21.9% 25.2%

Pantene 14.5% 18.2% 14.6% 13.3%

Sedal 11.3% 12.1% 10.8% 11.3%

Pert Plus 9.1% 4.4% 10.8% 9.8%

Ebel 7.5% 2.9% 10.2% 7.4%

Others 24.5% 32.4% 22.4% 23.0%

1.6.8. Average Prices by Point of Sale

1.6.9. Product Portfolio Analysis

1.6.9.1. BCG Matrix

 Relative Market Share

High Low

M High Stars Question Marks

a Gillete Olay
r Pantene
k Head & Shoulders
e Pamper
t Whisper
G
r
o Cash cows Dogs
w Ariel Ambi pur
t Vicks
h Tide
Low Oral- B

1.7. Resources Analysis

1.7.1. Cash

1.7.2. Receivables

1.7.3. Inventories
1.7.4. Plant and Equipment and Infraestructure

1.7.5. Brands and Patents

 1.7.6. Own Processes

P & G's long-term vision has the following objectives:

a) Operate all their plants with 100% renewable energy
b) Use 100% renewable or recycled materials in their products and packaging
c) Not to send waste derived from production or consumption to rubbish dumps
P&G has led changes in the industry that help conservation of resources, some examples
are: a) compaction, b) the use of recycled materials in packaging and c) innovation in the
supply chain resulting in lower fuel consumption. As well as developing high impact programs
in the social field that improve the lives of those who need it the most and they also support
communities in which they live, work and serve to be prosperous.

Optimizing the distribution

One of the goals that P&G set in 2010 to achieve its long-term vision for the conservation of
resources was to reduce the kilometers of truck transport in 20% per production unit. In Latin
America, they have optimize the distribution of their routes and increased their multi-modal
transport in order to progress in this area. By consolidating products of smaller categories in
common shipments and combining inventories of 2 or more countries, their Regional
Distribution Center in Coln, Panama, has managed to save about 5 million kilometers and
its respective reduction in CO2 emissions. Also, their plant Materials, In Peru, has been able
to significantly reduce the kilometers of Paths through the centralization of their Production
and aligning their shipment schedules for better use of trucks.

Supply chain initiatives of P&G:

1. Collaborative Planning Forecasting and Replenishment (CPFR):

- CPFR Pre scenario - Bullwhip Effect: The concept emerged when the logistics
executives at Procter & Gamble (P&G) examined the order patterns for one of their
best-selling products Pampers. Its sales at retail stores were fluctuating, but the
variability was certainly not excessive. However, as they examined the distributors
orders, the executives were surprised by the degree of variability. When they looked
at P&Gs orders of materials to their suppliers, such as 3M, they discovered that the
swings were even greater.At first glance, the variability did not make sense. While the
consumers, in this case, the babies, consumed diapers at a steady rate, the demand
order variability in the supply chain were amplified as they moved up the supply chain.
P&G called this phenomenon the "bullwhip" effect:Separate demand forecast done by
players in supply chain.Price fluctuations manufacturers and distributors periodically
have special promotions like price discounts, quantity discounts, coupons, rebates,
and so on.Players in supply chain after receiving order accumulates demands (Order
Batching) before issuing an order. Rationing and shortage gaming.

- CPFR Model: CPFR is a nine-step process model consisting of:

Developing collaboration agreement
Creating joint business plan
Creating sales forecast
Identifying exceptions for sales forecast
Resolving collaborating on exception items
 Creating order forecast
Identifying exceptions for order forecast
Resolving / collaborating on exception items
Generating orders

- Benefits
Improved responsiveness to consumer demand , the reduction of out-of-
stocks and shorter cycle times leads to a more responsive and reliable supply
chain for P&G, thereby improving on-shelf availability and increasing
consumer satisfaction. Through CPFR P&G reduced replenishment time by
20%.
Greater forecast accuracy with single shared forecast Sharing a single
forecast along the supply chain enables P&G to benefit from potential
synergies and brings together trading partners efforts. Depending on their
position in the supply chain and supply chain activities, trading partners may
have different views of the market and information. Combining this knowledge
is the foundation for greater forecast accuracy. Through CPFR forecast
accuracy improved by 20%.
Increase in sales Collaboration on planning and forecasting potentially
reduces out-of-stocks, lost sales and increases on-shelf availability which
leads to increase in sale of P&G.
Cost reduction P&G has aligned the production schedule with the agreed
forecast, so costs has been reduced by decreasing set-up times, effort
duplications and variations.
Improved relationship between the trading partners, the relationship between
P&G, wall mart has improved when collaboration takes place. Trading partners
will gain a better understanding of their respective businesses by regularly
exchanging information and establishing direct communication channels.
Inventory reduction Increased forecast accuracy facilitates a decrease in the
safety stock, reducing inventory levels and increasing on-shelf availability.
Thus the inventory cost for P&G has reduced.
2. Consumer Driven Supply Network (CDSN)

- Pre Scenario:P&G believes in 2 moments of truth.

First, when customer buys the product from shelf.
Second, when they actually use it and like it.
In order to handle the first moment of truth, it is important to have stocks available on
shelf.P&G realized that 48% of times their products were unavailable on the shelf when the
customers wanted it. They were losing a large quantum of sales and hence needed to take
corrective action.
- Initiative: P&G redefined its supply chain strategy under the leadership of Keith
Harrison Head of Global Product Supply Division.P&G decided to have a connection
between actual sales and the supply chain process. Paradigm shift in viewing supply
chain management from forecast driven to actual demand driven. Supply Network
instead of a supply chain because of information flow in all directions. P&G started its
 supply chain from store shelves and moved back to its suppliers.This operating
strategy was called Consumer Driven Supply Network.CDSN required P&G to create
a responsive supply chain that would produce and supply products as per demand at
the customer level.q Harrison was quoted saying: We need to work off of real
demand, so that we produce what is actually selling, not what is forecast to sell.
- How did P&G implement CDSN: P&G collaborated with its partners across the supply
network to win consumers at the point of purchase. Implemented an online system-
Web Order Management.This enabled retailers to connect to P&G and access its
scheduling, inventory and replenishment levels.Various other initiatives like using
multifunctional resources, joint scorecards and sophisticated technology were
undertaken in collaboration with retailers.
- CDSN Intelligent DailyForecasting (IDF): IDF tracks daily demand across different
stores, and that itself becomes the replenishment plan of P&G for those stores. Actual
demand is picked up from the scanner data at the point of sale and it is made
available at the plant where it becomes part of the daily production schedule. As a
result of implementing IDF, P&G is running few plant at 6-8 hours response time.
- Impact of CDSN Results:
1. Forecasting Accuracy: Improved forecast accuracy by 30%.
2. Shelf-Level Out of Stocks: The percentage of products that are out of stock on retailers
shelves at any given time. P&G has cut this to 5%, from 10% within 8 months of
implementation.
3. Total Supply Chain Response Time: The time from when a cash register records the sale
of a product to the purchase of raw materials to produce its replacement. From six months, it
came down to two months.
4. Total Supply Chain Inventory: The hard count of all products flowing through the supply
chain at any given moment, whether on store shelves, in back of the store, at warehouses, in
trucks or wherever. P&G got a daily count, rather than weekly or monthly and hence reduced
safety inventory by 10%.
5. Pricing-Design From the Shelf Back: CDSN helped in determining an acceptable price
point for an item and then working it back through manufacturing and distribution to see if that
product can be delivered at a price acceptable to consumers and a profit acceptable to P&G.
6. Topline and bottomline: Increased overall sales by 15% in one year. Net profits witnessed
a 19% gain from $4.35 billion to $5.19 billion.
3. Control tower program
- Control Tower Program:Logistics optimized by making changes to the rate, route,
mode and method of transportation.Helped in eliminating inefficiencies such as
loading and unloading delays, rush transport up-charges, dead legs (empty trucks)
and production line stops.The lead logistics provider centrally controls and optimizes
the product flows, delivering maximum truck fill for every kilometre travelled in the
fastest possible time, in an ecologically friendly manner.
- P&G Control Tower Program: Kicked off in 2010 in Central and Eastern Europe,
Middle East and Africa (CEEMEA). Turkey and Egypt were the first countries in
CEEMEA region to adopt the Control Tower logistics optimization effort.Results
Amount of empty truck journeys reduced by over 15% to date. 58% reliability
improvement on inbound operations in Egypt. 68% improvement in our finished
product inbound operation in Turkey. 67,000 metric tons reduction in CO2 emissions.
 1.7.7. Brand Image and Purchase Intention

Product Frequency of use % Place where they buy Brands (Most

it % important brands) %

Shampoo Consumers: 99.0

- Daily/ Intermediate - Supermarket 38.7 - Head & Shoulders

92.4 - Grocery store 34.7 36.8
- Weekly 2.9 - Market 15.7 - Sedal 16.6
- Eventually 4.7 - Catalog 6.7 - Pantene 11.8
- Other places 4.2 - Ego 6.0

1.7.8. Others Intangible Assets

The

1.8. Capabilities and Skills Analysis

1.8.1. In Inbound Logistics
Inbound logistics were before managed by their suppliers. Therefore, it had to rethink its
operational strategies while sourcing thousands of chemicals, polymers, packaging, etc. for its
diverse products.
Thus, P&G's operational overhaul includes consolidation of back-office functions like human
resources, finance, facilities management and IT into a single unit. Elimination of nonvalue
added costs by outsourcing non-core operations and processes, setting up of Global
Purchases division for sourcing P&G supplies

1.8.2. In Research and Development

Though P&G is widely known as a marketing company, the success stems from their world-
class innovation.The fortunes of P&G as a corporation grow from significant investments in
R&D and a world-class technical organization that creates superior consumer products. They
are consistently recognized as world leaders in innovation among consumer products
companies, and they are leading in every product category in which they compete. P&G has
state-of-the-art facilities and more depth and breadth in science and technology resources
than any consumer products company in the world.

1.8.3. In Production or Operations

Procter & Gambles presence in Latin America dates back more than 60 years to the opening
of the Mexican subsidiary in 1948. Today P&G is one of the largest consumer goods
companies in the region. They employ people across 14 countries, including 19 manufacturing
sites, 12 distribution centers and a service center. The leadership market positions are in
detergents, diapers, feminine hygiene, health and personal care, batteries, and blades &
razors products. Peru is not among the largest markets, those are are Mexico, Brazil,
Venezuela and Argentina

1.8.4. In Marketing
In marketing spending, they have delivered strong savings over the last two years in non-
working agency fees and commercial production costs. They have been reinvesting these
savings in marketing programs that improve the reach, frequency or continuity of our
advertising, and in programs such as product sampling that generate trial of the superior
products.

1.8.5. In Sales
On the annual report for 2016 up until now these are the following results for sales:

We have to wait until the end of the year to conclude if sales declined in the year 2016 or not.
In the following world map the distribution of sales can be seen. This shows that Latin America
is not a big market comparing it with the rest of the world. They are still developing their
products here, but this will take time since these countries might not yet be ready for the
innovative products.
1.8.6. In Outbound Logistics or Distribution
The evolution in the lines of distribution and logistics allow them to generate more value for
their consumers and commercial customers. They believe in the products, and highlight the
strategy that P&G efficiently reaches retail and wholesale customers, backed by innovative
marketing programs. As the industry began to shift from plant-based sourcing to global
corporate-based sourcing, consumer goods companies, which traditionally leveraged on in-
person negotiations with supplier found the process slow and nontransparent. Further, P&G's
logistics was highly fragmented because procurement decisions for outbound logistics were
made in local and regional customer service units spread globally.

1.8.8. In Negotiations and Customer Relations

In every country they are it is easy to get in contact with P&G. Through their website they
explain easily how to get in contact. Besides questions about the products some consumers
are looking for answers how to solve daily problems with P&Gs products. How for example
you can best remove stains or which is the best dental care product.

1.8.9. In Finance
Inside their company they have multiple employees for different financial aspects:
Financial Analyst
Cost Analyst
Customer Business Development Analyst/Market Strategy Analyst
Customer Accounting Manager
Assistant Service Manager
Internal Controls Auditor
Corporate Accountant
Tax Analyst
This all in order to go from managing the profitability of one of the brands to being a key
financial leader at one of the manufacturing operations or in our cutting-edge shared services
organization. Looking at the facts of 1.8.5 other financial details are showed.

1.8.10. In Human Resources

P&G has over 95.000 employees. Because of good human resource management and
keeping the workforce happy. Integrity, trust and respect for others are fundamental values
that drive the day to day working methods and decision making of Procter & Gamble's
global workforce. The importance of curiosity and innovation and the ability to discover makes
a person good to work for P&G.

1.8.11. In Information Technology

Information Technology at Procter & Gamble is where business, innovation and technology
come together to create competitive advantage. Their mission is to deliver IT to help to win
with consumers. The IT professionals are diverse business leaders who apply IT mastery to
deliver game-changing, technology-driven business models and capabilities. Their are four
categories of IT inside P&G:
Application & Integration
Data & Analytics
Infrastructure
IT Security & Risk
P&G IT is a key business enabler that encompasses technology tools, strategic development,
collaboration and decision-making. Their role goes beyond traditional "hardware and software"
aspects of Information Technology and provides distinctive value by connecting business
needs and information technology possibilities.

1.8.12. In Supplying
P&G has a network of over 75.000 suppliers. They work together with local companies in
order to be environmentally more friendly. Every year P&G gives awards for the most
excellent suppliers and put their names on the website to known by others and give them that
extra support and recognition. All to keep them as a supplier because they need a globally
widespread supplier network to reach all of their customers.

STRATEGIC DIAGNOSTIC

1.9. SWOT Analysis and Definition of the Business Key Factors

1.9.1 SWOT and its implications
Swot Analysis
Implications:
With the internal strengths P&G can take advantage of their external opportunities. In Peru dry
shampoo is an emerging market. Only specialized hair stores sell them and for a high price.
Since Pantene from P&G has a strong brand image and a loyal customer base they can take
this internal strength when launching the dry shampoo. The weaknesses however are harder
to overcome when launching this new product. To get the sales for this new product people
need to know what extra benefit dry shampoo can give to their daily life. However, a big
segment can be targeted so the weakness for customer concentration is not visible for this
product. Because none of the competitors have yet launched the product shampoo here in
Peru, Pantene can profit from the first mover advantage. Normally a first mover has costs
because of the newness of the product, but P&G already sells many dry shampoos in other
countries combined with its great distribution network this will be not a problem. Only after
some time it is possible that other cheaper brands will copy their product, but by that time
Pantene is hopefully in the customers minds.
1.9.2 EFE and EFI Matrix

1.9.1. I-E Matrix of Market Attractiveness versus Competitive Position

1.9.2. Conclusions of the Market Attractiveness Analysis
The position of P&G in the market is ideal for developing the product and entering the market
in Peru. In other countries dry shampoo is doing increasingly well. This means that investing
in this market in Peru is not of high risk. However, internally they could work a bit more on
their weaknesses. This in order to get a stronger business. Most likely this will change after
the launching of the dry shampoo since promotion activities will decrease after a while when
customers are known with the product. If there are any other weaknesses coming up after a
while it should be considered not further invest in dry shampoo in Peru.

1.10. Present Situation Diagnostic

1.10.1. Main Opportunities and Threats
The main opportunity of this product from P&G is that it is an eco friendly product. Mostly
women need a lot of time washing their hair. This costs water and the chemical shampoos. By
using dry shampoo they will only need to wash their hair one time a week. Another opportunity
is that in Peru there is not a market yet for dry shampoo and if they will launch it now they will
have the benefit of first mover and undertake the competitors (one of their main threats) Of
course a normal shampoo might cost a bit less, but this substitute should be replaced by dry
shampoo and not vice versa. With their product experience of Pantene and their already
strong brand image it will be likely that many potential customers are going to buy the dry
shampoo and staying loyal to the brand.

---------------------------------------- First part due 14-11---------------------------------------------

ANEXS

Statements of financial situation of Procter & Gamble Per S.R.L- December

31, 2014 and 2013 In thousands of S /.
Can include:
o Any other information that complements your analysis:
Brief for a market research request
Market research consulting services comparision and selection
Market research report with:
Secondary Information findings
Research design and measurement instruments.
Reports of the results of your primary research.
 Information of packaging and packing process.

Presentacin final
The plans have to be presented oral and written in class. Each team have a maximum
of 40 minutes to expose their proposal with 5 minutes for questions.
Plans must be concise, clear with high level of analysis and synthesis.
High impact presentation would receive extra grades.

Qualification criteria:
Criteria Grades

Group 80%

Clear definition of the opportunities and

of the problems in the Diagnostic 5

Clear definition of the objectives 3

Efficient strategies and tactics 6

recommended

Coherence and creativity of the ideas 2

Oral and written presentation 2

Evaluation of the class 2

Individual 20%

Oral Presentacin Oral 8

Participation in Presentation 6

Answers to questions 6