EXTERNAL FACTOR EVALUATION

(EFE) MATRIX
Factors Weight Rate Wt. Score
OPPORTUNITIES

Internet domains 0.12 4 0.48

Innovation (Research & Development) 0.07 3 0.21
Product related diversification (Pringles , pet
foods) 0.07 3 0.21
Explore new markets 0.07 3 0.21
Growth of middle class market (China , India) 0.058 3 0.174
Advertisement of unpopular products 0.075 2 0.15

Health and beauty products for men 0.058 2 0.116

Acquisitions of smaller players 0.075 3 0.225

THREATS

Strong competitors 0.116 4 0.465

Own Brands of retailers (Equate from Wall Mart) 0.1 4 0.4

Substitute products 0.05 2 0.1
High cost of production 0.05 3 0.15
Regulations regarding chemical ingredients in cosmetic
products. 0.05 2 0.1
Rising price of inputs/raw materials 0.0375 1 0.0375

Total 1.0 3.12

 PEST ANALYSIS
APEST analysislooks at how external factors can affect a
business's activities and performance.
 PEST ANALYSIS

POLITICAL FACTORS
Following are some of the political factors:

Tax policy
Rebate
Quota
Industrial policy of Government
Subsidies from Government
Labour policy
Political situation
Law and order

There are very little chances of political variables to effect the Procter
& Gamble production and selling behavior.
 PEST ANALYSIS

ECONOMIC FACTORS
Following are some of the political factors:

Minimum wage laws

International policies
Pricing of raw materials
Interest rates
Inflation

Economic factors are those which effect the production of any industry.
If the economic conditions of the country is not that strong and Procter
& Gamble increases its price in this situation. Then it would impact in
negative sales as the purchasing power of the people will force people
to shift from high price soap to low price soap.
 PEST ANALYSIS

SOCIAL FACTORS
Following are some of the social factors:

Age distribution
Population growth rate
Employment levels
Income statistics
Education and career trends
Religious beliefs
Cultural

The living standard which is forcing the people to use

standardized product and people are more conscious
regarding the quality.
 PEST ANALYSIS

TECHNOLOGICAL FACTORS
Following are some of the technological factors:

Automation
Improved quality of parts and end product
Incentives
Significant cost savings
Use of outsourcing to control costs and offer greater flexibility.

Business innovation leaves highly good impacts in any business.

As Procter & Gamble use more advance technology in its
production process. It will result in increment of their production.
 PORTERS FIVE FORCES
Bargaining Power
of Supplier Weak Medium Bargaining
-Switching cost Power of Buyer
-Availability of - The individual
substitute (standard buyer
supplies) - Large retailers
-Importance of
Buyer to supplier Rivalry among
existing
competitors
- Composition of
competitors
Threats of New - Scope of competition
Entrants - Degree of differentiation Threats of
-Advertising and Substitute
Marketing product
High
- Customer Loyalty /
Brand Name - Perceived price /
- Retaliation value
- Sales Network - Switching cost
-Credibility Weak Medium
 SWOT ANALYSIS
Strengths Weaknesses

Opportunities SO Strategies WO Strategies

-Internet domains
-Innovation (R & D)
-Product related diversification
-Explore new markets
-Growth of middle class market
-Advertisement of unpopular
products
-Health and beauty products for
men
-Acquisitions of smaller players

Threats ST Strategies WT Strategies

-Strong competitors
-Own Brands of retailers
-Substitute products
-High cost of production
-Regulations ingredients
-Rising price of inputs/raw materials