packaged goods

P&G To Shed More Than Half Of Its Brands

Procter & Gamble plans to sell more than half of its brands in order to streamline the company and boost sales growth, CEO A.G. Lafley announced during the company's earnings presentation for its fiscal fourth quarter and full year ended June 30.

Lafley said that P&G will focus on 70 to 80 consumer brands, including Tide and Pampers, which together account for some 90% of the company's sales and 95% of profits, and either divest or find ways to exit between 90 to 100 smaller brands, reported The Wall Street Journal.

"We are going to create a faster growing, more profitable company that's far simpler to operate," he said.

P&G's net sales declined 1% in the fourth quarter, although organic  sales rose 2%.

For the full fiscal year, net sales edged up 1% to $83 billion, and organic sales rose 3%. Net income rose 3% to $11.6 billion.Lafley said that although P&G delivered on its financial commitments for the fiscal year, it "should have and could have done better."



5 comments about "P&G To Shed More Than Half Of Its Brands".
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  1. Mike Einstein from the Brothers Einstein, August 1, 2014 at 12:40 p.m.

    Ask the Soup Nazi why brands can't bust through theses days and he'll say: No scale for you!

  2. Michael E. Keenan from Keenan & Company, August 1, 2014 at 5:20 p.m.

    Review carefully. A separate, non-bureaucratic fresh brand management hand combined with non-dinosaur, fresh creative agency(s) might find gold and winners amongst the brands to be deep-sixed.

  3. Bill Sinnott from D L Ryan Companies, August 2, 2014 at 9:56 a.m.

    Move should give Procter a lot more clout with the retailers. All should be traffic building " must have" brands which don't need a lot of distribution money to support. It also frees up a lot of shelf space for the retailer's own brands.
    Big question is who will end up with the discarded brands ? Assume it will mostly be strategic acquirers since these smaller brands usually can stand by themselves. I would guess the Sun Products, Pinnacle Brands and even Walmart's of the world are talking to their investment bankers this week-end.

  4. Mark Burrell from Tongal, August 2, 2014 at 10:26 a.m.

    The Soup Nazi actually has a product; not scaling though

  5. David Cearley from self employed, August 2, 2014 at 11:26 a.m.

    I'm sure Warren's people have their checkbook out. This is a killer opportunity for nimble players.

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