Proctor & Gamble Streamlining Products

After many years of expansion into different areas such as beauty products and pet food, Proctor and Gamble has announced it was cutting up to 100 brands to focus on others such as Tide, that helped the company become a powerhouse the last few decades

This move is just part of the company’s strategy of improving the financial performance of 80 products by doubling down on those that generate nearly 95% of the company products and over 90% of its sales, said its CEO A.G. Lafley.

The company as well as the industry in general, has been under pressure as consumers spend less than before the big financial crisis.

Lafley did not indicate which of the 100 brands were to be sold off or discontinued, but he did say taken together their aggregate sales declines amounted to 3% per year during the past three years.

One analyst in the industry speculated that P&G would likely keep its mainstay products such as Gillette, Tide and Pampers. However, he speculated that brands that were lesser known such as Graham Webb the beauty brand or Zooth an oral care brand for children would likely be cut.

The analysts said it was likely P&G could divest brands that did not fit in with the traditional family and baby products such as Duracell the battery maker or Braun its small appliance line.

One trouble spot has been beauty. Excluding some currency adjustments as well as onetime items, P&G reported sales in that unit were down 3% for the quarter.

Consumers continue to spend less nearly five years following the start of the financial crisis. P&G like many other manufacturers have come under great pressure to improve on sales while cutting costs.

In 2013, the company came under pressure from an activist investor who pushed the board to oust Robert McDonald as CEO.

Lafley was President and CEO at P&G between 2000 and 2009. He appears to be determined to streamline core operations. P&G in April sold Eukanuba and Iams its pet food to Mars, the candy maker for over $2.9 billion.

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