P&G to cut up to 100 brands in major restructuring

Want China Times, Staff Reporter 2014-08-09

P&G's company logo. (File photo/CFP)

Procter & Gamble has decided to sell or terminate up to 100 of its subsidiary brands in order to reduce costs, and focus on brands that generate the most sales.

The multinational consumer goods company is still to decide which brands it will keep and which ones it will ditch, but more than half of its current brands will be shed, mostly minor brands that have annual sales of less than US$100 million each.

P&G CEO Alan Lafley said fewer of its household, female and baby care brands will be cut, compared with its four other major areas.

The company has not revealed its business plan for developing the remaining brands, but it is certain that the brands that will be kept are leading brands in their own fields, and which remain popular with shoppers.

Liang Yu, an executive with P&G's Greater China, said P&G currently owns more than 20 brands in China and the Chinese market is still seen to have growth potential.

A senior employee said however that the P&G he knows would be reluctant to cull its brands, as the move would hurt the company's stability in the finance and commerce markets. He further noted that the reduction would also mean at least half of the company's workforce would be let go.

P&G will reportedly focus on the 70 to 80 brands that contribute up to 90% of the company's total sales.

Some 23 of P&G's leading brands, including Pampers, each generate sales of between US$1 billion and $10 billion a year.