Procter amp; Gamble, the world’s largest FMCG company whose global sales top £50bn a year and whose brands include Pampers, Gillette, Ariel and Fairy, has announced that up to 100 of its least profitable brands will be axed as it looks to streamline its costs and focus on its core brands.
A spokesperson for the company said its 70 to 80 leading brands accounted for 90% of its sales and 90% of its profit in the year to 30 June.
On a call with analysts last Friday (August 1), CEO AG Lafley said the strategy would create “a new streamlined” P amp;G “that will continue to grow faster and more sustainably, reliably create more value”. He said the company will shed about 90 to 100 brands around the globe over the next year or two, leaving it with about 70 to 80 brands. It did not name which products it intends to keep but they will be organised into up to a dozen business units under “four focused industry areas”.
It is unlikely that any of the company’s big brands will disappear from the shelves, with most of the mega-sellers such as Head amp; Shoulders and the aforementioned names retained; according to industry experts, the axe is likely to fall on fading names such as Silvikrin or regional brands such as Trojan detergent.
P amp;G’s big rival Unilever has already been wielding the axe on its own portfolio, selling off Slim-Fast, Ragu and Bertolli.