Strategic Management: Strategic Choices and Implementation - Thesis Example

What Investors Need To Know About Colgate Company Reports to investors (both potential and current) forms an integral part of the company long-term financing. If well drafted and presented to the right investors, it can be the genesis of turn around of events in a business environment. Following my research, I have documented what every investor needs to know about Colgate Palmolive Company. The risks and the opportunities which they could reasonably expect to face (SWOT), Company’s Mission, Vision, earning potentials and stakeholders. Introduction Colgate Palmolive Company is a multinational company which deals with oral hygiene products, soaps and detergents. It was founded as a family business back in 1806 by William Colgate. In 1928 it merged with the Palmolive Peet hence called Colgate Palmolive Company. It was first listed on the NewYork stock exchange in March 1930. Among its competitors, it has the largest resource base across the globe and it commands presence in every corner of the world. Investors Information Company’s Mission, Vision and Stakeholders Colgate Palmolive Company’s mission is statement is object oriented. It revolves around cost reductions and ability to provide sustainable and reliable oral health care to the world. Owing to the cost reduction, it means that in the long run the cost of production will be low and thus more earnings for the company. The issue of creating goodwill among the consumers on Colgate’s products will increase their loyalty which means that even in times of economic recession, the earning potential for the company won’t be much affected. Thus as an investor your interests will be well taken care of and you can expect high returns on your investment (ROI). The company’s vision is all about innovation. In the modern world, without innovative products and ways of production, the companies are quickly finding themselves sinking into oblivion. With Colgate Company, their innovativeness has always been consistent and is evidenced by the creative products they avail to the market. Examples are the Colgate herbal and Colgate teeth whitener. As an investor, this is one of the few companies in the world you can comfortably invest your money without fear of the organization’s oblivion and/or products redundancy in the market. The consistency of the Colgate’s values, mission and vision with the stakeholder’s expectations is another absolute advantage that any investor can count on. The cost reductions and the innovativeness means the company will be in a position to retain the current clientele base and attract more customers. Thus in the long run the stakeholders will be contented and this means the company’s future is expected to be brighter. Threats and Opportunities The business external environment is critical to the current and future firm’s success. The pressure exerted on a business by the external factors which are beyond the business control can sometimes be overwhelming to the organization. As an investor you should note that Colgate Company has been able to deal with external threats satisfactorily and at the same time exploited to the maximum the opportunities available. This fact is evidenced clearly by the company’s ability to be profitably operational in the market for over a century. Looking at the past, Colgate was quick to spot opportunities availed by the external environment of a gap in the oral hygiene products and moved in rapidly to fill the gap. Also in line with its vision to be an innovative hub, investors should expect more opportunities in future to be well utilized. About threats posed to Colgate, following my research, I can confidently say that this company has amazed me by the way it has neutralized such in the past and still remained afloat. The threat of stiff competition has been tackled through the introduction of more eco-friendly products. The aggressive campaign to use herbal oral care was a major threat to Colgate as its products were synthetic chemical based. The company was able to develop its own brand of herbal products and successfully marketed it under its prominent brand of Colgate herbal. It also managed to convince its consumers on the safety of the synthetic chemical based oral products through introduction of products such as Colgate triple action and Colgate teeth whitener. This case scenarios demonstrate that no threat in future that can be too big to overwhelm this company. As an investor you know very well that many companies in the world rarely survive competition threat, but for Colgate you are lest assured that the Company is here to stay. Company’s Internal Analysis, Strengths and Weaknesses Colgate being an international organization that deals with oral health products such as toothpastes, tooth brushes, mouthwash among others, it has been very successful across the globe owing to its concerted strengths. It has strong brand equity. Any oral product branded Colgate is highly acclaimed. This is due to the fact that Colgate has been able to manufacture high quality products which have increased consumer’s trust tremendously. This strength has enabled Colgate to comfortably shove away any competition due to the loyalty exhibited worldwide on its products. The company also boasts of its strong financial position in the global market which enables it to compete quite easily. For a company to induce opposition to Colgate, it has got to have sufficient resources to be able to pool a shaking stunt against the firm. This huge financial base makes it to benefit from economies of scale. This poses a huge challenge to the relatively smaller firms in the same industry as the level of the economies of scale that it enjoys keeps it away from numerous bills that it would otherwise have to foot. This translates to relatively lower production costs. In this regard, the profits that the company enjoys also get to be relatively higher. This means that an investor in Colgate will enjoy much more dividend per share. Colgate has a competitive advantage in that it has a very elaborate supply chain. Unlike many other companies, Colgate has worked on its supply chain over the years and it has been able to make it quite outstanding. This has enabled the company to have a very strong global market share. With a huge market share, it is able to stand any form of competition that is thrown on its way by any firm, be it regional or international. This is one of the strength that has made it possible for Colgate Company to stand the test of time. Another key strength that Colgate Company has is the pricing advantage. The company is able to set its own prices by itself without much influence from the rest of the industry and the prices shall be able to stick and to work out just fine. This enables the firm to be in a position to influence the trends in the industry. With this kind of power at its disposal, Colgate is able to influence the industry at free will and in turn fight away competition quite effectively. In the event that any external firm offers competition that is striking on the well-being of Colgate Company, it is able to use its cost advantages and economies of scale to lower the prices of its products quite significantly and in turn throw the competition out of the market. The major internal weakness that Colgate Company has been grappling with from time to time in its quest to remain at the helm of the industry is e-commerce. It has not fully embraced e-commerce despite the fact that the world is increasingly going digital and online presence is now the in thing. Colgate needs to move with speed and get to be in the forefront in e-commerce in the market or else it shall sink deep into oblivion without realizing it. With the level of market share that Colgate Company already enjoys, it would be much simple for the firm to make it big in the e-commerce business. Conclusion Every investor’s big dream is to invest his/her money in a venture that will give maximum returns in the near future while at the same time guaranteeing long term security. Based on my comprehensive analysis and research, one such venture that an investor can trust with his money is Colgate Company. There is no time in future that humanity will stop using oral hygiene products. As for the key aspects discussed in this report, it has proven that indeed that Colgate presents one of the most interesting, dynamic, safe and promising business environment to invest in. References Colgate & Company. (1897). Colgate & Co. perfumers: New York, U.S.A. : 1897. New York: Colgate & Co. Colgate-Palmolive Company SWOT Analysis. (2003). Datamonitor Plc. McNamara, C. (2011). Basic description of strategic planning: Including key terms to know. Retrieved August, 2011, from http://managementhelp.org/strategicplanning/basics.htm McNamara, C. (2011). Basics of developing mission, vision and values statements, free management library. Retrieved August, 2011, from http://managementhelp.org/strategicplanning/mission-vision-values.htm#anchor519441 David, F. (2013).The Business Vision and Mission.  Strategic Management. Pearson Education Retrieved from http://faculty.unlv.edu/amiller/BUS496/david%20_sm14_inppt02.ppt Read More