Dabur India Limited: Growing Big and Global
Dabur is among the top five FMCG companies in India and is
positioned successfully on the specialist herbal platform. Dabur has proven its
expertise in the fields of health care, personal care, homecare and foods.
The company was founded by Dr. S. K. Burman in 1884 as small
pharmacy in Calcutta (now Kolkata), India. And is now led by his great grandson
Vivek C. Burman, who is the Chairman of Dabur India Limited and the senior most
representative of the Burman family in the company. The company headquarters
are in Ghaziabad, India, near the Indian capital New Delhi, where it is
registered. The company has over 12 manufacturing units in India and abroad.
The international facilities are located in Nepal, Dubai, Bangladesh, Egypt and
Nigeria.
S.K. Burman, the founder of Dabur, was trained as a physician. His
mission was to provide effective and affordable cure for ordinary people in
far-flung villages. Soon, he started preparing natural remedies based on Ayurved
for diseases such as Cholera, Plague and Malaria. Due to his cheap and
effective remedies, he became to be known as ‘Daktar’ (Indianised version of
‘doctor’). And that is how his venture Dabur got its name—derived from Daktar
Burman.
The company faces stiff competition from many multi national and
domestic companies. In the Branded and Packaged Food and Beverages segment
major companies that are active include Hindustan Lever, Nestle, Cadbury and
Dabur. In case of Ayurvedic medicines and products, the major competitors are
Baidyanath, Vicco, Jhandu, Himani and other pharmaceutical companies.
Vision, Mission and Objectives
Vision statement
of Dabur says that the company is “dedicated
to the health and well being of every household”. The objective is to “significantly accelerate profitable growth
by providing comfort to others”. For achieving this objective Dabur aims
to:
·
Focus on growing core brands
across categories, reaching out to new geographies, within and outside India,
and improve operational efficiencies by leveraging technology.
·
Be the preferred company to
meet the health and personal grooming needs of target consumers with safe,
efficacious, natural solutions by synthesising deep knowledge of ayurveda and
herbs with modern science.
·
Be a professionally managed
employer of choice, attracting, developing and retaining quality personnel.
·
Be responsible citizens with a
commitment to environmental protection.
·
Provide superior returns,
relative to our peer group, to our shareholders.
Chairman of the company
Vivek C. Burman
joined Dabur in 1954 after completing his graduation in Business Administration
from the USA. In 1986 he was appointed Managing Director of Dabur and in 1998
he took over as Chairman of the Company.
Under Vivek Burman’s leadership, Dabur has grown and evolved as a
multi-crore business house with a diverse product portfolio and a marketing
network that traverses the whole of India and more than 50 countries across the
world. As a strong and positive leader, Vivek C. Burman has motivated employees
of Dabur to “do better than their best”—a credo that gives Dabur its status as
India’s most trusted nature-based products company.
Leading brands
More than 300
diverse products in the FMCG, Healthcare and Ayurveda segments are in the product
line of Dabur. List of products of the company include very successful brands
like Vatika, Anmol, Hajmola, Dabur Amla Chyawanprash, Dabur Honey and Lal Dant
Manjan with turnover of Rs.100 crores each.
Strategic positioning of Dabur Honey as food product, lead to market
leadership with over 40% market share in branded honey market; Dabur
Chyawanprash is the largest selling Ayurvedic medicine with over 65% market
share. Dabur is a leader in herbal digestives with 90% market share. Hajmola
tablets are in command with 75% market share of digestive tablets category.
Dabur Lal Tail tops baby massage oil market with 35% of total share.
CHD (Consumer Health Division), dealing with classical Ayurvedic
medicines has more than 250 products sold through prescription as well as over
the counter. Proprietary Ayurvedic medicines developed by Dabur include Nature
Care Isabgol, Madhuvaani and Trifgol.
However, some of the subsidiary units of Dabur have proved to be low
margin business; like Dabur Finance Limited. The international units are also
operating on low profit margin. The company also produces several “me – too”
products. At the same time the company is very popular in the rural segment.
Questions
1.
What is the objective of Dabur?
Is it profit maximisation or growth maximisation? Discuss.
Objectives are:
·
Focus on growing core brands
across categories, reaching out to new geographies, within and outside India,
and improve operational efficiencies by leveraging technology.
·
Be the preferred company to
meet the health and personal grooming needs of target consumers with safe,
efficacious, natural solutions by synthesising deep knowledge of ayurveda and
herbs with modern science.
·
Be a professionally managed
employer of choice, attracting, developing and retaining quality personnel.
·
Be responsible citizens with a
commitment to environmental protection.
·
Provide superior returns,
relative to our peer group, to our shareholders.
It is a Growth Maximisation.
Profit maximization is traditional objective of a
firm. Sales maximization objective is explained by Prof. Boumal. On similar
lines, Prof. Marris has developed another alternative growth maximization model
in recent years. It is a common factor to observe that each firm aims at
maximizing its growth rate as this goal would answer many of the objectives of
a firm.
Marris points out that a firm has to maximize its balanced growth rate over a period of time.
Marris assumes that the ownership and control of the firm is in the hands of two groups of people, i.e. owner and managers. He further points out that both of them have two distinctive goals. Managers have a utility function in which the amount of salary, status, position, power, prestige and security of job etc are the most import variable where as in case of are more concerned about the size of output, volume of profits, market shares and sales maximization.
Utility function of the manager and that the owner are expressed in the following manner-
Uo= f [size of output, market share, volume of profit, capital, public esteem etc.]
Um= f [salaries, power, status, prestige, job security etc.]
In view of Marris the realization of these two functions would depend on the size of the firm.
No comments:
Post a Comment