Dabur India Limited: Growing Big and Global case study

  FOR SOLUTION CONTACT

DR. PRASANTH BE MBA PH.D. MOBILE / WHATSAPP: +91 9924764558 OR +91 9447965521 EMAIL: prasanththampi1975@gmail.com WEBSITE: www.casestudyandprojectreports.com

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.

The Indian Institute of Business Management & Studies

Subject: Managerial Economics Marks: 100

Page | 2

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.

2. Do you think the growth of Dabur from a small pharmacy to a large multinational company is

an indicator of the advantages of joint stock company against proprietorship form? Elaborate.