P&G awaits "triggering point" for sophisticated products

Jose Medran, the general manager of Procter & Gamble Romania, the most important player on the personal care products market, believes once they reach the “triggering point”, all categories in their product range will witness a rise in the volume of sales.
“There is a so-called etriggering pointe in the development of a market – as the gross domestic product per capita and other economic welfare indicators advance, categories register growth.
There is a sequence of categories, which will rise one after another, from the basic products to the more specialised products,” says Medran.
As for the current trend of various sectors of the personal and home care products market, Medran believes the market is at the stage where basic products are developing, but has reached the bottom-line, for example; in terms of the range of facial care products.
The products in P&Ges portfolio last year recorded growth rates of 7% to 15% domestically, with an unexpected development being registered in the sector of female intimate care products.
The companyes representatives expect the Gillette unit, which P&G merged with at the middle of last year domestically, to see solid growth.
One of the most dynamic employers on the market, having hired around 100 people last year, P&G anticipates it will hire fewer people this year, a figure estimated around 50. Of the newly hired people, 25-30 will work with P&G Romania, while another 20 persons will be employed at the procurement and logistics centre that was opened in Bucharest last year and is owned by P&G Balkans.
P&G was one of the first multinationals to invest in Romania, entering the market in 1994 when it acquired the detergent plant in Timisoara.
The company currently produces more than 100,000 tonnes of detergent and 30,000 tonnes of bleach a year.
P&G representatives say around 50% of the annual production of the plant in Timisoara is exported to countries such as Moldova, Ukraine, Bulgaria, Macedonia and Bosnia.
In 2005, the domestic branch of P&G generated a turnover worth 215.5 million euros, according to the data provided by the Finance Ministry. The category of paper products, including Always and Discreet sanitary napkins and Pampers diapers, accounts for 40% in the companyes turnover, while cleaning products contribute another 40% and beauty products weigh 20% in turnover.
Procter & Gamble was also the biggest investor in advertising within the cosmetics industry last year.
A rising number of players are expected to focus their attention on the domestic market, as it currently offers growth rates that are significantly higher than on the markets in the rest of Europe.