Business / The Clorox Co. Company Analysis

The Clorox Co. Company Analysis

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Autor:  anton  19 December 2010
Tags:  Clorox,  Company,  Analysis
Words: 729   |   Pages: 3
Views: 632

On May 3rd, 1913, five California entrepreneurs set out to invest in the first American commercial-scale bleach factory. Edward Hughes, Charles Husband, William Hussey, Rufus Myers, and Archibald Taft each invested $100 on the start of the bleach factory, which was to be located in Oakland, California on the east side of the San-Francisco Bay. Later that year the company acquired its first plant site in Oakland, paying $3,000 (The Clorox Co. Website) for it. In 1914, the name Clorox was suggested by an engineer for an equipment supplier, Abel M. Hamblet. The name was derived from “chlorine” and “sodium hydroxide,” the two active ingredients in the bleach. Hamblet also drew a rough sketch of a diamond with Clorox written in the center and the words liquid, bleach, cleanser, and germicide surrounding it. This design was later registered by the founders as the company trademark. Clorox became known as not only a single product, but also as the company’s main brand and the overall company name, The Clorox Company. By the end of 1914, the company had sold 750 shares of stock at $100 a piece giving them $75,000 in start-up capital (The Clorox Co. Website.) This start-up capital gave The Clorox Company the money needed to start producing their product, which was originally 21% sodium hypochlorite and sold in 5 gallon jugs. These large jugs were mainly transported on horse-drawn wagons to businesses in Oakland such as laundries, breweries, walnut processing sheds, and municipal water companies. The Clorox Company later began producing a less concentrated household version of the cleaner that only contained 5.25% sodium hypochlorite bottled in 15 ounce amber pints. This new household version of Clorox was seen in nearly every home across North America and parts of Canada by 1928. This great increase in demand for Clorox forced The Clorox Company to build a dozen new plants across America between 1938 and 1956. The Clorox Company was doing so well by 1957 that the annual sales were up to over $40 million (The Clorox Co. Website.) The amazing year that The Clorox Company was having brought dollar signs to many investors. Procter and Gamble Co. was very interested in purchasing The Clorox Company and ended up doing so towards the end of 1957. This purchase brought great interest from the FCC who saw P&G Co. attempting to create a monopoly by purchasing The Clorox Company. In 1969 the P&G Co. lost ownership to The Clorox Company after litigation with the U.S. Supreme Court which ended up lasting 10 years. This enabled The Clorox Company to return to a fully public company on January 2, 1969. The company opened a technical center in 1973, which continuously produced new products. Today The Clorox Company manufactures some of the best-known products and brands on the market, most of which are either the market leader or a close second.

The Clorox Company is a company that does all it can to make sure that the consumer is happy with their product(s). Their mission statement “build brands that make consumers’ lives easier” holds true to that. In total, including all products sold, the company spent $2.5 billion dollars, but its net sales were $4.4 billion dollars giving them a total gross profit of $1.9 billion in 2005 (2005 Clorox Financial Statement.) In each of the previous three years, the company had a net cost and sales of about $200 million less each year. The company has spent roughly $80 million a year (2003-2005 Clorox Financial Statement) in the last 3 years just on researching and developing each of their products to ensure that they are the best possible for the consumer. This has been a direct reason for their outstanding and increasing gross profits each year. In 2005 the company made roughly $1.9 billion, $1.83 billion in 2004, and $1.8 billion in 2003 (2003-2004 Clorox Financial Statement.) This allows the company to spend nearly half a billion dollars each year on advertising to get their products to the very few consumers that have yet to be introduced or wooed by The Clorox Company’s vast number of products. The brand Clorox is headed by the home care and laundry additives divisions.

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