We are finally seeing some headway on the acquisition of Duracell by Proctor & Gamble (see my Sept. 20th post). The sale of the Duracell brand (along with the rest of the Gillette-owned family of products) has led to a lot of confusion for us and meant that our battery shelves have been essentially empty for the last couple of weeks.
Shipments have begun arriving again, and we are hopeful of catching up on a huge stack of backorders by week’s end. We appreciate the patience of lots of loyal customers and hope that we can get back to our “same day shipping” policy on most of our orders. Backorders are problems for everybody.
Duracell was named to the 84th position in Business Week’s list of Best Global Brands last year. They had 2005 sales of $3.57 billion dollars and it looks like the are continuing to gain market share from competitors like Energizer.
The acquisition of Gillette and all its brands was a $57 billion dollar deal and its hard to say how ProCell may fare in an acqusition like this.
Some see it as a great step.
“This merger is going to create the greatest consumer products company in the world,” said billionaire investor Warren Buffett, whose Berkshire Hathaway is Gillette’s largest shareholder with 96 million shares, or about 9 percent of the company.
We’re not so sure. A specialty brand like ProCell may not fit in well with a company that is focused on consumer brands. ProCell, as you may know, is not packaged for retail sales and is intended for distribution to end users in the industrial, medical and electronics industries. After spending a lot of effort in promoting the brand to these industries, Duracell, under Gillette’s ownership, dropped most of these efforts, reduced their sales staff, and scaled back promotion of the brand.
Initially, it looks like P&G may scale back even further. They appear to have replaced all the folks at Gillette who handled the nuts and bolts process of getting ProCell batteries to distributors and they have had great difficulty in keeping product in the pipeline. Industry reports indicate that as many as 6000 jobs may have been cut in the implementation of this acquisition. Who know how many of these cuts will impact ProCell?
I am hopeful that things will get back on track and Proctor & Gamble will realize what great customer loyalty ProCell has. Its a brand worth a lot more attention than they have given it so far.
Got an opinion about this mega-merger? Let us know.