1. DABUR INDIA LTD. - GLOBALIZATION
Case Presentation

2. MGT 372.4 (STN) International Business GROUP MEMBERS
Mustakimul Huq Nabil
Quazi Farhan Hossain
Tarannum Bashar
A.N.M. Saiful Imam
Epsita Bhowmik

3. Dabur-Background Vision
Established in 1884 by Dr. S.K.Burman as a trading company, currently it is the fourth largest FMCG company in India with sales turnover of INR22.6 billion as of 2007(exhibit 3). Dabur operates in four business units: consumer care, consumer healthcare, foods business and international business. As of 2007, it was among the top ten FMCGs in India.
Vision
"Dedicated to the health and well being of every household"

4. Should DABUR build scale first in India before investing in global operations?
Dabur could globalize considering the factor such as:
Market driven- strong independent distribution channels
Cost driven- it will enable them to gain E.O.Scale, thereby lowering unit cost
Competitiveness- it can align with its value to innovate rapidly
Prevailing challenges in building scale nationally
Dabur’s share of revenues
across regions
THEREFORE, DABUR SHOULD
NOT BUILD SCALE IN INDIA
FIRST!

5. Should DABUR build scale first in India before investing in global operations?
It has only 3.8% market share though being among the top ten (exhibit 1).

6. Should DABUR build scale first in India before investing in global operations?
The reasons are:
Targeting a focus market
Selling niche products
Thus they should try and gain a greater market share. Challenge the inflexibility of the leader, through
Increased scale
Inflexibility in customization
Growing Indian economy
THEREFORE, DABUR COULD BUILD SCALE IN INDIA
FIRST!

7. Does global expansion detract the company from its core market?
NO, it does not detract from its core market!
Dabur is targeting to cater the Indian Diaspora, that is the same type of customers even in the foreign market. (Like Jollibee targeting the Philipinos in San Francisco)
Staying aligned with their value proposition- niche products
However, it may detract the company because of the following reasons:
Lose Focus
Time Consuming
Costly

8. What are the reasons why duggal and his team are expanding globally?
Managerial motives: power, prestige, wealth
Value proposition is same across geographic boundaries requiring less ASSESSMENT & ADJUSTMENT
Market seeking- catering an undifferentiated customer segment and competing with similar competitors
Drawback: short-run decline in share price

9. What are the domestic competencies that dabur can leverage in a global market?
Dabur can leverage their strengths in the foreign market . Therefore, we can use the internal analysis (SW) :
Ayurvedic products
Over 100years of experience
Established R & D capabilities (5% of sales revenue)

10. Is the company’s template for globalization workable?
YES, it is workable!
Building on existing experience (protect the past)
Similar product portfolio & similar customer base
Focus market segmentation- better utilization of resources & 34% growth in 2006
(Exhibit-7)
Focusing where they are & where they want to go? [Nigeria-China]
Margin accretive, even in the long run

11. Why is the template not working in nigeria?
Liability of Foreigness:
Absence of Indian Diaspora
Gaps in standard (soaps & mosquito repellants)
Manager’s overconfidence (Exhibit-10)[High competitor & implementation risk]
Toothpaste is not a focus product for Dabur in any international market

12. Recommendation for dabur to address the nigerian market
Moment of truth
Leap of Faith
Developing localized products for the Nigerian market
Creating Awareness
Knowledge
Create Value
Acceptance

14. APPENDIX
Exhibit-2
It had opportunities in the global market with small revenue share. Dabur could not penetrate the foreign market through exporting only, rather it needed to build subsidiaries.
Exhibit-1
Intense competition in local market, so it would not be easy to gain market share of sales like those of the top competitors.
Dabur can do promotions, informative advertisements and
repackage small samples to create awareness among the
mainstream African people. Thereby, it can align to create value
and cause customers to switch.