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    Top Companies Report

    13. Clorox

    ...

    07.02.08

    Oakland, CA
    510.271.7000
    www.thecloroxcompany.com
    Sales: $2.2 billion



    Sales:

    $2.2 billion for household and industrial and institutional cleaning products. Corporate sales: $4.8 billion. Net income: $501 million.

    Key Personnel:

    Donald R. Knauss, chairman and chief executive officer; Larry Peiros, executive vice president and chief operating officer, Clorox North America; Beth Springer, executive vice president, strategy and growth; Frank Tataseo, executive vice president, functional operations; Warwick Every-Burns, senior vice president, international; Dan Heinrich, senior vice president, chief financial officer; Jackie Kane, senior vice president, human resources and corporate affairs; Laura Stein, senior vice president, general counsel; Tarang Amin, vice president, global health and wellness; Tim Bailey, vice president, product supply; Tom Britanik, vice president, general manager, U.S. auto care and Brita; Robin Evitts, vice president, chief information officer; John Hommeyer, vice president, growth; Tom Johnson, vice president, controller and chief accounting officer; Grant LaMontagne, vice president, sales; Glenn Savage, vice president, general manager, laundry, home care and professional products.

    Chief Technical Officer:

    Wayne Delker, vice president, global research & development.

    Chief Marketing Officer:

    Derek Gordon, vice president, marketing.

    Major Products:

    Home care—Clorox, Clorox Clean-Up, Formula 409, Handi-Wipes, Lestoil, Liquid-Plumr, Pine-Sol, S.O.S., Tilex. Laundry additives—Clorox, Clorox 2. Auto care—Armor All, STP, Tuff Stuff. Professional products—Clorox, Clorox Clean-Up, Formula 409, Liquid-Plumr, Pine-Sol, S.O.S., Tilex.

    New Products:

    Burt’s Bees (acquisition), Clorox GreenWorks.

    Comments:

    Corporate sales rose 4% and net income rose nearly 13%. But the big news at Clorox, like so many other companies in The Top 50, is its renewed focus on going green. During the past year, the company purchased  Burt’s Bees for $925 million in late 2007 and rolled out Green Works, a line of cleaning products made from ingredients derived from coconut and lemon oil. The products are biodegradable, non-allergenic, packaged in bottles that can be recycled and their formulas are not tested on animals.
       
    With the acquisition of Burt’s Bees, Donald R. Knauss, chairman and chief executive of Clorox, said his company is entering into a strategic phase that will enable it to expand into the natural/sustainable business platform.
       
    “The Burt’s Bees brand is well-anchored in sustainability and health and wellness, and we believe it will benefit from natural and green tailwinds,” he said in a statement. “It’s in an economically-attractive category with a margin structure that will be highly accretive.”
       
    Yes, things are looking up at Clorox, or should we say heading north. Last year the company completed an in-depth review of its business, defined what winning means for Clorox, identified its highest value opportunities and made corporate strategy choices. That work culminated in its new Centennial Strategy, named for the company’s 100-year anniversary in 2013. Central to the strategy is double-digit annual percentage growth in economic profit—a goal the company calls its “true north.” To get there, the company has identified four key strategic choices:
        1. Be a high-performance organization of enthusiastic owners;
        2. Win with superior capabilities in desire, decide and delight;
        3. Accelerate growth in and beyond the core; and
        4. Relentlessly drive out waste.
       
    The first choice is ensuring that all Clorox employees are performing at the top of their game and enjoying their job. To accomplish that, the company is making it easier to make decisions quickly through greater role clarity, using economic profit to allocate resources and engaging employees on a rational and emotional level.
       
    The second choice means Clorox will strive to be the best at driving demand creation and building consumer lifetime loyalty through desire (creating strong brand messages), decide (winning the consumer over at point of purchase with innovative packaging and merchandising) and delight (creating products that exceed consumer expectations).
       
    To accelerate growth, the company is pursuing business in growing markets with good profit. Clorox is already No. 1 or 2 in 63 categories; now the company wants to expand that successful footprint in other areas such as health care facilities and expand the product range into countries where Clorox already does business.
       
    Finally, to drive out waste, Clorox is taking a disciplined approach toward process improvement, particularly in the supply chain. At the same time, a strong cash flow and capital capacity will be utilized to invest in profitable growth and drive shareholder responsibility.
       
    For fiscal 2007, sales within the household group rose 1% to $2.1 billion. Specialty group sales rose 5% to $2 billion and international sales were up 12% to $700 million. In home care, Clorox Wipes was the No. 1 brand in the category with a 48% share, for the 52 weeks ended Dec. 30, 2007, according to Information Resources Inc. Pine-Sol was No. 1 with a 30% share and Tilex was No. 1 with a 20% share. These and other brands have helped Clorox become the No. 2 company in the segments it competes, trailing P&G, but ahead of Unilever, Colgate, Reckitt and Church & Dwight, say company executives.
       
    For the nine months ended March 31, 2008, corporate sales rose 8% to nearly $3.8 billion.  

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