Proctor and Gamble 2008 Annual Report Download - page 19

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P&G researchers are continually searching for new formulations
and designs that lower cost, improve performance and increase
value for consumers. For instance, new formulations of
laundry detergents signicantly reduced our use of packaging
material, leading to cost savings, more consumer convenience
and less waste for the environment.


We are building more local, multi-category manufacturing
plants closer to the consumer, enabling local materials
sourcing, lower distribution costs, and lower import duties.
This also helps P&G build strong international relationships
and deepens our understanding of local consumer needs.


We are generating cost savings in shipping and warehousing
while improving service levels to customers by optimizing the
Company’s nished-product supply chain, including cutting
the number of distribution centers in half.


All of P&G’s major global brands have changed their mix
of marketing tools to reach target consumers more cost
effectively. In Feminine Care, for instance, Always and Tampax
have reduced TV advertising budgets in favor of higher-return
magazine ads and our “BeingGirl.com” website.


P&G is reducing go-to-market costs with streamlined
organization designs in developing markets, smaller local
organizations, and faster decision-making. We are
implementing these designs in the Latin America, Central
and Eastern Europe and ASEAN markets.


P&G has reduced R&D costs as a percentage of sales,
increased the value of the innovation pipeline and led the
industry in innovation delivered to market by leveraging
a global network of external innovation partners.
&

P&G is driving down overhead costs as a percentage of
sales by reducing senior management positions, cutting the
number of managers on international assignments, moving
toward a corporate shared services structure, and reducing
stafng duplication among global, regional and local
organizations.


TheProcter&GambleCompany 16