that is not a cause for concern. Most of the employees in a company like Fem are from the front line –

ZEE BUSINESS BEST B SCHOOL SURVEY

If we may be allowed to take a slight tangent at this point, Duggal shares an interesting anecdote with us regarding acquisition of a company like Fem. When we asked him how they could take on the entire work force of this company in times of slowdown where companies are actually looking to retrench, Duggal says that in this sector, that is not a cause for concern. Most of the employees in a company like Fem are from the front line – the sales force, where the attrition levels are rather high, upto 30%. With that statistic, Duggal says, "All we have to do is not recruit for 2-3 years and we will be back to normal!" This does point to a major challenge in the FMCG sector, the job is tough and not as lucrative as segments like insurance and telecom products, and so there is a perennial shortage of talent.

Coming back to the core logic behind the Fem acquisition, Dabur already has a brand, Gulabari (rose water), which has a niche herbal positioning in that segment, but it was felt that to take further advantage of the category, a new brand had to be either launched or acquired.


For more articles, Click on IIPM Article.
Source : IIPM Editorial, 2008
An Initiative of IIPM, Malay Chaudhuri and Arindam Chaudhuri (Renowned Management Guru and Economist).


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