Kimberly Clark Corporation

Over the past ten years, revenues increased at a strong 8.5 percent annually, but that figure fell to five percent for the last five years. Earnings outpaced revenues during both those periods, advancing 11 percent over the past ten years, and 5.5 percent annually over the past five years (Gerstein, 1996, p. 942). In December 1995, Kimberly-Clark merged with one of its major competitors, Scott Paper, which became Kimberly-Clark Tissue. This gave the new company increased market share, but also brought with it consolidation and economies of scale that would not have been possible otherwise. The company continues to compete against the much larger Procter & Gamble, but the merger should give it greater resources to compete effectively.

Kimberly-Clark Corporation produces items in three business segments: personal care products (Class I), tissue-based products (Class II) and newsprint, paper and other products (Class III) (Jaffe, 1996, p. 1298). Class I products include disposable diapers, training a

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lark has the expertise to capitalize on this situation by introducing new products. In addition, the acquisition of Scott Paper gave the company greater access to European markets, so the company should be able to realize benefit from increased marketing efforts in Europe. Another source of opportunities for Kimberly-Clark come in the form of private label contracts. Under these contracts, Kimberly-Clark products are manufactured for discounters (such as Kmart or Wal-Mart, for example) and branded with the store's brand. These products sell for less than Kimberly-Clark's own branded products, but offer an opportunity to bring in revenue which would otherwise go to competing private label companies (Wilensky, 1994, p. 23). Threats to Kimberly-Clark come primarily from its competitors, and Procter & Gamble is the main competitor. Just as Kimberly-Clark can take advantage of the market situation by introducing new products, so Procter & Gamble can, as well. The marketing resources that Procter & Gamble can bring to bear on products are significant, and the company recently introduced a new disposable diaper designed to take market share away from generic diapers and Huggies (Gerstein, 1996, p. 942). Other threats to Kimberly-
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Approximate Word count = 2242
Approximate Pages = 9 (250 words per page)

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