The strengthening of the US dollar has been hitting Procter & Gamble hard as the company reported its biggest sales drop in seven quarters.
The company also cited weak demand especially in the overseas market as the reason behind the low sales performance.
P&G's sales dropped to 12 percent for the quarter to only $16.53 billion, slightly lower than analysts expectation of $640 million. Channel News Asia noted that among its worse-performing products performance are in the beauty, baby care, and grooming segments.
Although the company recorded a loss, its profit is still high and beating analysts expectation for the quarter.
According to the Economic Times, analysts had expected that the company's average earning per share will only be 95 cents per share which will give a revenue of $17.17 billion.
The company said that it will change its product focus as a way to gain more sales against other competitors. According to the company's spokesperson, P&G will focus its sales on Gillette shaving products, Pampers and detergent for its market outside the US.
According to FOX News, Unilever and Colgate are dominating the markets outside of North America as both brands have varieties of products under its name.
An analyst for CLSA, Caroline Levy, said that the company should also start to decentralize its operation to ensure their overseas operation runs smoother.
Levy said that "The more strong people they have with a local understanding of running their business, the better chances they have of not being late with their innovation and marketing strategy."
P&G needs to start tapping into the countries with emerging market such as China. By doing so, P&G will be able to establish and get its brand recognize by people in the country faster before other brands.
The company should also start to move into the online business as the trend of e-commerce is on the rise in China, and sales from that sector have been increasing every year.
The poor sales performance caused the company's shares to drop by 1 percent on Friday to $74.02 per share during the early trading session.
P&G also announced that its full-year revenue forecast is cut by 5-6 percent as they anticipated that the effect of strengthening dollar will still be in effect for the next quarter.
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