The History of Gillette Company

Brand Stories & Strategies Beauty & Wellness Industry 08.01.2016  0 36 0
The History of Gillette Company

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All well-known large corporations today started out as small businesses at some point. The company Gillette is one of the most famous brands for selling razors and skincare products. The company's headquarters is located in the United States, in the state of Massachusetts.

Since 2005, the corporation was acquired by Procter & Gamble. The new owners paid $57 billion for the opportunity to use Gillette as their subsidiary.

Creation Story

The company was founded in 1901 by King Camp Gillette. At that time, it was named "American Safety Razor Company." The idea of creating razors with replaceable blades came to King spontaneously. During a routine shave, his blade became dull. Razors required constant maintenance and timely sharpening, a task usually left to a skilled craftsman.

King recalled the words of William Painter: "Find out what people need most and make it accessible for everyone to use." This is when the unexpected idea of creating a razor with replaceable blades emerged. The idea was excellent, but at that time, it was very challenging to produce a durable and thin metal.

After spending a significant amount of time and nearly all his available budget, King reached out to various engineers trying to find a solution to the problem. Six years later, he came across William Nickerson, the inventor of machines for quick and reliable sharpening of metal strips.

Production started in 1901. Sales were challenging initially. By the end of the year, the company changed its name to "Gillette Safety Razor Company." However, by 1903, only slightly over 160 razors were sold. Fortunately, customers quickly appreciated the quality and convenience of using disposable products. Over 90,000 razors were sold the following year. The low cost and safety of use caused a sensation in the market.

Gillette razors quickly gained popularity. Company employees practically gave away razors on the streets, making profits from replaceable blades. Within a short period, King became a millionaire. In just five years, Gillette earned over $13 million. This was a significant amount of money for that time.

The absence of competitors played a significant role in the company's profits. The patented technology was only used in King's own facility. Within seven years, a distribution network was established throughout Europe. The right to supply Gillette razors to the US military and participants of World War I played a substantial role. The decision was made due to the quick and safe shaving provided by the razors. The opportunity to try the razors ensured the emergence of new customers among soldiers after military actions.

By 1915, the company was selling over 500,000 razors per year. Replaceable blades were sold in packages and spread incredibly quickly. Over 10 million blades were sold annually.

In 1918, Gillette received the largest order from the government. The military purchased over 35 million blades for servicemen. After the war, the company became a global brand, recognizable in all European countries.

By the late 1920s, King had amassed a vast fortune. However, all his assets were in the form of stocks. This played a cruel joke on the company's founder. In the 1930s, the "Great Depression" began, causing many firms to go bankrupt. King's stocks lost their value, and in 1932, he died a poor man.

Nevertheless, the company managed to survive, and even after the challenging times, it remained profitable.

Business Idea

Perhaps the most interesting feature of Gillette was the price of their razor blades. The price was below the cost of production. The idea was brilliant. It involved capturing the market with cheap items, while the main profits were to come from replaceable blades. This scheme is quite popular nowadays. Large companies, such as Sony, use it. It can be said that King not only created a new product in demand among all people but also established the perfect business model of that time. You can also read about other ideas on newbusinessideas.com.

Over time, advertising covered almost the entire world. The advantages of the new razors were highly appreciated, and the low price was accessible to all social classes. The company's innovative developments played a crucial role. They were patented and left no chances for competitors.

Ultimately, the company became a pioneer of disposable items. Over time, products were manufactured worldwide, allowing people to purchase necessary household items at a low cost.

Gillette Today

King was a very ambitious person. He disliked the established capitalism in the US at the beginning of the 20th century. By producing new razors, he tried to create a new concept that would bring about changes in societal norms. The accessibility of the company's products influenced other enterprises. People no longer aimed to profit from expensive items affordable only to the upper class. Products became accessible to all citizens.

Today, Gillette has become one of the largest companies in producing skincare products. Items are produced not only for men but also for women. The acquisition of the company by one of the largest corporations, P&G, had a positive impact. Collaboration with similar enterprises led to new heights, expanding the customer base and increasing revenue.

The company became an innovator, continually offering new products and solutions that simplify our lives. Throughout its long existence, Gillette has not faced any criticisms or a decline in production quality. This marks a true success. Make sure to share this article with your friends and colleagues. They would surely be interested in learning how the razors they use every day came into being.

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08.01.2016  0 36 0
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