World razor industries have been struggling for over the past few years. Current economic crisis have worsened the situation further .Industries two giant companies Gillette and Schick are battling to overcome the bad days. Though Gillette dominate the world market , but Schick is gradually shaving the Gillette’s market share. Schick has been accused of violating patent rights of Gillette’s famous mac3.
Gillette dominates the world razor industry with 72 per cent market share. Schick is the second largest but meager 15 per cent share followed by BIC 6 percent market share.
Razor may seem very simple to make, but it is extremely sophisticated technology. For each new design you must have custom-built machinery. After frequently testing the model it is introduced in the market. A little margin of error may cost you heavily
Gillette a well famous brand spends enormous amount in R&D. In the mid-1990s, Gillette spent $1bn (£622m) on developing the initial Mach 3, including $250m on manufacturing specialized tools.
Patents are strictly watched in the razor industry, where the sums spent on research and development are surprisingly large. Recently Gillette sued Schick for violating patents rights.
Gillette has enough reason to go against Schick. Few days back Schick introduced world first four blade razors. The position of Quattro’s blades, Gillette argues, breaches patents established during the development of the Mach 3.
Gillette has claimed to invent Quattro’s design, and is demanding that Schick’s flashing new implement is withdrawn from the market. It’s a severe crime to breach of our patent,” says Gillette’s communications director, Michele Szynal. “It is irrelevant how many blades a razor has: what counts is how they are positioned. It is vital we respond to protect our intellectual property and we are confident that the court will find in our favor.”
However Schick considers its Quattro is a breakthrough and try to clear its position by saying that Schick has spent large sum of money to invent the world first four blade razor and expecting to make a large impact and will change the shape of the market.”
World leading razor producer invest a large amount of money on R&D. A fierce battle goes on among the companies and neither company actually reluctant to disclose their budget on R&D.
Winning the case against Schick will be a great advantage for Gillette. Schick would be forced to give Gillette millions of dollars generated by sales of Quattro over the coming months. And, of course, Schick would have also wasted hundreds of millions of dollars on research and development of a product that cannot be sold.