Colgate’s Distasteful Toothpaste

1458 words 6 pages
1. Identify the major strategic and ethical issues faced by Colgate in its partnership with Hawley and Hazel.
In August 1985, Colgate bought a 50 percent partnership in the Hawley and Hazel group, an Asian company leading the toothpaste markets of China, Taiwan, Hong Kong, Singapore, Malaysia and Thailand. This strategic move was initiated because Colgate already had a strong presence on foreign markets and notably in Europe, so it decided to enter the Asian markets with a partnership with a strong and well-known company. Even though this was a 50 percent partnership, Hawley and Hazel kept the right to make the major decisions, which Colgate could not do.
Soon enough, Colgate was faced by a major issue: Hawley and Hazel’s main product
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Unfortunately, things escalated very fast after the ICCR started a fight against the company’s offensive product back on the domestic market.
Letting things go was not the right solution. Civil rights groups and minorities should be taken seriously because they can be really powerful. In this case for example, even the House of Representatives in Pennsylvania urged the company to change their name and logo.
In my opinion, Colgate should have made research before accepting the partnership with the Hawley and Hazel group. This partnership was the best they could have had since they are leading the Asian market, but Colgate should have anticipated the “Darkie” issue either by requesting a change in the name and logo prior the partnership or by making sure they could take important decisions in the event of a problem such as this one.
Unfortunately, civil rights groups started criticizing the company and the partnership with its clauses had already been implemented. Therefore, I believe that to handle the situation Colgate should have taken action right from the beginning in order not to damage its image in the domestic market like it did. Taking the right side on this issue would have allowed the company to influence Hawley and Hazel and maybe they would have considered changing the product’s name and logo. Another solution would have been to cancel the partnership in the event that