Colgate-Palmolive's Procurement Group

According to Colgate-Palmolive's Web site, they are very committed to saving money on supply costs. They save on these costs year after year by buying from all kinds of companies from all over the world. These include man- and women-run businesses as well as minority-run businesses. Colgate strives for good supplier relationships that will surprise the stakeholders by lowering supply costs and thus making more profit.

By decreasing supply costs, Colgate-Palmolive are be able to spend more money elsewhere in place that more money is needed, or they are able to make the cost of the product lower and more affordable to the consumers. This, in turn, increases competition because people do not want to spend a lot of money on a product like toothpaste. Lowering costs for the consumer could switch some loyalties and confirm others.

http://www.colgate.com/app/Colgate/US/Corp/ContactUs/GMLS/HomePage.cvsp

Scented Consumer Products Shown to Emit Many Unlisted Chemicals

A study was recently done by University of Washington discovered that widely used fragrance products give off many chemicals that are not listed on the label, including some that are considered toxic. The study analyzed air fresheners, laundry products, fabric softeners, soaps, hand sanitizers, lotions, deodorants, all-purpose sprays, and dish detergent.  It was found that 25 commonly used scented products emit an average of 17 chemicals each. About 133 chemicals were detected and nearly a quarter are classified as toxic or hazardous under federal law. Researchers found that even some of the “green products” emitted just as many hazardous chemicals as other products. It was also found that more than a third of the products emitted at least one chemical classified as a probably carcinogen by the EPA. Manufacturers are not required to disclose any ingredients and the only product label was ethanol.

Although the study makes no claims about the possible health effects it was found in other surveys that about 20 percent of the population reported adverse health effects from air fresheners and about 10 percent complained of adverse effects from laundry products vented to the outdoors. If more people investigate these products, consumer product companies will be able to be blamed for possible health hazards. It’s surprising to hear that companies are willingly putting chemicals into their products that are considered toxic. As a consumer I find this very disturbing that I could potentially be breathing in or using products with toxic chemicals every day.

http://www.sciencedaily.com/releases/2010/10/101026091559.htm

Growth in Profit, But Concerns Over Sales

Though margin profits have improved this past third quarter, according the Wall Street Journal, many companies are worried about the future prices. Commodity prices are on the rise, forcing many businesses to make difficult financial decisions. Whirlpool Corp. has decided to lower prices of products for consumers even though input prices rose. In the consumer products market, Procter and Gamble gross margin fell from 52.6% a year before to 51.8%. P&G are seeing their costs increase due to higher commodity costs, especially from paper pulp and plastic resin; the company is off-setting these costs by seeking out other areas within the company to cut expenses and to avoid raising prices. Though many businesses have seen an increase in profit margins, economists are skeptical as to how this will aid in lowering the unemployment rate or if the economy will see such increases next year.

Many of these companies claim to be cutting back within their businesses and lowering prices for their consumers, but they are increasing their marketing expenses (WSJ). Will the possible benefit of reaching out to more customers through advertisements override the expenses of the actual marketing?

http://online.wsj.com/article/SB10001424052748704477904575586181999090898.html?mod=WSJ_Consumerproducts_leftHeadlines

L'Oreal's Mission

According to L'Oreal's web site, they have a pretty simple mission:

"At L’ORÉAL, we believe that everyone aspires to beauty. Our mission is to help men and women around the world realize that aspiration, and express their individual personalities to the full. This is what gives meaning and value to our business, and to the working lives of our employees.
We are proud of our work."

Overall, this mission is all about helping the consumer. If the consumer is happy, they are happy. They do this by making their products so that consumers can use them and be beautiful, inside and out. This mission, though not as detailed as some of the others we have seen in class, tells the consumer who they are and why the consumer should by L'Oreal's products. If they didn't have a mission statement that told the people that L'Oreal cares, people might not be so inclined to buy from them. This adds to competition because without a mission statement like this, they would not have as many customers and would not be such a large competitor in the Consumer Products Industry.

http://www2.lorealusa.com/_en/_us/html/our-company/mission.aspx?

P&G Corporate Structure

The P&G website portrays what aspects of the company’s structure make the consumer-packaged goods corporation a global and local power. P&G divides its efforts into four primary groups: Global Business Units (GBU’s), Market Development Organizations (MDO’s), Global Business Services (GBS’s), and Lean Corporate Functions. While the Global Business Units puts a strong focus on sustaining profitability in a more global sense, that is concerning shareholders, the Market Development Organizations are responsible for truly knowing consumers and retailers in specific regions. In addition to these two branches, the Global Business Services is more concerned with human resource management. P&G understands that the greater the talent level that its corporation reflects, the higher its productivity. The corporation hopes to reduce costs by sustaining these “best-in-class” partners. The last branch of the structure, the Lean Corporate Functions branch is concerned with continually innovating within the business to ensure improvements. P&G functions in a very competitive market, one in which product differentiation may be a predominantly a function of pricing strategies. For this reason, innovating products and maintaining brand awareness and loyalty is crucial. P&G’s corporate structure seems to impressively combine advantages of horizontal and vertical organizational structures. The company has a hierarchy; one can see this in its global functions versus internal motives; however, the branches incorporate a broad range of personnel, which fosters creativity and collaboration between partners.

http://www.pg.com/en_US/company/global_structure_operations/corporate_structure.shtml

Graco's Stroller Recall

On October 20^th, Graco recalled about 2 million of its strollers. In-between 2003 and 2005, four babies were strangled due to Graco’s stoller models. It is said the US Consumer Product Safety Commission (CPSC) warned the industry about possible deaths in strollers and urged companies to redesign their strollers. The CPSC ordered the recall today after a fresh review of old cases involving strollers and finding that additional fatalities can be tied to Graco Products. CPSC spokesman, Scott Wolfson, recently stated, "We reached a point where we needed to do a recall of this product to help prevent any further harm to children.” In March of this year, Graco also recalled 1.2 million highchairs which was prompted by 464 incident reports and 24 injuries.

As a consumer, it seems as if Graco is not a very good company to trust, especially when concerned about infant safety. It is likely that these recalls will continue to be very detrimental to Graco’s company and their customer satisfaction.

http://www.sfgate.com/cgi-bin/article.cgi?f=/g/a/2010/10/20/bloomberg1376-LAK8OS07SXKX01-5L4IHVTMGROHLKM2V9H2QUKA4H.DTL

P&G Puts Marketing Spotlight on Newer Products

According to the Wall Street Journal, recent consumer trends have affected the consumer product market, enough to change companies’ marketing techniques. Consumers have been opting towards purchasing cheaper private-brand products, which are sold and produced directly by retailers, rather than spending the extra money for company manufacturers’ products. Companies, P&G in particular, have started reacting to this trend.

P&G, under its new market leader Melanie Healey, has launched a promotional campaign called “Have you tried this yet?” designed to spur consumer awareness and revamp consumer loyalty. The company will open a temporary store in NYC at which location customers will have the opportunity to try a variety of product lines. The campaign will also establish a website in which customers can post reviews of the products. If this campaign is successful, P&G will regain its customer loyalty. At first, its products perhaps were only a customer preference; however, by showing such consideration for its customer base, P&G hopes to have customers insist on its products.

http://online.wsj.com/article/SB10001424052702304011604575564420769116624.html?mod=WSJ_Consumerproducts_leftHeadlines