Colgate-Palmolive Co. Buying Tom's of Maine

When a big corporation buys a little one, separate visions swirl around uncertainty. Wall Street speculates about how long it will take for "economies of scale" (downsizing, outsourcing, product rationalizations, centralized purchasing, and so on) to be felt. Customers and employees who had long been delighted by the small company's products are filled with trepidation. The big company issues reasuring press statements, mirrored by the little company, and the world goes on. But more than one future is plausible in this, and other cases. Scenario One: a familiar dance unfolds as " Colgate-Palmolive Co. announced Tuesday it's buying Tom's of Maine, the leading maker of natural toothpaste..." "The $100 million cash deal for privately owned Tom's of Maine, which got its start in 1970 by producing a phosphate-free laundry detergent, reflects Colgate's strategy of focusing on the higher-margin oral and personal care businesses". This announcement unerscores a trend common now in Europe and the US. Organic/natural product company produces high margins in its food or personal care category; big company pressured by shareholders to get bigger margins and up sales volume; big company buys small company, etc.

What we're waiting for is a Scenario Two, where, aided by the big company, the little one can expand its markets, innovate around sustainability principles, and start to change the culture of its new owner to help "mainstream the green" and bring jobs back to the US. That doesn't happen by just sending emails and shifting executives around. Culture change and strategy shifting has to circumscribe product designers, formulators, market managers, and so on. Maybe we can get some new TreeHugger readers? Maybe even the dreaded "Food Scientists?"

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