Table of Contents
2. Internationalization Strategy of Colgate-Palmolive
2.1 The assesment of the internationalisation of the company
3 2.2 The assessment of geographical characteristics of internationalisation
5 2.3 The outline of the main foreign market entry modes employed by the company
5 2.4 The overview of the enterprise structures and controls used by the company
6 3. Evaluation of academic strategy frameworks for Colgate-Palmolive
8 3.1 Overview of the Bartlett and Ghoshal’s generic strategies framework
8 3.2 Evaluation of the Bartlett and Ghoshal's framework on the company's example
9 4. Conclusion
5. List of Figures
What a “Colgate Smile” is a phrase commonly used as a compliment about one’s smile. It has been popularized throughout the whole world, due to Colgate’s good reputation as a successful business. Colgate, today being one of America’s most successful Fortune 500 companies, has a long history of evolution and complex adoption of various business strategies, which led to its current solid powerful position. As representatives of the Colgate-Palmolive Company, we are pleased to tell you more about the success story of our company through this report. In the first part, we will show how CP slowly internationalized and expanded globally by adapting various strategies to become one of the most powerful MNC’s, to then in the second part, give you details from an academic point of view with regards to the Bartlett and Ghoshal's transnational strategy framework which the firm ended up adopting in order to most efficiently survive in and take over the very competitive market.
2. Internationalization Strategy of Colgate-Palmolive
2.1 The assesment of the internationalisation of the company In 1806, William Colgate started a starch, soap and candles company in New York City and, after 207 years, Colgate-Palmolive stands as one of the oldest and truly global consumer product company. Colgate-Palmolive owns 75 wholly owned subsidiaries in 75 different countries, and operates in more than 200 (Colgate.com, 2013). Colgate had a slow start - after founding the company in 1806 they remained in the American market for more than 100 years. During that time, they were expanding their operations and developing their strategies for the local market, and then in 1914, Colgate opened their first international subsidiary in Canada, a neighboring country, with both geographical proximity and cultural similarities. The company’s international growth was slow during the 1800’s but with all the technological developments that took place during the 1900’s and with the need to enlarge their global market share, Colgate went on its internationalization process. To mention briefly; in 1920 Colgate established operations in Europe, Australia, Asia and Latin America, eight years later, Colgate merged with Palmolive-Peet, and became Colgate-Palmolive-Peet, thus joining forces with another company aspiring for global dominance. In 1985, Colgate-Palmolive entered into a joint venture with Hawley & Hazel in Hong Kong, and ten years later, in 1995, after the end of the communist regime, Colgate entered Central Europe and Russia, thus expanding its operations into the fast growing countries of the region (Colgate.com, 2013).
Figure 1. The expansion and internationalization timeline of Colgate-Palmolive As we can see from Figure 1., Colgate internationalized slowly at the beginning, but picked up a faster pace in the following years. Penetrating geographically close regions or markets that have similar culture and then expanding within that region identifies the company’s pattern for internationalization. First, they entered into Canada. Canada is the closet country to the USA, which is very similar culture wise. In addition, after the Canadian market, Colgate went to Europe and Australia. Europe presented a challenge...
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