COLGATE-PALMOLIVE Philippines Inc. says it is open to reinstating its manufacturing operations in the country, but the decision is anchored on the next administration’s capability to address the high electricity and water rates that continue to cripple the competitiveness of local industries.
“I hope we could have a factory here but it depends on the [adequacy] of local infrastructure. One of the key things is electricity. We have expensive electricity [rates] in the Philippines and water [rates] are also not cheap here. The government needs to address these if we want to provide competitive costs,” Stephen Lau, vice president and general manager of Colgate-Palmolive Philippines, said in a press briefing late Monday.
He said the government should improve infrastructure in the Philippines and bring down electricity and water rates “so that more international companies would continue to build their supply chain in Southeast Asia.”
He said reopening the factory was possible as long as the company was assured its business would be able to grow. “I hope that day would come,” he said.
The firm closed its production facility in Makati in 2008 and moved to Thailand and Malaysia as part of its parent firm’s plan to streamline operations. The site in Makati now houses the upscale Proscenium project of Rockwell Land.
Currently, Colgate-Palmolive products being distributed in the Philippines are sourced from Thailand, China, India and the United States.
Lau said the parent firm continued to bank on Asia for its expansion since the region was deemed the growth engine of the global economy.
Colgate-Palmolive products are market leaders in their respective categories in the Philippines. The Colgate toothpaste brand covers roughly 60 percent market share while the Palmolive shampoo brand enjoys a 27-percent market share.
For this year, Colgate-Palmolive is targeting another double-digit growth in revenues on the back of growing demand and rising consumer spending capacities among Filipinos.
“The Philippine market overall, I believe, still continues to have a high single-digit growth in oral and personal care categories. But this year, growth (in these categories) will be better because according to history, during the election period, people have more disposable income to buy personal care products,” Lau explained.
“Whenever it is an election year in the Philippines, the personal care category usually grows by more than 15 percent, which is higher than the normal market growth of a single digit. I am betting on the [growth in the] Philippines right now because, for one, China is not doing well because its economy is slowing down. Last year, the Philippines hosted the Asia Pacific Economic Cooperation meetings, and the Pope visited. But I just hope that the infrastructure will be better so that more investments will come in and more people will have jobs and more income for their families,” he said.
Meanwhile, the company also announced on Monday its partnership with Operation Smile, a volunteer-based international medical charity dedicated to providing free reconstructive surgery and related healthcare to children with oral cleft.
Under this partnership, Colgate Palmolive will donate P5 for every purchase of participating Colgate products bought from Puregold retail stores from Feb. 15 to April 17. The amount will be donated to Operation Smile.
Lau said they were initially targeting to help yearly at least 1 percent of those born with deformities. It was estimated that one in every 500 new born babies in the Philippines has oral cleft.
The company is targeting to increase the number of beneficiaries under this partnership over the next several years.
“This collaboration with Operation Smile is only one of several activities that Colgate-Palmolive Philippines will implement on its 90th year (in the country). We have allocated significant resources for this year-long campaign of giving back to the Filipinos,” Lau said.