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Croda
Croda is a large international manufacturer of specialty chemicals for the personal care industry. The Croda products WSP stocks are Polawax and Crothix. For some time, we have had Super Sterol Liquid and Refined Lanolin Oil on our discontinue list.
Croda acquired a smaller company (Uniqema) with a sophisticated distribution network. Since purchasing this smaller company, Croda has increased profits. Which is good for them…but ultimately, has turned out not so good for our industry.
Joe Pavlichko, Croda’s VP of Marketing in the USA, has decided to limit the companies that will be authorized to distribute their products. These authorized distributors will be extremely limited and will NOT include any of the internet suppliers such as WSP. None of the authorized distributors will be authorized to break product down to smaller sizes such as 1-3 pounds. Joe has also decided that Croda will no longer allow “co-op’s” on their products.We examined all legal avenues for challenging this decision and found that since Croda owns the trademark and patent on most of these products, they are likely within their right to limit what a customer does with the product (in terms of resale). Therefore, effective tomorrow (10/29/2007), WSP will no longer carry Croda products. We will immediately begin to source replacement products.I have been asked if larger companies such as Lush are concerned about the “Burt Bees Phenomenon” and influenced Croda’s decision. The question refers to large companies trying to stifle smaller manufacturers so they cannot grow to a significant size and provide significant competition. My answer is that I really don’t know. It is an interesting question. I know that we have customers and sources inside many of these larger companies. I will encourage them to contact us if they come across any information that supports this. It would make for a very interesting legal argument. One that we would be interested in exploring further with other distributors that have been “cut off”.I do know that NOT using Croda products does not mean you cannot grow your business to a significant size. All formulas can be tweaked and reformulated. Croda’s products are good but they are not the end all. There are many, many wonderful products on the market. Our Emulsifying Wax has always outsold Croda’s Polawax.
Wishing You Much Success!
Debbie May
http://www.wholesalesuppliesplus.com/
Note: I do want to emphasize, if you are an end user and currently purchase larger sizes direct from Croda, their recent distributor decision will not affect you. This decision only affects resellers and distributors.
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3 part comment here. #1 Re: Croda cutting off the smaller suppliers: I saw this coming almost 2 years ago and not only from Croda's end. It's all the smaller manufactuers of extracts and specialty chems, etc., being brought up by the big chemical or personal care companies. Loreal's been doing it too. And they are following the Golden Rule: Whoever has the gold, makes the rules. They don't have to supply anyone they don't want to. Also, the fragrance suppliers have also been given some funky flack. Lately, a whole lot of specialty raw materials are not under patent anymore. So it's just a matter of the research and finding new suppliers. Also, if Croda and the other spoilsports sell to any distributors that do repackage (like Ruger) then we may pay a bit more, but we may get what we want. #2. Re: The Burt's Bee's thing: Burt's is owned by an investment firm, just got sold to another last week. They have been a "Corporate mindset" entity for quite a while now. They want to set their standards as THE STANDARD, even though their standards are questionable too. I for one, am very leary of those companies (both large and small)who continually do the "we are holier than thou" mantra. They they start yelling it across the world, and then they start trying to dictate it to the rest of their industry. #3. Also, the larger, mass produced players do not want competition because the smaller and usually handmade B&B makers are better and fresher! The more of a product you make (mass produce) the more crap one has to add to keep it viable, preserved, etc. on the shelf and in the consumer's end use. Just ask yourself how long has the "Natural" product you bought at the healthfood/natural/B&B Boutiques store been sitting in the merchandising distributor's warehouse? Then ask how long did it sit at the manufactuer's warehouse? Then ask yourself this: If this product is in ALL the chain or independent healthfood/natural/B&B Boutiques in MY area, multiply that exponentially by the other stores in your state, then by the 50 states. Do the math...So just HOW FRESH is that whipped scrub or bottle of lotion anyway?? The good part about this is like you said though, no supplier or raw material is the be all/end all. It will force us to get creative and invent. That's how so many things have been invented. (the b#tch is getting that invention patented!) Btw, I want to thank WSP in advance for looking out for us in the best way possible. I have always been well pleased with the products and service.