01.01.70

Colgate-Palmolive is navigating a finical tightrope, as it raises prices in North America for the first time in more than two years.

The associates, best known for its toothpaste and dish soap, said Thursday it had raised prices in North America by an customarily of 0.5 percent in the fourth quarter, after cutting prices every rooms since the summer of 2009. The news emerged as the company reported a 5 percent worsening in net income that it blamed on higher costs for raw materials.

Raising prices can be a touch-and-go move, because cash-strapped customers can drop even their favorite brands to retrieve a few cents. Paychecks are already stretched thin and the government's most recent data on jobs, also released Thursday, show that the issue of people seeking unemployment benefits rose last week. There are signs that the control is healing, but raising prices in North America had been something that Colgate, until recently, had been unwilling to try.

Many of Colgate's rivals raised prices last year, as well as many restaurants, clothing stores and other industries. But Colgate had captivated a different strategy, raising prices in fast-growing Latin America, where customers seemed acquiescent to stomach the higher costs, but lowering prices in North America through discounts and other promotions.

Source: Sioux City Journal

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