Colgate Prepares to Mitigate Impact of Potential Tariffs on Mexican-Made Toothpaste
New York, NY - In light of the announcement of proposed 25% tariffs on Mexican imports, Colgate Palmolive has outlined plans to minimize the potential impact on their U.S. toothpaste business, which is primarily manufactured in Mexico.
"We're actively exploring potential mitigation strategies," said CEO Stan Sutula during a call with analysts.
Colgate holds approximately one-third of the U.S. toothpaste market, with popular brands such as Colgate Total and Colgate Optic White. The proposed tariffs could affect the company's imports of raw materials, finished products, and retaliatory tariffs, Sutula noted.
To mitigate the potential impact, Colgate is considering diversifying its supply chain by increasing domestic production and partnering with co-manufacturers. The company has excluded tariff costs from its financial guidance for fiscal year 2025.
Colgate's announcement comes amidst uncertainty over the implementation of tariffs. While some companies are accelerating imports to preempt the levies, others are adopting a wait-and-see approach due to potential costs.