One of my greatest responsibilities as a parent is to teach my daughters how to have healthy relationships. My wife and I talk about gratitude, support, empathy and the different types of love but the one thing I seek to really teach my daughters is the concept of boundaries. Relationships are healthiest when based on mutual benefit and fair give and take. Where it gets difficult is when we enjoy some benefits like companionship and laughter, but still are subject to the other party crossing your bounadaries like that same friend borrowing money and never paying it back. An unhealthy relationship occurs when we get on unsteady ground and allow our boundaries to be crossed because we enjoy aspects of the relationship such as companionship and financial security.
This blurring takes a more ominous turn in a volatile relationship. For example, a wife may stay in a marriage because of the economic benefits, but the womanizing husband abuses her trust and commitment by being unfaithful. She’s tracked by a false sense of security. How then do we correct the situation?
We must stand our ground.
My favorite description of how to set boundaries comes from my mother who attended self-help groups years ago. The saying is-
“Just because you do for me, does not give you permission to do to me.”
Now let’s turn to business.
No one is in business alone. We have employees. We have partners. It’s the efficient combination of these relationships that creates value. We take a raw material and make it into something. Then we add service and quality and ask our sales force to go find a customer. If the customer has a positive experience and finds value, they come back and buy again. If the employer pays well and is not deceptive, then the employees come back the next month and do it all over again.
It isn’t contracts that keep the system producing. It’s mutual benefit and trust. This is a healthy value chain producing products and services for the marketplace. These are business relationships.
But just like in any volatile relationship, sometimes one party seeks to cross boundaries and abuse the relationship to get more out of it.
Last month, my wife picked up some baby shampoo at Walmart. She picked up a bottle of Equate, Walmart’s house brand of baby shampoo pictured here next to an actual bottle of Johnson & Johnson baby shampoo.
See any resemblance?
Retailers and manufacturers are partners in a value chain. The system works because an entrepreneur creates a product, then looks for a way to distribute the product. If it’s a consumer product, they partner with retailers and share in the revenues- typically giving the retailer 40% of the price. If the product is of value to consumers, the consumers come back to the retailer again and again.
Over the past decade, retailers searching for more profits, created their own brands. The white label or “house brands” of products compete with their manufacturer vendors. That seems fair. I can choose to buy Green Giant English peas, or I can buy Laura Lynn. They are merely competing and I get to be the judge on taste, quality and price.
What WalMart does crosses the line, in my opinion. They are essentially copying everything about Johnson’s baby shampoo and trying to confuse the consumer that it’s identical. Johnson & Johnson created the category of baby shampoos. J&J’s research led them to the golden color. Their testing and design work led them to move to a tear shaped bottle to echo the theme of “no more tears.” This product package design, in place for more than three decades, is iconic and indisputably linked to J&J’s baby shampoo.
Now Walmart comes along and not only hires a contract manufacturer to white label a similar formula, they rip off J&J’s packaging ostensibly for the express purpose of fooling the consumer into buying the their fake version.
This is a rip off of a vendor partner. To me, it’s violates the spirit and trust of the partnership.
Johnson & Johnson is now in a volatile relationship. It in enjoys and needs the benefits of the massive sales Walmart provides, but it’s at a power disadvantage and cannot prevent (or chooses not to try) the theft of its product identity.
The fact is, J&J is largely to blame. They are not victims. Like the humiliated housewife, they stay silent on Walmart’s abuse and let it continue – thereby binding other vendors and themselves to continual incursions from the retailing behemoth.
What should they do you ask?
J&J should divorce Walmart.
You will always suffer to the extent you are willing to be abused. What’s true for personal relationships is true for business relationships. The lesson for my daughters is the same lesson for Johnson & Johnson- don’t sanction with your silence, this type of volatile relationship. Leave it. Get out. Pull your products. Next, sue Walmart for trying to confuse consumers.
Bully’s hate the light of day. Take a stand. That’s what I’d want anyone to do.
That’s my opinion.