Colgate-Palmolive Co. made headlines recently after some tubes of counterfeit “Colgate” toothpaste was found in some U.S. states, but the incident was ”absolutely negligible” for the company, its chief executive said on Wednesday.

“The impact on the business is vanishingly small,” Chief Executive Ian Cook said on a conference call. The goods had to be pulled from a number of dollar stores, but Colgate hasn’t felt much financial pressure from the issue.

Colgate, whose quarterly sales rose to $3.41 billion in the latest quarter, said it can only trace about $100,000 of lost business due to the incident. It spent less than $500,000 to get the product removed from stores.
 
Colgate kept consumers updated on the issue on its Web site and is still working with U.S. authorities to try to get at the root source of the product and stop it, Cook said.

Meanwhile, the company’s Hill’s pet food business is doing well despite an industry-wide pet food recall in March.  That recall included a couple of Hill’s cat food products made by Menu Foods.

    Want a reading on the state of the global luxury market? A new index is being launched to give investors just that. 
    Luxury lifestyle magazine The Robb Report is launching the Robb Report Global Luxury Index to track the stock price performance of a group of luxury goods and services companies from around the globe. It will trade under the ticker ROBB.
    To be included in the index, companies must meet certain criteria, like having a stock that trades on a major U.S. or global developed-market exchange, and a market capitalization at or above $500 million. 
    But what is considered “luxury”? That is determined by CurtCo Media and Robb Report. The following companies made the cut and are included in the index:
    
    - Luxury house LVMH
    - Fashion companies Hermes and Burberry
    - Financial service providers UBS and Goldman Sachs
    - Retailers Saks and Nordstrom
    - Jewelers Tiffany & Co. and Harry Winston
    - Airplane manufacturers Dassault and Embraer-Empresa
    - Liquor companies Remy Cointreau and Pernod Ricard
    - Auto companies Porsche, Daimler Chrysler and BMW
    - Lodging companies Starwood and Mandarin Oriental
   
    The index could come in handy as the number of alluent households continues to grow.  According to the 2007 Spectrem Group Affluent Market Insights report, American ultra high net-worth households (meaning those with a net worth of $5 million or more, excluding principal residences) now exceeds 1.1 million – more than two times the number  in 2002.

Women generally buy clothing with an eye on style, but one place where function matters as much as fashion is on the golf course, according to a new study by research firm NPD Group.

The Port Washington, NY-based research firm said on Wednesday that men and women pointed to comfort as the primary quality they looked for in golf clothing and footwear, weighing significantly more on their purchase decisions than price or style.

“I think one of the biggest opportunities in the golf apparel market exists in women’s,” said NPD analyst Marshal Cohen, noting that 72 percent of women buy nonsports apparel to play sports, and that in golf, the number is even higher. “That means female consumers are buying a good deal of sportswear and activewear rather than golf-specific clothing. That is where I see opportunity.”

According to the NPD survey, 18 percent of U.S. men and 3 percent of U.S. women have played golf in the past year.

Internet sites that specialize in golf clothing for women include Lady Golf, The Ladies Pro Shop and Golf Sophisticate.

   With Sally Beauty Holdings Inc., there is a chance history might repeat itself.

First came Procter & Gamble – when it announced an expanded agreement with the beauty retailer’s Beauty Systems Group (BSG) earlier this year after pulling their Wella line of hair care products from BSG stores in 2004.

Now, Farouk Systems Group — known for its Biosilk line of products — may be making its way back from L’Oreal’s Beauty Alliance stores, and back into Sally’s BSG unit for distribution, according to a note by Bear Stearns analyst Justin Hott.

Previously, while announcing its second-quarter results on the heels of losing L’Oreal distribution rights, Sally said Farouk had terminated its distribution agreement with BSG. Farouk product sales in the first half of fiscal 2007 accounted for about 3 percent of BSG’s total revenue in that period, Sally said at that time.

Farouk may have turned to L’Oreal hoping for better execution, or perhaps a sale of the company. But L’Oreal recently added California-based hair care company PureOlogy to its portfolio — perhaps leaving Farouk an unlikely candidate for purchase, Hott wrote.

“This potential return could be a positive sign that the loss of top lines such as L’Oreal’s brands will stop weighing down SBH shares,” he said, adding it may make more sense for brands like Farouk to be at BSG.

Farouk’s possible return to Sally might not mean much to earnings right away, but it would reinforce the view that BSG could live without L’Oreal, Hott wrote.

It could also indicate that other brands could follow.

“We also have more confidence that other brands could follow,  such as the Paul Mitchell brand out West, which could add $0.02-$0.05 to annual EPS,” he wrote.

(Photo: from Sally Beauty Web site)

McDonald’s Corp.’s Chief Financial Officer Matthew Paull told analysts on Tuesday that he plans to leave the company after 14 years in order to go into teaching. The move will happen after McDonald’s finds his replacement.

In an interview with Reuters, Paull shared his thoughts about teaching and about the company.
 
“I do have what I would call an informal arrangement with a school out near San Diego… And it would be teaching international business and finance kinds of issues.” 

 On why he is leaving: 
“It’s important to me that people understand that I love this company and this job and people leave companies for all kinds of reasons, and for me it is all about, I’ve made enough money to be able to do what I’ve always wanted to do. And I taught for three or four years early in my career and I really loved it. But I couldn’t support the lifestyle I wanted on a teacher’s salary.”
 
On how teaching affected his McDonald’s career:
“It has helped a lot in what I do at McDonald’s … because very often when we’re describing a fairly sophisticated financial transaction to people who might not deal with it every day, it helps to know how to break it down to small, teachable pieces.” 
 
On whether he had ever wanted to be McDonald’s CEO:
“I believe strongly that this company needs to be run by somebody, who, if they’re not an operations person, at least thinks like an operating person. The company is about operating excellence and leadership marketing. I mean, you take somebody who thinks too much like a finance person and you put them in the CEO’s job, the company will never realize its promise.

“Some finance people, I’m not one of them, can make that transition from being somebody who thinks like a finance person to somebody who thinks like a brand/operating person. (Former McDonald’s CEO) Jim Cantalupo was a great example of a finance person who made the transition, but for the most part, this particular company should be led by somebody with an operations mindset.”

Shopper Alert: Retailer Macy’s Inc. is increasing coupons and promotions in the second half to spur store traffic.
    Goldman Sachs analyst Adrianne Shapira said in a research note that the effort, along with the launch of Martha Stewart-branded bedding and other home products, would likely help sales in the fourth quarter. But she cut her third- and fourth-quarter estimates for the operator of Macy’s and Bloomingdale’s stores.
    Macy’s spokesman Jim Sluzewski confirmed that the promotions were increasing. 
    “As initial tests of the strategy have proven successful across the Midwest and Northeast, we believe it could boost (same-store sales) into 4Q,”  wrote Shapira. 
    Earlier this month, Macy’s cut its second-quarter profit forecast, citing disappointing sales. The retailer, which had previously pared back coupons, is trying to lift results at former May stores it acquired in 2005 and converted to the Macy’s name last year.
    At a Goldman-sponsored lunch, management ”admitted it had enacted too much change too quickly,” Shapira said. She added that the company indicated it did not intend to permanently boost promotions.
    While the top brass didn’t directly address rumors about a potential buyout of the retailer, Chief Financial Officer Karen Hoguet did emphasize that the company “would entertain all options presented to maximize shareholder value,” Shapira noted.
    Stay tuned.

     It could be a good time to buy electronics and appliances. Vivian Ma, a CIBC World Markets analyst, notes that Census Bureau data indicate retailers of these items racked up sales growth of 1.4 percent in June, the weakest monthly sales growth in more than 2 years.
    ”If this trend continues, it bodes negatively for Best Buy and Circuit City,” Ma said in a research note.
The news wasn’t all bad. Ma added that the 42-inch LCD television was expected to be the most popular set this holiday season.
      Meanwhile, prices of LCD TVs are now comparable to those for plasma televisions, not the case compared with April 2006, when LCDs sold for more, she siad..
       Average selling prices for LCD Tvs in 32-,37- and 42-inch sizes fell an average of 38 percent in June, while plasma prices declined about 29 percent, she said. “We think the rate of decline could pick up again later in the year if competition turns out to be tougher than expected,” she added.
     With an outlook like that, who wants a sweater?

Anticipation of strong sales from Hollywood blockbusters “Transformers” and “Spider-Man 3″ helped Hasbro’s shares surge nearly 75 percent in the last year, but the question of what’s next has  caused some investors to pull back.

The stock fell as much as 5 percent on Monday despite Hasbro posting a better-than-expected quarterly profit on higher sales, which were boosted by strong demand for its Transformers and Spider-Man 3 toys.

“My sense is that people are looking at the strength this year as a good thing, but are concerned that Hasbro is going to be challenged to drive growth next year,” Arcadia Investment Corp. analyst John Taylor told Reuters.  “The challenge with an entertainment business is that it probably has to be replaced next year. They’re not long-lived revenues,” he added.

Webush Morgan Securities analyst Sean McGowan sounded a similar theme. In a research note, he wrote that “investors considering the prospect of a negative earnings comparison in early 2008 may bid the stock down.”

Looking ahead, Hasbro will seek to drive growth over the second half of the year with new toy lines including board game version of the Fox TV show “Are you smarter than a 5th grader?,” a Littlest Pet Shop game, talking parrot Squawkers McCaw, the Power Tour Guitar and Peyton Manning Football.

     Where are U.S. consumers seeing prices rise the most?  How about at the local grocer?
    Grocery store prices are up at an 8 percent annual rate this year, the fastest pace since March 1990, David Rosenberg, North American Economist for Merrill Lynch said, citing the June consumer price index report.
  Grocers have been under pressure to keep prices in check for years amid fierce competition from Wal-Mart Stores, the retailing behemoth that made its bones with everyday low pricing and has become the largest U.S. grocery retailer.
    But in recent quarters, food manufacturers have been able to push higher prices through grocers to help make up for rising costs for everything from corn to milk to fuel, putting grocery stores atop the sectors showing the most pricing power.
    Among other retail and food sectors noted by Rosenberg, jewelry store prices are up 6 percent, and restaurants were up 3.5 percent.
    On the downside, clothing prices have declined four months in a row, and are down 1.4 percent year on year, the worst deflation in 16 months. Women’s clothing prices are falling faster than men’s.
    Toy store pricing, meanwhile, is down eight months in a row and the year-on-year pace is down 4.3 percent, he said.
    For the equity market, “this is key since determining which sectors to be in and out of hinges, at least in part, on whether or not firms are able to raise prices and to make them stick,” Rosenberg said.
    Rising food and energy costs have been the primary culprits behind stubbornly high U.S. inflation in recent months. The interest rate-setting Federal Reserve has said that inflation remains its primary concern — trumping even the slowing housing market.

What’s the matter with kids today?

 Well, for apparel retailers, they’re spending too much on electronic gadgets, which, coupled with higher gas and grocery prices, could hurt sales in the upcoming back-to-school season.

Almost half of American parents say they will keep back-to-school apparel spending to a minimum this fall, according to a survey by America’s Research Group.

American Eagle is trying to attract customers with  the chance to win a free pair of jeans. Wet Seal also has a contest going on where the winner wins a trip to Los Angeles, a shopping spree and concert tickets.

Meanwhile, Wal-Mart will go into the back-to-school season with new people in charge of apparel merchandising. The retailer announced Friday that Claire Watts left that job to “pursue other career interests”.