NEW YORK (MainStreet)—Think you’re supporting a small business when you make the more “natural” or “organic” choice at the supermarket? Think again. Many of the sustainable brands at your local grocery store have broken into the mainstream thanks to their partnerships with big corporations — you know, the ones making that chemical-laden option on the next shelf.
For small brands like Honest Tea, Burt’s Bees, Kashi, Tom’s of Maine and Silk, getting enveloped into a larger corporation is usually the key to scaling out their business. Often, it’s a win-win situation. The small brand gains access to the corporation’s resources and distribution network. In return, the corporation learns lessons on how to operate as a mission-driven business.
But in other cases, corporate ownership taints the values of the organization. Take Silk, a soy milk company owned by multi-billion-dollar dairy conglomerate Dean Foods. In 2009, Silk quietly switched its organic soy milk formula to one utilizing conventional soybeans, with nary a notification to customers, save for a removal of the “certified organic” logo from its packaging. Then there’s Tom’s of Maine, which has slowly but surely reformulated its natural toothpastes and deodorants to include ingredients like aluminum and titanium dioxide.
1. Honest Tea
The Coca-Cola Company, which also owns Coca-Cola, Sprite, Minute Maid, Powerade, Vitamin Water, Odwalla, and Fuze
After lamenting the lack of flavorful, low-sugar beverages during a business school case study on Coke and Pepsi, Seth Goldman and his Yale School of Management professor Barry Nalebuff decided to create Honest Tea, a line of healthy and organic beverages. Ironically, it was The Coca-Cola Company that jumped on board to bring Honest Tea to the next level when it purchased 40% of the company’s shares in 2008. In 2011, Coca-Cola bought up the remaining shares, and Honest Tea is now a wholly-owned but independently-operated subsidiary.