Terry White chemists are withdrawing all golliwog stock after a Queensland customer spotted the toys unfortunately placed beneath a sign that read, "Experience a White Christmas."
The chemist chain has said the "Golly Doll is not part of our national line of endorsed products" and it was taking "immediate action" to pull all stock from its sale nationwide.
The alarm about the dolls was raised when Toowoomba man George Helon spotted the dolls unfortunately placed beneath the sign.
The anachronistic dolls alone are racist, but when customer George Helon saw them on show below the "White Christmas" sign in the Clifford Garden shopping centre store he was left in a state of “shock and awe”.
“In Toowoomba this episode has reignited some tensions that have been bubbling below the surface,” he told Yahoo7.
“What a faux pas! Should cause quite stir,” he said.
While shocked, the Toowoomba local acknowledged that the display was clearly not malicious on the chemist’s behalf.
He added people “have to see the funny side”.
Despite Mr Helon's take on the matter, the store's managing partner Alwyn Baumann apologised for stocking the item, telling Yahoo7 the dolls had been withdrawn and returned to the supplier.
"We unreservedly apologise if we have caused offence to our customers or any member of our local or broader community for selling this product," Mr Baumann said.
"We have made a regrettable error in choosing to stock this product."
TerryWhite Chemmart went further to say that, while franchisees were free to sell stock of their own accord, it would tighten its guidelines for it regarded as appropriate for sale.
"We have taken immediate action to audit all pharmacies within our network to ensure this product, if present in any other pharmacy, is withdrawn from sale," the chemist chain told Yahoo7 in a statement.
"Pharmacy owners within our network can stock and sell products at their discretion, in addition to our national line of endorsed products.
"As a consequence, we will tighten our guidelines to ensure pharmacies within our network order and stock appropriate products consistent with our business values."
It’s not the first time the old-fashioned plush toys have been in the spotlight in recent weeks.
Earlier this month a retro Victorian lolly shop with a toy golliwog on its logo had to withdraw a television commercial after the advertising watchdog ruled it "humiliates and ridicules".
The advertisement featured an animated version of the logo with the golliwog alongside other stuffed toys standing with old-fashioned confectionery.
The golliwog was a part of the Beechworth Sweet Co logo since 1992 and is not racist, the shop's previous owner Judi Borschman said.
"It's done out of pure love for gollis," she told 3AW at the time.