The wholesale candy industry has gone through so many changes in the last 50 years it is incredible. The industry has evolved from many small players in the early 1960's and 1970's to a much smaller set of mid sized to huge wholesale candy suppliers. Manufactures are also much stricter with the criteria needed to buy direct. The industry consolidation has also required the wholesale candy supplier to carry a broad product base. This is required as customers are looking for one stop shopping. Many wholesale candy companies are being bought by the larger ones, are forced out of business or if lucky can find a niche area to play in.
Adding to the industry pressures are wholesale candy price increases. While candy prices have continued to increase over the last few years in 2007 and 2008, customers are often very price conscious and demanding. Recently written in Professional Candy Buyer magazine is an article citing how Hershey and Mars announced that due to the rising cost of milk and cocoa it is raising its prices again. This is the second time in a year now. This increase is said to raise wholesale prices about 12% and 11% respectively. This is on top of a 5% increase in April 2008. For Hershey the increase will take effect immediately and Mars the increases will be introduced through March 2009. Energy and commodity prices are said to be the cause of the increases. The increase in costs has gotten to such a point that there are even discussions on modifying the standards to lower cocoa butter contents to save costs.
Currently the existing federal standard for chocolate says that chocolate in its purest state must contain between 50% and 60% cocoa butter. The proposal includes using a vegetable fat to supplement the product at a lower cost. A relatively new avenue for wholesale candy suppliers is to use the internet as a means for attracting new customers. Online wholesale candy sales do have high barriers of entry. The complex and technical demands of establishing an online presence and the associated required knowledge is often not in the skill set of the candy wholesaler. This then requires additional funds to invest in technology and on line marketing. However, if the barriers of entry can be over come, online sales offer the opportunity for the small candy wholesaler to have a large look and presence. While website design and maintenance will cost money it is schoko adventskalender possible that revenues can increase to defer the costs. In addition the costs of hiring a sales force can also be reduced.
Adding to the industry pressures are wholesale candy price increases. While candy prices have continued to increase over the last few years in 2007 and 2008, customers are often very price conscious and demanding. Recently written in Professional Candy Buyer magazine is an article citing how Hershey and Mars announced that due to the rising cost of milk and cocoa it is raising its prices again. This is the second time in a year now. This increase is said to raise wholesale prices about 12% and 11% respectively. This is on top of a 5% increase in April 2008. For Hershey the increase will take effect immediately and Mars the increases will be introduced through March 2009. Energy and commodity prices are said to be the cause of the increases. The increase in costs has gotten to such a point that there are even discussions on modifying the standards to lower cocoa butter contents to save costs.
Currently the existing federal standard for chocolate says that chocolate in its purest state must contain between 50% and 60% cocoa butter. The proposal includes using a vegetable fat to supplement the product at a lower cost. A relatively new avenue for wholesale candy suppliers is to use the internet as a means for attracting new customers. Online wholesale candy sales do have high barriers of entry. The complex and technical demands of establishing an online presence and the associated required knowledge is often not in the skill set of the candy wholesaler. This then requires additional funds to invest in technology and on line marketing. However, if the barriers of entry can be over come, online sales offer the opportunity for the small candy wholesaler to have a large look and presence. While website design and maintenance will cost money it is schoko adventskalender possible that revenues can increase to defer the costs. In addition the costs of hiring a sales force can also be reduced.
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