Hersheys Chocolate

Chocolate was previously considered a “delectable symbol of luxury, wealth, and power” (Klein) in the 1500s. Using modern technology, it is now easily produced. While

The premium chocolate industry is a large market in the United States and continues to grow around 10% annually. It is also populated with very strong

Clare’s Chocolate Cafes has always used good quality cocoa to make their chocolate products. This is, in itself, an amazing marketing product because customers know that while they may be paying a little bit more, the product is worth it. As well, the organization makes a wise customer draw when each hot beverage is served with a high quality chocolate product. The early practice of making chocolate products by hand and providing individual or pre-packaged products, of all sizes, for the customer to select, was

Hershey’s and Cadburys are moving towards the premium chocolate market through the acquisition or upmarket launches (Zietsma, 2007). The profit potential present in this sector supported by its 20% annual growth rate make it very attractive for large organizations to come forward and avail this opportunity. There is a low threat of new entrants prevailing in this chocolate industry because of the high capital requirements and expected retaliation by current manufacturers. Current players in the industry also possess some barriers to entry for new entrants by maintaining economies of scales with their large production capacity and keeping their product differentiation with their specialized and novelty chocolate products. Even though there are low switching costs and easy access to distribution channels, but still the brand loyalty of the customers including the Rogers’ Chocolate itself make it harder for new firms to come into the competition.

The Lancaster Caramel Company was so successful, Hershey built off of it to create the Hershey Chocolate Company.

Hershey started with 500 acres of land to build the company; within one year of being open he expanded to 12,000 acres (Career). He made the company bigger and better as time went on. When Hershey first opened, milk chocolate was the only candy produced. Around 400,000 quarts of milk were used each day to manufacture chocolate, around half a million pounds of chocolate was produced a day. While planning the rest of the Hershey factory, Milton wanted his employees to have a safe, home-like environment to live in. Workers would need comfortable homes, medical care, recreational facilities, and school for their children. Not only would Hershey help them out financially, he would help them with personal issues too. The production took around a year to do. By then Hershey Company was ready to open and produce candy

The founder of Hershey Chocolate, Milton Hershey, had a long journey to creating some of the most famous candy today. From a young age he lived in poverty and his parents constantly fought due to differences, which would always have an impact on Milton’s life. He started out in the business struggling, first with his caramel business going under and the unhelpful advice of his father that only led to Milton making more mistakes. Once Milton made it big he went on to do amazing things and dedicated a big part of his life to helping other people and focusing on the well-being of his employees. Milton Hershey was indeed one of the most famous and successful people in the candy community, but it was only through many hardships and stress that got him there.

The chocolate industry operates in an oligopoly market. An oligopoly is when a small number of firms dominate the market. While not a quite a monopoly, an oligopoly market is still controlled by a select number of companies and the market can be directly impacted by one or two major firms (Oligopoly Investopedia). Hershey’s has control of the largest market share, holding 44.4% (U.S Market Share). Mars Incorporated follows behind in second by holding 28.9%. While these two companies hold much of the control and power within the industry, LIndt/Ghirardelli and Nestlé maintain a combined share of 15.1% of the industry’s market. This means that four companies hold a combined 88.4% of the market, with two of them holding a combined 73.3%. The market was not always this way however. Up through the 1960s many candy suppliers were regional.

The premium chocolate industry is having an intensive competition in Canada with the strong growth potential. Industry growth opportunity imposes increasing competition from rivals and threats of new entrance that adds pressure on overall profitability. Even though Roger’s has been able to establish its place in the chocolate industry with its strong brand recognition and products’ quality, it still needs to be on top of ever- going market changes, by continuously

For over one hundred years, there has been only one company that has been on top of the candy industry in North America; Hershey. With over 14,000 employees, serving 70 countries worldwide and net sales of $6.6 billon, Hershey has come out on top. The Hershey company began in 1894 by Milton Hershey. The company has over 8 factories, but their main headquarters resides in Pennsylvania. The beloved Hershey milk chocolate bar has been a favorite by many, but would it still be if more people knew how it came to be that? One of chocolates main ingredients is cocoa. Cocoa, or cocoa beans come from tropical areas around the world, but is mostly found on the Ivory Coast in West Africa. Hershey, along with Mars and Nestle are the three major companies that buy their cocoa from West Africa, but with further investigation, it has been known that over 4,400 children work on those cocoa farms that they buy from.

The premium chocolate market has been growing at 20% annually, showing that buyers are willing to pay more for a better tasting and better quality chocolate. The declining growth of the overall chocolate market and rapid growth of the premium chocolate market is positive for current producers of premium chocolates in that the decline

The proposed sale of Hershey Foods Corporation (HFC) during the summer of 2002 captured headlines and imaginations. After all, Hershey was an American icon, and when the company’s largest shareholder, the Hershey Trust Company (HSY), asked HFC management to explore a sale, the story drew national and international attention. The company’s unusual governance structure put the Hershey Trust’s board in the difficult position of making both an economic and a governance decision. On the one hand, the board faced a challenging economic decision that centered on determining whether the solicited bids provided a fair premium for HFC

Born into a poor, lower-class family, Milton S. Hershey dropped out of school before reaching the fourth grade. He developed an interest in becoming a confectioner. He believed there would be great demand for affordable, mass-produced chocolate, and thus he built the Hershey Chocolate Company. Hershey’s is now the largest producer of quality chocolates in North America and a global leader in chocolate and sugar confectionery. Although he enjoyed making money, Milton S. Hershey was intent on using his vast fortune for philanthropic purposes. He decided to surround his enterprise with a model town and personally financed the building of roads, utilities,

The community members did not agree with the trust board decision to sell 33% of Hershey shares to other investors. Milton Hershey did a lot to his community as a result the community felt like they have high stake in Hershey Company. Hershey himself had a sign in his office saying “Business is a matter of human services”. After his death the board rearranged the company from operating at loss while maximizing community needs to operate at profit to maximize shareholders wealth.

Hershey chocolate is known as one of the world’s most popular chocolate brands. For 118 years, the Hershey brand remains a favorite chocolate treat in over 90 different countries. Beginning only manufacturing milk chocolate, the company today manufacturers over 100 different varieties of candy. Many people are familiar with the traditional Hershey milk chocolate bar, Reese’s peanut butter cups, and bite sized Hershey kisses. The process behind producing these famed treats is a fascinating process. By evaluating the company’s manufacturing process and business dynamics, consumers can gain a better perspective of the science behind the candy the enjoy most.