Candy Manufacturers

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 1,650 candy manufacturers in the US combine chocolate, sugar, and other raw ingredients to produce confections and chocolate-based products. Products consist primarily of chocolate and non-chocolate candies. Chocolate candies include bars, baking chocolate, coatings, syrups, liquors, powdered cocoa, fudge, and covered nuts. Non-chocolate candies include gum, chewy candy, hard candy, jelly candy, licorice, marshmallows, and toffee.

Variability in Raw Ingredient Costs

The cost of raw ingredients used in candy manufacturing can vary significantly from year to year, according to trends in commodity prices.

Seasonal Sales

Demand for candy is seasonal, and peaks during key holiday periods.

Industry size & Structure

A typical candy manufacturer operates out of a single location, employs 43 workers, and generates about $17-18 million annually.

    • The candy manufacturing industry consists of about 1,650 companies that employ 64,360 workers and generate $28.5 billion annually.
    • Chocolate confectionary manufacturing accounts for 63% of industry sales.
    • The candy manufacturing industry is concentrated - the top four chocolate confectionary manufacturing firms are about 58% of category sales. While non-chocolate confectionary manufacturing is less concentrated, large firms still dominate - the top 20 companies are 76% of category sales.
    • Large companies include Mars Wrigley, Hershey, Nestle, and Tootsie Roll Industries.
                                  Industry Forecast
                                  Candy Manufacturers Industry Growth
                                  Source: Vertical IQ and Inforum

                                  Recent Developments

                                  Apr 30, 2023 - Sugar Prices Soar
                                  • The price of sugar soared to its highest level since 2012, driven by disappointing harvests in some of the world’s largest producers and strong demand in China, The Wall Street Journal reports. The steep rise in the price of sugar could lead to higher prices for sweets and sugary drinks, according to WSJ. Raw cane-sugar futures traded above 24 cents a pound in recent sessions, reaching the highest since March 2012. Bad weather in India, China and Thailand has led to declining sugar production in all three countries, just as China’s economy has begun to reopen following the end of coronavirus lockdowns. Candy manufacturers will have to decide whether to pass on their higher costs to consumers or take a hit to profit margins. Also, white-sugar futures are up 20% this year through mid-April, peaking recently at their highest since October 2011, WSJ reports.
                                  • Sales of chocolate and candy reached $42.6 billion last year and are expected to exceed $54 billion by 2027, according to the National Confectioners’ Association’s 2023 State of Treating report. Overall confectionery category dollar sales grew 11.1% over 2021 and 22.1% over 2019, according to the report. By category, 2022 dollar sales of chocolate rose 9.1%, while dollar sales of non-chocolate and gum and mints both increased 13.8%. The strong sales numbers and positive consumer data demonstrate that confectionery’s affordability sets it apart during a time of uncertainty. The 2023 report also reinforced the direct correlation between enjoying chocolate and candy and emotional well-being. The data shows that 78% of consumers agree chocolate and candy help make them happy, and 79% agree positive emotions and physical health are interconnected.
                                  • A bill introduced in the California legislature in February would ban the manufacture, sale or distribution of food products, including candy, containing certain ingredients beginning in 2025, the National Confectioners Association (NCA) reported in March. The NCA, which strongly opposes the bill (AB 418), said the legislation would ban food products that contain brominated vegetable oil, potassium bromate, propylparaben, Red dye 3, and titanium dioxide. In a letter to the bill’s sponsor the NCA wrote “We strongly oppose AB 418 because there is no evidence to support banning the ingredients listed in the bill,” adding that the ingredients to be banned under the bill have all been approved by the US Food and Drug Administration. Last year, Skittles maker Mars Wrigley was sued over titanium dioxide, a legal food additive.
                                  • Convenience stores anticipate continued strong candy sales this year, despite rising prices, CStore Decisions reports. Overall, dollar sales of chocolate and non-chocolate candy are up, although unit sales have fallen as prices increased over the past year. According to NielsenIQ data, dollar sales for the overall candy category came to $31.4 billion, up 11.8% for the 52 weeks ending Nov. 26, 2022, across food/grocery, drug, mass merchandisers and convenience channels. Chocolate led the category with $17.81 billion in sales (+10%). However, candy unit sales overall totaled 12.4 billion — a 0.3% decline compared to the previous year, with 2.5% decrease in chocolate unit sales. Prices for candy are on the rise. The average unit price for chocolate was $2.82, a 12.8% increase, with $2.53 being the average unit price for candy overall, representing a 12.2% climb.
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