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 1,670 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.
Seasonality
Demand for candy peaks during key holiday periods, with nearly two-thirds (64%) of total confectionary sales occurring during four holidays.
Industry size & Structure
A typical candy manufacturer operates out of a single location, employs 49 workers, and generates about $22 million annually.
- The candy manufacturing industry comprises about 1,670 companies that employ 81,300 workers and generate $36.8 billion annually.
- Chocolate confectionery manufacturing accounts for 53% of industry sales.
- The candy manufacturing industry is concentrated - the top four chocolate confectionary manufacturing firms are about 53% 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
Recent Developments
May 30, 2024 - Producers Hike Prices As Cocoa Costs Soar
- Producer prices for chocolate and confectionery manufacturing shot up 15.5% in March compared to a year ago after rising 9.2% in the previous annual comparison, according to the latest US Bureau of Labor Statistics data. Producers are hiking prices to cover the soaring cost of cocoa following a production shortfall in West Africa and rampant financial speculation in the market for cocoa. Companies that use more pure cocoa — rather than palm oil and other fillers that go into many candy bars — are most exposed to soaring cocoa prices. Employment by candy manufacturers shrank 4.1% in March compared to a year ago and fell 8.2% from its annual peak in December, BLS data show.
- Illinois is one of several US states looking to ban certain food additives found in many popular candies, the National Confectioners Association (NCA) reports. Since California passed legislation last fall to ban four chemicals – brominated vegetable oil (BVO), potassium bromate, propylparaben, and red dye No. 3 – effective in 2027, other states, including New York and Pennsylvania, are considering similar legislation. In April, the Illinois Senate passed the Illinois Food Safety Act (SB 2637) that would ban the four chemicals. “This measure sets a precedent for consumer health and safety to encourage food manufacturers to update their recipes to use safer alternatives,” said the bill’s sponsor, Sen. Willie Preston (D-Chicago). The NCA noted that other states – Indiana, Maryland, South Dakota, Washington, and West Virginia – have rejected similar bills because the proposals lack scientific basis. The chemicals are banned in Europe.
- A trip to the candy store is getting more expensive, driven by increases in the price of sugar, cocoa, and other inputs. Candy and nuts manufacturers and makers of chocolate and confectionery products each hiked prices last year, and retail candy prices continue to climb in 2024. Prices paid by consumers for candy and chewing gum were 5.8% higher in February than a year ago, outpacing broader inflation, which was 3.2% in February, according to the US Bureau of Labor Statistics.
- The US is the world’s largest market for candy consumption, followed by China and the UK, according to Gitnux market data. Revenue in the confectionery segment in the US is expected to grow by 3.18% and reach a peak by 2026, Gitnux reports. US consumption of chocolate and other candy is expected to grow from about $268.1 million in 2020 to $275 million this year. Consumers between the ages of 25 to 45 account for the majority of confectionery consumption, while shoppers older than 34 purchase more candy than those between the ages of 18 and 34. Overall, US consumers spend approximately $9.1 billion annually on candy, with the average American consuming 25 pounds of candy per year, according to Gitnux data.
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