The Hershey Company,a Pennsylvania-based manufacturer of chocolate and sugar confectionery products,is planning to set up a new facility in Asia and focus on its five core brands-Hershey's,Reese's,Hershey's Kisses,Jolly Rancher and Ice Breakers.
The company claimed that its future growth would be achieved from the US and emerging markets such as China,Mexico,and Brazil.The details of the location of the new facility are yet to be confirmed,reported Confectionerynews.com.
Hershey's business in China has been growing substantially with an 88%compound annual growth rate(CAGR),compared to other markets since 2007.It plans to launch Hershey brand,Ice Breakers and Jolly Rancher brands in China.
The company set up a R&D center in Shanghai to develop products for the Chinese and Asia-Pacific markets.It held a JV with Korean confectioner Lotte to manufacture in Shanghai,revamped the packaging of Hershey's Kisses for the Chinese market,which led to a 7%increase in product sales.
Besides,Mexico and Brazil were identified as the company's two other focus markets for growth outside the US and Canada.The company recorded 8%and 16%CAGR in Mexico and Brazil respectively.Further,it plans to introduce the Reese's brand in Mexico and Ice Breakers brand in Brazil.
Hershey chief executive officer John P Bilbrey said that Cadbury brand has been well positioned in the Indian market,and entry into the chocolate segment in India is quite tough.
Currently,Hershey international business accounts for 30%of its revenues.However,the company plans a 50-50 balance between international markets and the US&Canada by 2017.
Hershey expects its net sales for fiscal 2012 to increase by 7-9%.The company reported$6.1bn revenue in 2011.
