No. of Recommendations: 2
I think the much bigger risk factor for the chocolate industry is the supply chain. Most cacao is grown by extremely poor smallholders. That will change, and the supply chain with it. I imagine prices will rise a lot, and artificial flavours have got pretty much nowhere despite decades of effort.
I am more concerned about the general trend towards "off brand" consumption in the food business. I see more and more store brands combined with highly local products; less the traditional products that we used to get. Amazon/WF has been very successful in this approach as has Costco and I see the trend accelerating in the future. Likely not an immediate existential threat to Hersey, but a head-wind for sure.
I hope that the lessons learnt on Kraft/Heinz are not forgotten...
tecmo
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