10/11/2016

The Sweet Side of the Supply Chain

Reading Time: 2 minutes
candy corn on counter

The Hershey Company, a worldwide leader in the candy and sweets market, has grown from the simple chocolate bar producer to an international manufacturer with more than 80 brand products, distributing to 70 countries1. As the company saw an increase in brands, Hershey developed a streamlined global supply chain system, utilizing technology and visibility, resulting in higher sales volumes and improved operations2. As a company grows, a supply chain partner is key to keeping shelves stocked and meeting consumer demand.

This Halloween season, consumers will spend $2.5 billion on candy, averaging $82.93 per person on the sweets and treats the holiday has to offer3. As children and adults alike indulge on these candies and chocolates, the process of ensuring a smooth confectionery supply chain is important in continuing customer brand loyalty.

Keeping Up With the Surge

According to the National Retail Federation, 44.4% of candy purchases this Halloween season will take place in the first two weeks of October and 29% in September3. Confectionery producers must be prepared for the demand surge of candy during those peak months. Utilizing a 3PL with warehousing gain sharing opportunities can help mitigate warehousing costs during low volume periods while providing the space needed during high demand times. Technology, such as a warehouse management system, can provide needed visibility to track product movement to ensure stocked shelves during a crucial time.

Controlling Temperatures

There’s nothing worse than opening a chocolate bar to find it has melted. Temperature controlled storage and transportation is important for confectionery products that require certain conditions. Most chocolate should remain between 50 and 65 degrees4. An end-to-end supply chain solutions provider can provide integrated service across transportation, warehousing, and global logistics operations to retain product integrity. Technology advancements like those in refrigerated intermodal containers continue to improve, providing an additional transportation option that enables shippers to monitor and even remotely adjust the temperature of the containers their products are in.

Ensuring Regulation Compliance

Understanding upcoming regulations and partnering with a 3PL that can manage these requirements allows for a compliant and smooth supply chain. Consumable products are under increased guidelines compared to other transported items. This year, the Food Safety Modernization Act (FSMA) went into effect, requiring extensive shipper and transporter documentation, training, and temperature control requirements when transporting food products for consumption by humans and pets. These controls have been put in place by the Food and Drug Administration (FDA) to take a more proactive approach in preventing food borne illnesses.

Partnering with a 3PL to deliver this Halloween season can keep candy in the hands of trick-or-treaters and loyal customers anxiously anticipating seasonal treats. A supply chain solutions provider can implement seamlessly engineered solutions that fit a company’s unique business needs and manage the many components of an important process. The right partner can manage regulations, temperature controlled needs, and anticipate the demand surge, ensuring customers are enjoying the sweet holiday treats.

Sources

  1. https://www.thehersheycompany.com/en_us/this-is-hershey.html
  2. http://marketrealist.com/2015/10/hershey-gained-improving-supply-chain/
  3. https://nrf.com/media/press-releases/halloween-spending-reach-84-billion-highest-survey-history
  4. http://trade.gov/topmarkets/pdf/Cold_Chain_Top_Markets_Report.pdf