Hershey’s Chocolate Dips into Foreign Markets

26 Nov 2007|Added Value

Cheskin Strategic Director, Cynthia Chan comments on Hershey’s strategy in China in this recent Brandchannel.com article by Randall Frost.  — In February 2007, Hershey Foods announced a three-year restructuring plan aimed at building sales overseas. The plan called for closing many of the company’s plants in the US and Canada and for the elimination of 1500 jobs. To make up for lost production, a new plant would be built in Monterrey, Mexico.

John H. Boyd, the founder of the Boyd Company of Princeton, NJ, has analyzed the costs of operating a Hershey factory at various locations in North America. Says Boyd, “The Mexican facility is slated to account for 10% of Hershey’s productioin by 2010. Lower sugar and labor costs will result in significant savings for the company. The Monterrey plant is their initial close-in, safe alternative to broadening the international footprint. But the production coming out of Monterrey will be shipped to North America.”

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