Working the PEZ Plan
Upgrades in manufacturing and warehousing support PEZ Candy’s incredible growth in the confectionery novelty segment.
It’s been an ongoing argument. Is PEZ Candy, Inc. a candy company or a toy company? The fruit-flavored sugar tablets certainly qualify as candy, while the reliable dispensers featuring nearly 300 different characters and icons have made it an interactive novelty in the United States since 1953.
But given the company’s success in rotating between 10 and 12 assortments on a yearly basis - not counting seasonal as well as “favorites” rotations - the company certainly could be classified as a logistics wizard.
Such new product manipulation has helped propel sales. Recent IRI (Information Resources, Inc.) data for novelty non-chocolate and seasonal sales for the 52 weeks ending Dec. 27, 2009, detail a 9% growth spurt, nearly triple the category’s 3.6% climb during the same period.
This year, the company will unveil the Snow White and the Seven Dwarfs Collector Set, which will feature all seven dwarfs on shorter PEZ bases with their names printed on the dispenser pad. The collector set also will include a small book that describes the classic tale. Although the Snow White dispenser will be available individually as part of the Disney Princesses series, the dwarfs will only be sold within the collector set.
A Thomas and Friends Gift Tin also will be rolled out in the fourth quarter, and will feature Thomas as well as two new exclusive Friends dispensers. The gift tin actually does double duty as a lunch box, a strategic move that underscores the company’s strategy of reaching out to a broad consumer base.
The $2-million investment dovetailed with another million dollars spent on equipment purchases, ventilation upgrades, expanded inline coding and a new heating system. The final phase of the improvements continues today with the completion of a quality control laboratory.
The first critical link in the supply chain begins with production. After delivery, powdered sugar is compacted into granular sugar before being pumped into a Glatt mixer. During the 50-minute mix cycle, corn syrup, water, flavor, vegetable oil and color are added to the 600-lb. batch.
PEZ's management team (from l. to r.): Mark Morrissey, coo; Bryan Fry, cfo; Joe Vittoria, president and ceo; Keith Whitaker, v.p. - marketing and sales administration.
“It’s worked great for us,” Vittoria says.
Just this past year, the company also revamped the packaging on its candy bags, introducing bolder, more dynamic graphics and colors. Sales of candies have grown during the past few years, and the redesign was launched to take advantage of the heightened interest by consumers seeking values.
At a Glance
PEZ Candy, Inc.