January 1, 2006
Basics are the best way to 'bulk up' — but above all, keep the section clean and pristine.
Bulk Candy Estimated U.S. Retail Market Size
$1.5 - $2.0 billion
Source: Confectioner estimate based on input from industry players
When thinking about bulk candy, think “B” for basics. Well known varieties of candy are really the backbone of the business; it seems the better the selection of basics, the more bulk candy sells.
Because health concerns are always an issue, many leading players are providing a complete selection of best-selling candies — wrapped.
It has been reported that bulk candy sells about 30 percent better in supermarkets if placed in the produce department. In stores of about 45,000 square feet or more and/or stores achieving annual sales of $30 million or more, placing a secondary fixture has been shown to work well. A secondary display in or around the dairy department is one such example. Cross-promotion opportunities, especially for higher-end bulk candy, also exist in and near video, CD, book and magazine departments. Floor or power displays near snacks and chips have also worked well for the category.
Bulk candy is not known for its “super seasonality,” however, it can be positioned as a great way for consumers to fill up Easter baskets and other home-made holiday gifts. But perhaps the best seasonal opportunity the bulk candy fixtures deliver is this: they can be utilized as a merchandiser of the unsold contents of packaged seasonal candy — which can later be placed in the bulk bins and sold for full price.
The bulk candy business has not come close to its full potential say our sources; one player estimates that the ideal market would include all supermarkets with 25,000 square feet or more of space, which also achieve an annual volume of $10 million or more per store — certainly not all a part of the bulk scene today. Nevertheless, the category is enjoying double-digit growth of late. This is expected to continue. n
Go big on the basics. Right now, gummy bears, worms, peach rings and sour worms have all joined the ranks of the tried and true — such as Tootsie Rolls, milk caramels and the like. Expectations for the peanut brittle category are also rising. While it is good to look for new products to keep the category current and fresh, it is more important to maintain a wide variety of basic, recognizable candies.
Clean it up. Candy buyers need to trust their bulk candy vendors to make suggestions and help manage the category, especially when it comes to issues of health and sanitation. Many are recommending moving to all-wrapped candies. But even without that strategy, retailers need to maintain the most pristine bulk appearance — always.