In between ongoing updates about Kraft Foods’ bid to swallow up Cadbury PLC, I perused our Global Top 100 listing gleaned by our annual contributor, Paul Rogers. Last year, as he notes, was “remarkably quiet” on the mergers and acquisitions’ front.
Considering that most companies were focused on simply threading water until the recessionary tsunami retreats, it’s really not surprising.
But Rogers surmises that 2010 could unleash pent-up plans for many a candy company, the Kraft/Hershey/Ferrero/Nestle/Cadbury deal – however it turns out – obviously being the blockbuster that sets the tone.
So that got me to thinking; what is it about confectionery that wets the whistle of so many high-powered movers and shakers as well as emerging entrepreneurs?
Aside from the intrinsic “feel good” value of telling someone that you work for a confectionery company – most non-industry types immediately light up, probably hoping they can score a sweet connection – there are quite a few elements that make this segment positively attractive.
One that strikes me immediately is its stratification, an industry that within three primary segments - chocolate, non-chocolate and gum - contains a slew of subsegments and niches that allows large and small companies to operate side-by-side.
Okay, some family-run, full-line midsized candy companies might dispute that argument, noting it’s extremely difficult competing against the big boys within a mainstream market.
Undeniably. There are many, classic companies that for a variety of reasons have either been swallowed up by larger competitors or simply struggled mightily, but to no avail, succumbing to bankruptcy.
That said, it appears to me that there’s enough mobility within the confectionery, in part due to its global presence and universal appeal, for those fleet of foot to weather out such perfect storms of near total financial collapse.
Confectionery’s universal appeal, which continues to evolve and expand, dovetails with its underlying foundation of technological development. Going back to Egyptian and Aztec periods, its primary ingredients somehow lend themselves to processing improvements.
Yes, there’s that love of truly hand-crafted artisan confections. At the same time, it’s truly exciting to see automation replicate those same confections expertly, efficiently and economically.
One last point about the attraction of confectionery companies; it’s the sourcing. From sugar to cocoa, from corn syrup to fruits and nuts, the myriad ingredients used to concoct a sweet treat truly underscore a wide-ranging and at times exotic, agrian connection.
Am I romanticizing the appeal of confectionery companies a bit? Certainly. But having ushered out 2009 with a sigh of relief, I believe we all could use a bit of rose-colored appreciation for this industry’s resiliency.