I’m sure our readers have seen the latest headlines: Ferrero to acquire Fannie May Brands; Haribo USA to build production facility in Pleasant Prairie, Wis.
Not that this represents anything new — large and small acquisitions within the global confectionery industry have been generating news for us at the magazine for the past 16 years (my tenure at Candy Industry, by the way) and before.
What I find most interesting about these latest deals, however, is that this marks the first time these two companies will be producing confections on U.S. soil, particularly since both are giants that have production facilities scattered throughout the world. For example, Ferrero operates 22 plants while Haribo tallies 16.
You would think they would have landed in the United States earlier than 2017. OK, granted, Fererro opened a state-of-the-art facility in Brantford, Ontario, Canada in 2006, and then expanded it last year. And yeah, it also has a plant in Mexico, which opened in 2012. Both provide easy access to the United States.
But there’s something more than just symbolism about making a decision to actually operate a facility in the United States. Granted, Ferrero’s initial focus will be on turning out Fannie May and Harry London products from the 250,000-sq.-ft. North Canton, Ohio, facility that’s part of the deal.
But you know Ferrero will not only be doing some R&D there regarding new products for its Fannie May and Harry London brands, but I strongly believe it will begin to explore the possibility of producing some of its own iconic brands at the plant.
Now, I’ve had the opportunity to visit Ferrero’s facility in Alba, Italy, and actually saw them turning out those wonderful Ferrero Rocher treats in volume. Quite a sight! It’s a complicated candy product requiring technology and automation, but I’m sure Ferrero can replicate that process — or any other item in its portfolio, for that matter — anywhere it wants to. Besides, now the time is ripe to capture those Millennials with mainstream premium products.
As for Haribo, heck, we’ve been waiting for you to arrive a long time. In briefly chatting with Keith Danoff, v.p. of marketing for Haribo USA, the company’s been looking. As he related, “The company has examined a lot of sites in the last several years.”
And even though I’m no fan of the Packers, glad to hear it’s within striking distance of Chicago near Pleasant Prairie, Wis.
“We are planning to build one of the largest sites in the confectionery industry,” said Wes Saber, executive v.p. and cfo of Haribo of America, in a company release. “The new location provides ideal conditions to expand.”
Reportedly, the city of Pleasant Prairie has purchased a 438-acre site for a business park, and approximately 100 acres will be sold to Haribo. When it’s all said and done, we’re talking about a $242-million investment.
And despite its proximity to current corporate offices in Rosemont, Ill., there are no plans to move Haribo USA’s administrative offices to Wisconsin. Chicago does have its draws, you know, Wisconsin cheese and beer aside.
So what should we make of this? From my perspective, it attests to the health of the confectionery industry in the United States. As the world’s largest national confectionery market, it’s fantastic to see such confectionery leaders with rationale to invest heavily here. Moreover, it’s a testament to the continuing sophistication of U.S. consumers, as well as the industry itself.
So welcome Ferrero and Haribo; can’t wait to see your operations on U.S. soil.