Hershey hiking prices
Monica Watrous View Me on Google+
|Consumers will need to pay more for their favorite Hershey products.
HERSHEY, PA. — To offset higher costs for cocoa, dairy and nuts, the Hershey Co. is raising wholesale prices across most of its brands in the United States.
Hershey announced a weighted average price increase of approximately 8% across instant consumable, multi-pack, packaged candy and grocery lines, as the company expects to incur significantly higher costs for raw materials, packaging, fuel, utilities and transportation.
“Over the last year key input costs have been volatile and remain at levels that are above historical averages,” said Michele Buck, president, North America. “Commodity spot prices for ingredients such as cocoa, dairy and nuts have increased meaningfully since the beginning of the year.
“Given these trends, we expect significant commodity cost increases in 2015. We are a gross margin focused company and remain committed to our consumer-centric business model of bringing insights to retailers that will enable us to grow our business and the category. During the transition period we will support our brands with higher levels of investment, including merchandising, programming, advertising and innovation, that will benefit Hershey and the category.”
Hershey does not expect the pricing action to benefit fiscal 2014 earnings. Due to volume elasticity on everyday take-home and instant consumable products, U.S. channel mix headwinds, and higher-than-anticipated costs for dairy and other commodities, the company projects full-year net sales and earnings growth to be at the low end of its long-term targets.