Grocery Industry Summary

The confectionary wholesaling industry is comprised of merchant wholesalers that distribute candy and other snack products to grocery stores, convenience stores, and mass merchandisers through internal direct-store-delivery and warehouse delivery systems. The companies with the largest market share reported to have done really well during the first half of the five years leading to 2015. These major companies include Nars, The Hershey Company, McLane Company Inc. and Core-Mark Holding Company Inc. that have a market share of 21.4%, 15.2%, 7.3%, and 2% respectively. However, the other half of this five-year period did not show much growth as the consumer market became more health conscious. This has led major companies to reformulate their brand strategies by coming up with new products and using premium ingredients to meet the demand of their wider consumer base. Even though the demand for candy and other similar snacks is far behind the demand of grocery products, the industry revenue has risen about 1.1% in 2015, making it a $49.6 billion industry. According to IBIS World, this industry will continue to benefit from its retailers, an increase in disposable …show more content…
In 2010 the prices of sugar went up 44.3%, leaving manufacturers with no other option but to raise their prices. Higher input costs were easy to manage for manufacturers, but not for wholesale distributors and retailers. For this reason, the five-year low of a 2.7% profit margin shaked the candy industry in 2012. However, from this point onward, consumer spending boosted the demand for these higher-margin products and greatly increased profits in 2013 and 2015. Towards the end of the five-year period, these high-margin goods like brand-name candy bars and premium chocolates became so popular that profit margins soared to 3.1% in