Candy Proving to Be Recession-Resistant

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Candy Proving to Be Recession-Resistant

CHICAGO – Best-in-class candy retailers in the convenience store industry utilize category management, effectively merchandise the product in secondary locations, execute programs superbly at the store level, and constantly promote and bring value to the candy category.

Those are just a few of the insights that came out of CSNews’ 2009 Candy & Snacks Best Practices Roundtable, sponsored by McLane Co. and held in conjunction with the National Confectionery Association’s All Candy Expo.

Representatives from some of the convenience store industry’s biggest retailers, including BP ampm, Circle K, E-Z Mart, Green Oil, Kum & Go, Nice N Easy, Travel Centers of America and Valero Retail Holdings, met last Thursday to discuss best practices and trends in the candy and snack categories, and to share their opinions on some of the hottest new products they saw at the All Candy Expo.

Other observations from the group included:

-- Retailer-hosted trade shows for store managers, licensees and/or franchisees is an effective way to improve store-specific merchandising;

-- Smaller shippers from manufacturers, particularly ones that can clip to the sides of existing store fixtures rather than clutter up a crowded sales floor, are the preferred method for introducing new products or limited-run special items;

-- Less pre-pricing on product from manufacturers gives retailers more flexibility to manage their profit margins;

-- King-sized candy is growing so fast it will surpass regular size this year in sales;

-- SKU-rationalization is a key best practice. "If something is not selling, mark it down right away and get rid of it," said one retailer.

Some of the attendees were also interested in seeing more multi-vendor displays—the type that have been so popular in the snack business—introduced in the candy section.

Candy and gum sales were up 4.7 percent last year, according to the CSNews 2009 Industry Report. "The sales increase was primarily driven by manufacturer price increases, which gave retailers the opportunity to raise prices to consumers and harvest more margin than in the previous year," said CSNews Editor-in-Chief Don Longo, who presented top line results of the annual CSNews study. "Candy has proven to be, if not recession-proof, then at least recession-resistant," he commented.

The 2009 CSNews Candy & Snacks Best Practices Roundtable was sponsored by McLane Co.