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Hershey CEO fights hunger in Africa, preps for a busy Halloween in U.S.

Michael Santoli
Michael Santoli

Synonymous with indulgent treats in America, the Hershey Co. (HSY) is now exporting its resources and expertise to help deliver basic nutrition in Africa.

The chocolate maker has had a program in West Africa called Nourishing Minds, which works with local peanut growers to make a protein snack for schoolchildren. This month, the company announced it was joining a broader effort led by General Mills Co. (GIS), Partners in Food Solutions, to help further develop the food infrastructure in Africa.

Hershey CEO J.P. Bilbrey says these initiatives fit with his company’s long tradition of helping the underprivileged.

“Our company has really been about social impact, actually from the very beginning,” he tells us in the attached video interview from the Concordia Summit in New York. Company founder Milton Hershey founded a school for orphans, which continues to operate in Hershey, Pa. The trust he created to support the school remains the largest shareholder of Hershey.

He says companies donating know-how and helping to create sustainable productive organizations can have a greater ongoing impact than simple check-writing or public sector aid programs alone.

Across its business, Hershey must engage not just raw financial realities but the changing tastes and priorities of its customers, who increasingly favor brands that they conclude share their values. This goes beyond questions of whether the kinds of sugary treats Hershey makes contribute to childhood obesity or if researchers are finding new health benefits from eating dark chocolate.

We talk a lot about consumers having a changing relationship with food,” Bilbrey says. “There's a thirst for information about who sourced it, where did it come from, who are the people that made it, can I relate to them, what's the purpose of their company. I think it's really positive.”

While it’s doing good in Africa, Hershey is trying to do well by expanding its brands further into China. While a small piece of Hershey’s overall business, China presents a challenge for Hershey. Not simply does the company need to contend with an apparent consumer slowdown, but there is not a long chocolate-eating tradition there.

“The important thing to remember about China and many of the developing markets around the world is that wherever you have an emerging middle class, that's what we're really focused on and that's why it's interesting to us as a company,” Bilbrey says. “And it's really a matter about building consumption habits. With our type of products, it's about building brands, and it's being there for the long haul.”

About the most certain part of Hershey’s business is the Halloween rush in the U.S.

Bilbrey says the season is shaping up nicely. He anticipates about a 7% rise in sales over a year ago, with a 4% volume increase and the rest from price increases.

Perhaps not surprising, folks who start seeing Halloween candy displays in the stores in late September begin to stock up – and it’s not just to lay in supplies for trick-or-treaters.

“A lot of that is self-consumption – consumption that happens actually ahead of the holiday,” says Bilbrey. Imagine that -- people unable to resist a pantry full of Hershey’s Kisses and Reese’s Pieces a month before the kids in costume start ringing the doorbell.