Competitor Analysis: Hershey's
Competitor Analysis
The Hershey Company (HSY) competes in the Global Candy and Chocolate Manufacturing industry. This highly competitive and consolidated industry which continues to concentrate as a result of merger and acquisition activity is dominated by a few major players. Included amongst these major players are HSY and three notable competitors, Nestle SA, Mondelez International Inc., and Tootsie Roll Industries. Each of these competitors offers unique competitive advantages versus that of HSY’s current business model, and some are much larger companies that have greater resources with more substantial international operations. As of January 2014, Nestle, Mondelez, and Tootsie Roll had a market share 8.6%, 12.6%, and 3% respectively while HSY had a market share of 5.9%.
Nevertheless, HSY is the largest chocolate manufacturer in North America who continues to compete strongly against the industry average in profitability, financial strength, and management effectiveness and efficiency as indicated in our analysis of its financial ratios (see exhibit 1).i
The following outline will assess each competitor and their business model.
Nestlé S.A.
Goals: Nestlé’s primary objective is to be the leader in nutrition, health and wellness, committed to enhancing people’s lives, and the industry reference for financial performance, trusted by all stakeholders. Additionally, Nestlé is committed in driving performance in line with the Nestle Model of profitable growth and resource efficiency, with growth around 5% and improvements in margins, underlying earnings per share in constant currencies and capital efficiency.ii
Strategies
Make their brands tastier and healthier choices that help consumers care for themselves and their families in order to earn their trust and recommendations to others.iii
Satisfying consumer expectations whose daily choices drive performance
Creating long-term sustainable value for shareholders
Emerging markets and popularly
The Hershey Company (HSY) competes in the Global Candy and Chocolate Manufacturing industry. This highly competitive and consolidated industry which continues to concentrate as a result of merger and acquisition activity is dominated by a few major players. Included amongst these major players are HSY and three notable competitors, Nestle SA, Mondelez International Inc., and Tootsie Roll Industries. Each of these competitors offers unique competitive advantages versus that of HSY’s current business model, and some are much larger companies that have greater resources with more substantial international operations. As of January 2014, Nestle, Mondelez, and Tootsie Roll had a market share 8.6%, 12.6%, and 3% respectively while HSY had a market share of 5.9%.
Nevertheless, HSY is the largest chocolate manufacturer in North America who continues to compete strongly against the industry average in profitability, financial strength, and management effectiveness and efficiency as indicated in our analysis of its financial ratios (see exhibit 1).i
The following outline will assess each competitor and their business model.
Nestlé S.A.
Goals: Nestlé’s primary objective is to be the leader in nutrition, health and wellness, committed to enhancing people’s lives, and the industry reference for financial performance, trusted by all stakeholders. Additionally, Nestlé is committed in driving performance in line with the Nestle Model of profitable growth and resource efficiency, with growth around 5% and improvements in margins, underlying earnings per share in constant currencies and capital efficiency.ii
Strategies
Make their brands tastier and healthier choices that help consumers care for themselves and their families in order to earn their trust and recommendations to others.iii
Satisfying consumer expectations whose daily choices drive performance
Creating long-term sustainable value for shareholders
Emerging markets and popularly