Hershey has officially opened its expanded chocolate factory in West Hershey, PA, unveiling “technology never before used in the manufacture of confectionery”.
Hershey has spent $300m on doubling the size of the factory, which was built in 1991 and is less than two miles away from where its founder Milton Hershey opened his first plant in 1905 on East Chocolate Avenue.
Employees have been progressively transferring from the original Hershey plant, which was closed in April.
The updated plant - dubbed the “world’s most technologically advanced chocolate making facility” - can make 70 million Hershey's Kisses a day, up from roughly 40 million before.
Proprietary, state-of-the-art technology
The new facility features “proprietary, state-of-the-art technology developed specifically for the plant”, including highly automated kit to produce Hershey's Kisses on a larger scale.
New IT systems include automated, real-time diagnostics systems, new high-speed production lines and “the most technologically advanced, automated chocolate syrup production lines in the world”.
A large amount has also been invested in logistics, employee facilities and computer-controlled manufacturing processes developed and adapted by Hershey’s operations team.
There is also a fresh almond roasting plant at the site, which operates a zero waste to landfill policy and is one of the firm’s eight manufacturing sites in the US.
Work on the latest expansion began in September 2010 and was completed on schedule earlier this year.
Project Next Century
The expansion at West Hershey is the largest component of Project Next Century – a program to modernize and upgrade Hershey’s global supply chain and ensure a competitive cost structure.
In the three months to July 1, 2012, Hershey posted a 6.7% rise in net sales to $1.414bn and a 4.4% rise in net income to $135.7m.
Speaking on a conference call with analysts in late July to discuss the results, president and CEO John P. Bilbrey said new launches including Ice Breakers Duo, Jolly Rancher Crunch 'N Chew, Rolo Minis and Hershey's Simple Pleasures were performing well.
“Our overall growth algorithm is to have about 1 point of growth from innovation. We feel good that we're probably going to, this year, be well above that, probably in the 1.5-plus point range, and we were better than that last year. So I think -- I think it's a good environment.”
Hershey - which has a stable of brands from Hershey’s Kisses to Reese's, Kit Kat, Twizzlers and Jolly Rancher - has forecast 2012 sales of $6.5bn, with about 15% of revenues generated from international markets.
By 2017, it is predicting revenues of $10bn, with a fifth of sales generated from international markets.