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Hershey seeks to reduce calorie counts with product reformulation, size adjustment

Douglas Yu

By Douglas Yu+

25-Apr-2017
Last updated on 27-Apr-2017 at 10:22 GMT2017-04-27T10:22:12Z

About 31% of Hershey’s standard- and king-size confectionery products are 200 calories or less.  Photo: Hershey
About 31% of Hershey’s standard- and king-size confectionery products are 200 calories or less. Photo: Hershey

Hershey has included in its five-year plan a goal that 50% of its total offering of individually wrapped standard- and king-size confectionery products will be 200 calories or less. 

Additionally, 100% of Hershey standard- and king-size confectionery products will carry the “facts up front” calorie label by the end of 2018, according to a release.

Currently, about 31% of Hershey’s standard- and king-size confectionery products are 200 calories or less, including the recently launched cookie layer crunch , and 70% of products carry the facts up front calorie label, the company said.

 

Source: Hershey

Hershey said the calorie reduction targets will be achieved through “a combination of reformulation, innovative new products and adjusting the size of certain items in the portfolio.”

However, the company’s spokesperson Jeff Beckman mentioned it is too soon to say which specific products will be altered by the plan at the moment.

Sugar reduction

The R&D team at Hershey will undertake the product reformulation, using “new technologies” to reduce sugar, Beckman said.

“Hershey has patented technologies that boost sweetness of a confection by altering the surface area and shape of sugar particles in chocolate. And Hershey is working on other technologies that naturally boost the sweetness of confections,” he said.

“As we explore sugar reduction, we are also committed to maintaining the same great taste of our delicious products that consumers know and love.”

“At the same time, we are committed to continuing to expand our offering of products made with simple ingredients,” Beckman added.

Does it come with a price increase?

Beckman said there will be costs associated with product reformulation, adjusting the product sizes and transitioning products into simple ingredients, but at this time, Hershey has “no plans to change pricing.”

“There are many inputs that go into the cost of making products,” he said. “We always keep a close eye on our costs and margins so that we deliver value to our shareholders,”

Business outlook

Hershey reported a net income decrease of 49% during Q4, and 40% net income increase during full-year 2016, ConfectioneryNews recently reported.

“We continue to expect net sales to increase around 2% to 3% [in 2017], adjusted gross margin expansion of 15 basis points to 25 basis points and adjusted earnings per share diluted growth of 7% to 9%,” Hershey said. 

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