Wrigley to close Canada plant after North America sales gum-up
The Mars subsidiary will close the factory in March 2016 and will move production to the US.
“Despite recent improvements in the gum category and increased productivity in our supply chain network, it has not been enough to offset declines in the gum category over recent years,” said Wrigley in a statement.
North America sales declines
Value sales in the North American gum market fell 22% from 2009 to 2014 to $4bn, according to Euromonitor International. This represented a decline in compound annual growth rate (CAGR) of -4.7%. The global gum market grew 0.3% over the same period.
Around 80% of volumes at Wrigley’s Toronto plant are for the US market. Production from Toronto will move to Wrigley’s Gainesville facility in Georgia, US.
Declines to slow
Euromonitor forecasts that value sales in the North America gum market will register a negative CAGR of -2.1% between 2014 and 2019, totaling sales of $3.6bn. The global gum market is expected to grow 1.5% over the period to $26.5bn.
In the company’s statement, Wrigley added: “Mars’ commitment to Canada remains unchanged, employing more than 1,200 associates in sales, marketing and manufacturing across our four business segments. We will continue to operate a Wrigley Canada head office and invest in our Canadian business, including Excel, Canada’s number one gum brand.”
