Sweet performance from Swiss confectioners

Related tags Cent Confectionery Switzerland

Exports of sugar confectionery from Switzerland rose by more than
10 per cent last year, offsetting a mediocre performance on the
home market. But with imports taking a lesser share of sales this
year, the industry hopes that focusing on upmarket products will
help keep domestic sales high in 2004, writes Chris Jones.

The 10 per cent increase in export volumes helped the sugar confectionery industry to a record sales figure of SF176 million in 2003, according to industry association Biscosuisse. Of the 16,000 tons of sugar confectionery exported by Swiss manufacturers in 2003, the majority (55.4 per cent) were sugar-free, reflecting the growing trend towards healthier. In 2002, sugar-free products accounted for 51 per cent of total exports.

Germany was the biggest export market, accounting for 22.5 per cent of all foreign sales, followed by the US with 19 per cent.

Exports now account for 68 per cent of the total sugar confectionery output of Switzerland, a reflection both of the difficulties faced by the recession-hit domestic market and the efforts of manufacturers to build a market outside their own country by focusing on premium products.

There was some good news on the domestic market, however, with sales of SF99 million remaining virtually unchanged from the previous year despite a 3.2 per cent drop in volumes to 7,400 tons. As well as this improvement in margins, the domestic performance was helped by a 2 per cent drop in imports of sugar confectionery products, although foreign sweets still account for the lion's share of the market (68.2 per cent).

All product categories contributed to the good overall performance, which saw combined domestic and export sales rise 6.3 per cent to SF275 million. Only dragées (sugar coated nuts or fruit) saw a drop in sales, but this product sector is small compared to the rest of the industry, dominated by sweets, chewing gum, marzipan and, increasingly, functional confectionery products.

After several poor years, hit by the weak Swiss economy, a reduction in tourist numbers and exceptionally hot weather, the 11 companies producing sugar confectionery finally have reason to be optimistic, with sales returning to the levels seen in 2000 before the economic downturn took effect.

But a tighter focus on high quality, high margin products, both at home and abroad, will be needed to sustain this growth in the coming years, especially as there is little sign of an upturn in the global economy in the immediate future.

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