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Wednesday, March 25, 2009

From Evernote: A sugar-coated remedy for the crisis blues - International Herald Tribune


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A sugar-coated remedy for the crisis blues - International Herald Tribune

by rweinert

http://www.iht.com/articles/2009/03/23/america/candy.php?WT.mc_id=newsalert

Piper Gray, left, and Amy Lepley shopping at Economy Candy in Manhattan on March 15, 2003. (Chester Higgins Jr./The New York Times)

A sugar-coated remedy for the crisis blues

Published: March 24, 2009


NEW YORK:

Raymond Schneider politely elbowed his way through crowds of customers as he made a beeline for the bulk candy bins at Dylan's Candy Bar in New York.

Since he was laid off in December, Mr. Schneider, a 33-year-old interior designer, says he has become a "gummy junkie," stocking up on sweets every time he shops for groceries.

"Sugar is comforting," he said as he scooped Red Licorice Scottie Dogs into a plastic bag. "There's nothing more stressful than growing financial insecurity everywhere."

The recession seems to have a sweet tooth. As unemployment has risen and 401(k)'s have shrunk, Americans, particularly adults, have been consuming growing volumes of candy, from Mary Janes and Tootsie Rolls to gummy bears and chocolates, particularly inexpensive ones, candy makers, store owners and industry experts say.

Theories vary on exactly why. For many, sugar lifts spirits dragged low by the languishing economy, store owners and industry officials say. For others, candy also provides a nostalgic reminder of better times. And, not insignificantly, it's relatively cheap.

"People may indulge themselves a little bit more when times are tough," said Jack P. Russo, an analyst with the retail brokerage firm Edward Jones of St. Louis. "These are low-cost items that people can afford pretty easily."

At Chicago's Candyality store in the Lakeview neighborhood, business has jumped by nearly 80 percent compared with this time last year, and the owner, Terese McDonald, says she is struggling to keep up with the demand for Bit-O-Honeys, Swedish Fish and Sour Balls. At the Candy Store in San Francisco, the owner, Diane Campbell, has tripled her orders for nostalgic candies like Necco Wafers and Mallo Cups in recent months. Many of her customers tell her that even though they are living on less, they're setting aside cash for candy.

"They put candy in their actual budget," she said.

Many big candy makers are reporting rising sales and surprising profits even as other manufacturers are struggling to stay afloat. Cadbury reported a 30 percent rise in profits for 2008 while NestlĂ©'s profits grew by 10.9 percent, according to public filings. Hershey, which struggled for much of 2008, saw profit jump by 8.5 percent in the fourth quarter. Lindt & Sprungli, which specializes in high-end products like Lindt bars and Ghirardelli, said that even though it expected to close its luxury retail stores in 2009, it would remain profitable because of strong chocolate sales through middle-class retailers like Wal-Mart and Target.

"All is well in candy land," said Jamie Hallman, owner of the Sweet Dish candy store in the Marina district of San Francisco.

At the sugar-scented confines of Economy Candy on the Lower East Side in Manhattan, the owner Jerry Cohen said he increased his orders by 10 percent in January and February to keep up with demand. On a recent Sunday Mr. Cohen had about a dozen workers in the narrow store trying to keep the candy tables and penny candy bins restocked as shoppers — the majority of them adults — dug their hands into bins of Tootsie Rolls and Bit-O-Honeys.

"We have been wiping out inventory," he said. "They're reminiscing about the candies their parents used to have."

There may be historic precedent to the recessionary strength of the candy business. During the 1930s, candy companies thrived, introducing an array of confections that remain popular today. Snickers debuted in 1930. Tootsie Pops appeared in 1931. Mars bars with almonds and Three Musketeers bars followed in 1932.

Hershey, the dominant candy brand during the Depression, remained profitable enough through the 1930s that the company financed its own Works Progress Administration programs, said Pamela Whitenack, Hershey Community Archives director.

"Candy companies are relatively recession proof," said Peter Liebhold, chairman of the Smithsonian's work and industry division. "During the Great Depression, candy companies stayed in business."

Nostalgia may also be helping sales, as candy seems to conjure memories of times before bank collapses and government bailouts. Jackie Hague, vice president of marketing for the New England Confectionary Company in Revere, Massachussetts, which makes Necco wafers and other candies, says the company has received more letters, e-mails and telephone calls than usual from customers saying their candies had helped them "flash back to childhood."

Increased candy consumption may have already taken a toll on the waistlines of many New Yorkers. As Reba Pardieu, a science teacher, stood at the cashier at Economy Candy on the Lower East Side, she said she has been feeling anxious since her older daughter was laid off in December and her younger daughter, who recently graduated from college, had to settle for work as a dog walker. Budget cuts at her school have also forced her to pay for her own supplies, including the candy she was buying for a student project on D.N.A.

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