1 Introduction about the company1.1 Overview about Hershey Hershey Company, also known as 1894–1927 Hershey Chocolate Co., 1927–68 Hershey Chocolate Corporation, and 1968–2005 Hershey Fo
Overview about Hershey
Hershey Company, also known as (1894–1927) Hershey Chocolate Co., (1927–
Hershey Chocolate Corporation—later Hershey Foods Corporation (1968–2005)—is an American manufacturer of food products, chiefly chocolate and sugar-based confections Hershey’s Milk Chocolate, packaged in its brown-and-silver wrapper, was perhaps the best-known American candy bar of the 20th century The company is headquartered in Hershey, Pennsylvania.
The Hershey Company traces its origins to the 1880s when Milton S Hershey founded the Lancaster Caramel Company in Lancaster, Pennsylvania After seeing German-made chocolate-processing machinery at the World’s Columbian Exposition of 1893 in Chicago, Hershey decided to enter the chocolate business, a move that would launch Hershey's iconic chocolate legacy.
During the 1960s, Hershey expanded by acquiring the manufacturer of Reese’s Peanut Butter Cups and two pasta businesses In recognition of this diversification, the company was renamed Hershey Foods Corporation in 1968 Two notable changes followed soon after: the price of the standard milk chocolate bar, which had stayed at five cents for decades, rose.
10 cents (bar size had diminished over the years) And in 1970 the company responded to increased competition—most notably from Mars, Inc.—by advertising to consumers for the first time.
Hershey History – A History of Goodness
Milton Hershey's love for confection began in childhood and blossomed when he founded The Hershey Chocolate Company in 1894 By 1900, the company had introduced its first candy bar Today, Hershey’s portfolio of brands has expanded far beyond the beloved HERSHEY’S Milk Chocolate Bar.
1894: Lancaster Caramel Company: Milton Hershey incorporates the Lancaster Caramel Company and establishes Hershey Chocolate Company as a subsidiary.
1900: Milk Chocolate bars: Launch of Hershey’s Milk Chocolate bars
1907: Hershey’s Chocolate Kisses: Hershey begins manufacturing Hersey’s Chocolate Kisses.
1963: H.B Reese Candy Company: Hershey acquires H.B Reese Candy
1971: Hershey’s Tropical Bar: Hershey’s Tropical Bar sent to the moon with Apollo 15 Astronauts
1973: Hershey’s Chocolate World: Hershey’s Chocolate World, the first retail center, opens
1979: $1 Billion Achieved: Hershey achieves $1 billion in annual sales
2000: World Cocoa Foundation: Founding member of the World Cocoa
Foundation and begins investment in West Africa to support cocoa farmers and improve cacao agriculture.
2018: Michele Buck becomes CEO: first female CEO
2019: #35 on Diversity Inc: The Hershey Company recognized as #35 on Diversity Inc Top 50 Companies for Diversity
Hershey Products
Hershey is best known for its chocolate products, including Hershey’s Brand chocolates such as Extra Dark, Symphony, Drops, Miniatures, Pot of Gold, and Nuggets The lineup also features Hershey’s Kisses and Reese’s Brand products, highlighting the brand's wide range of popular confections.
2 Situation of Hershey organization in nowadays
In August 2021, The Hershey Company announced a comprehensive health and safety policy mandating full vaccination for all corporate employees stationed at designated facilities, including the 19E Corporate Office, Tech Centre, U.S commercial sales offices, and Customer Teams, as well as salaried staff at Hershey's Chocolate World and the company’s Amplify, One Brands, and Lily’s offices.
As of October 4, 2021, the company supported public health initiatives by sponsoring multiple vaccination clinics and permitting employees to request accommodations for religious or medical reasons The organization has conducted an interactive process with employees to assess when accommodations are necessary, ensuring a careful review of individual circumstances and timely responses.
Under this vaccination policy, roughly 98 percent of the teams covered are vaccinated, and in recent weeks a small number of teammates—less than 2 percent of our corporate and commercial teams who did not receive the vaccine—have been separated.
From the outset of the pandemic, our manufacturing and retail teams have operated safely on the front lines, guided by intensified health and safety measures These include mask-wearing, physical distancing, thorough sanitization, and convenient on-site vaccination clinics to protect employees and customers By maintaining these protocols, we’ve supported safe operations while continuing to serve our communities.
The Hershey Company has committed over $2 million in cash and product donations to support COVID-19 response efforts worldwide Our corporate giving team is working closely with community non-profit partners to ensure they are supported during this time As needs evolve throughout the pandemic, our support and community response efforts will continue to adapt to meet those changing requirements.
Additionally, our Hershey Company Employees 1 st Fund is actively supporting Hershey employees and their families who experience severe economic hardship as a result of this situation.
3 Hershey’s Vision/ Mission/ Core Values
Vision statement
Hershey's vision is to offer the best merchandise at the best prices while making the shopping experience enjoyable, underpinned by a commitment to delivering excellent services at affordable rates The company is focused on offering healthy products and on changing the perception that chocolate brands are unhealthy.
The vision statement rests on two core ideas: delivering the finest merchandise at the most competitive prices and making the shopping experience enjoyable for every customer This focus targets all Hershey consumers and potential buyers, supported by a global footprint in over 90 countries and a plan to expand by offering products at prices that are affordable for everyone The affordability of Hershey’s products drives appeal among both corporate clients and individual customers, reinforcing the brand’s reach and growth worldwide.
Hershey prioritizes an enjoyable shopping experience by ensuring value for money, delivering high-quality products at competitive and affordable prices The Hershey Company aims to provide customers with the best products at prices that are both competitive and affordable, while also investing in social responsibility through initiatives like the Hershey Trust Company to support disadvantaged children.
Mission Statement
Guided by Milton Hershey's enduring legacy of responsibility to customers, communities, and children, we deliver high-quality Hershey's products while conducting our business in a socially conscious and environmentally sustainable way.
Core Values
Deliver
Prototype testing drives rapid solutions and continuous learning This iterative, evidence-based approach speeds up problem-solving as we learn from real-world results We proactively connect with colleagues and available resources to uncover answers faster, leveraging collaboration to improve outcomes Every decision aims to benefit the community and is implemented promptly, ensuring actions are taken sooner rather than later.
Collaborate
We believe in achieving outcomes through global partnerships and a collaborative approach, learning from others, valuing their opinions, and appreciating their skills and expertise Even with diverse perspectives, we listen to one another and openly voice our viewpoints, ensuring every input is heard Once a decision is made, we commit to executing it and driving toward the shared goal.
Develop
At HERSHEY’S, we encourage everyone to learn and keep growing We nurture an environment where everyone is allowed to experiment with ideas, invite diverse perspectives, celebrate successes and share learnings from our own mistakes We also keep an open window of feedback that will help us learn from others.
Question
We invite everyone to question ideas by focusing on processes, problems, and opportunities, embracing critical thinking and curiosity We encourage people to challenge or improve the existing norms and conventions of the system, knowing that thoughtful inquiry can lead to better outcomes We draw inspiration from the world around us, ponder essential questions, and turn the gathered data into resourceful, actionable insights that drive meaningful improvement and innovation.
Innovate
Hershey’s fosters a culture of innovation by consistently inviting everyone to share new and unconventional ideas and approaches By encouraging constructive challenge to the status quo and inviting fresh perspectives on how we can change or innovate, we open the door to new insights and possibilities.
Inspire
We thrive on our individual passions while drawing inspiration from others, fostering an environment where every team member feels empowered and encouraged to explore a wide range of new possibilities We speak with conviction and listen closely to our coworkers, which helps us cultivate a shared, clear vision that unites us and drives meaningful innovation.
4 Hershey’s SWOT analysis (SFAS, IFAS, EFAS, CPM matrix)
SWOT analysis
Strengths Analysis
As a leading player in the confectionery sector, Hershey leverages a broad set of strengths that drive its ongoing success in competitive markets These strengths not only defend its market share in established markets but also enable entry into new markets and fuel future growth opportunities.
Highly successful at Go to Market strategies for its products.
Successful track record of developing new products – product innovation.
Reliable suppliers – It has a strong base of reliable supplier of raw material thus enabling the company to overcome any supply chain bottlenecks.
Automation of activities brought consistency of quality to Hershey products and has enabled the company to scale up and scale down based on the demand conditions in the market.
With a dedicated customer relationship management (CRM) department, the company has achieved a high level of customer satisfaction among its current customers and built strong brand equity among potential customers This CRM-driven approach enables consistent, personalized service and proactive support, turning satisfied clients into loyal advocates and attracting new prospects through positive perception and trust.
A strong dealer network has fostered a collaborative culture among distributors and dealers, where partners not only promote the company's products but also invest in training their sales teams to help customers unlock the maximum value and benefits from the products.
Strong distribution network – Over the years Hershey has built a reliable distribution network that can reach majority of its potential market.
Good Returns on Capital Expenditure – Hershey is relatively successful at execution of new projects and generated good returns on capital expenditure by building new revenue streams.
Weaknesses Analysis
Hershey’s weaknesses are the areas where the company can improve, and a strategic approach centers on choosing the right priorities to address those gaps Using SWOT analysis helps identify these weaknesses, assess their impact on performance, and plan how to convert them into opportunities that reinforce Hershey’s competitive advantage and strengthen its strategic positioning in the market By targeting improvement areas through disciplined strategy development, Hershey can close gaps, optimize operations, and maintain a durable edge over rivals.
There are gaps in the product range sold by the company This lack of choice can give a new competitor a foothold in the market.
Despite being a leading player in its core business, Hershey has achieved limited success when trying to expand into other product segments The company's current culture appears to constrain diversification efforts, making it difficult to move beyond its established strengths This mismatch between core competency and growth initiatives underscores the challenge of broadening the portfolio without cultural and strategic alignment Addressing these cultural barriers could unlock opportunities in new markets and support a more robust growth strategy.
Organization structure is only compatible with present business model thus limiting expansion in adjacent product segments.
Days inventory is high compare to the competitors – making the company raise more capital to invest in the channel This can impact the long-term growth of Hershey
Hershey shows a higher attrition rate compared with industry peers, indicating greater workforce turnover This elevated turnover compels the company to invest more in training and development to onboard, upskill, and retain employees, resulting in HR and L&D spending that surpasses its competitors.
Product marketing has fallen short, with messaging and positioning not clearly defined Despite strong sales, the product's positioning and unique selling proposition are unclear, leaving the brand vulnerable to competitive threats in the market segment A clearer value proposition and cohesive brand messaging are needed to defend against rivals and improve the product's overall market positioning and SEO visibility.
Financial planning is currently insufficient and inefficient, and an analysis of the current asset ratio and liquidity ratios shows that the company could deploy its cash more effectively than it does today By tightening financial planning and optimizing cash management, the business can improve cash utilization, enhance liquidity, and boost overall financial performance.
Opportunities Analysis
The new technology gives Hershey the opportunity to deploy a differentiated pricing strategy in a new market It enables the firm to maintain its loyal customers by delivering great service It also helps lure new customers through value-oriented propositions Together, these elements position Hershey to grow its presence in the new market.
Lower inflation rate – The low inflation rate brings more stability in the market, enable credit at lower interest rate to the customers of Hershey.
Over the past several years, Hershey has invested heavily in its online platform, establishing a new online sales channel This digital investment has unlocked growth opportunities by attracting new customers and expanding the company’s reach In the coming years, Hershey can maximize this potential by gaining deeper customer insights and meeting their needs more effectively through big data analytics and data-driven personalization.
Government green drive also opens an opportunity for procurement of Hershey products by the state as well as federal government contractors.
New environmental policies are creating opportunities by leveling the playing field for all industry players, driving fair competition and encouraging innovation For Hershey, these developments represent a strategic opportunity to advance its leadership in new technology and capture greater market share in the emerging product category.
Government agreements are opening new markets for Hershey by standardizing technology and enabling free trade, giving the company a clear path to enter an emerging market The adoption of new technology standards, alongside a government free trade agreement, creates favorable conditions for Hershey to expand its confectionery footprint in a growing market and tap into rising demand.
The new taxation policy can significantly impact the way of doing business and can open new opportunity for established players such as Hershey to increase its profitability.
The market development will lead to dilution of competitor’s advantage and enable Hershey to increase its competitiveness compare to the other competitors.
Threats Analysis
Increasing trend toward isolationism in the economy can lead to similar reaction from other government thus negatively impacting the international sales.
Intense competition and stable profitability have drawn more players into the industry over the last two years, heightening competitive pressure This influx has created downward pressure on both profitability and overall sales.
The company can face lawsuits in various markets given - different laws and continuous fluctuations regarding product standards in those markets.
Demand for highly profitable products is seasonal, peaking at specific times of the year Any unlikely disruption during the peak season can affect the company’s profitability in the short to medium term, highlighting the need for seasonal risk management and contingency planning.
Rising pay level especially movements such as $15 an hour and increasing prices in the China can lead to serious pressure on profitability of Hershey
Imitation of the counterfeit and low-quality product is also a threat to Hershey’s product especially in the emerging markets and low-income markets.
Growing strengths of local distributors also presents a threat in some markets as the competition is paying higher margins to the local distributors.
SFAS Analysis
Key Strategic Weight Rating Weighted Duration Comments
Successful track 0.1 4 0.4 X Product innovation record of developing new products
Reliable 0.05 3 0.15 X It has a strong base suppliers of reliable supplier of raw material thus enabling the company to overcome any supply chain bottlenecks.
With a dedicated customer relationship management (CRM) department, the company has achieved a high level of customer satisfaction among its present customers and built strong brand equity among potential customers Weaknesses remain to be addressed to sustain momentum and support long-term growth.
The product’s market success remains unclear because its positioning and unique selling proposition are not clearly defined, weakening its messaging in the market Without a clear value proposition and differentiation, the brand risks attacks from competitors in the target segment and could lose market share to better-positioned rivals.
Limited success 0.1 2 0.2 X Hershey is one of outside core the leading business organizations in its industry it has faced challenges in moving to other product segments with its present culture.
Lower inflation 0.1 5 0.5 X The low inflation rate rate brings more stability in the market, enable credit at lower interest rate to the customers of Hershey.
New customers 0.05 3 0.15 X The company can from online leverage this channel opportunity by knowing its customer better and serving their needs using big data analytics.
Opening up of 0.1 3 0.3 X The adoption of new new markets technology standard and government free trade agreement has provided Hershey an opportunity to enter a new emerging market. Threats
Intense market competition has brought more players into the industry over the last two years, increasing competitive pressure and broadening the field This influx of participants has put downward pressure on profitability and overall sales, signaling a tougher demand environment and tighter margins for firms in the sector.
The company 0.1 4 0.4 X Different laws and can face lawsuits continuous in various fluctuations markets given regarding product standards in those markets.
Growing 0.1 3 0.3 X A threat in some strengths of markets as the local distributors competition is paying higher margins to the local distributors.
IFAS – EFAS Analysis
- Market strategies for its - Gaps in the product range products - Limited success outside
- Developing new products core business
- Reliable suppliers - Only compatible with
- Strong dealer community - High days inventory.
- Good returns on capital expenditure
Strength Opportunities (SO) Strength Threats (ST)
Leveraging brand recognition Investing into R&D to in new segments thwart Consumer/Non-
Weakness Opportunities (WO) Weaknesses Threats (WT)
Investing into customer- Get out of the business and oriented services and supply focus on growth areas chain
Porter’s Five Forces Analysis of Hershey's maps the brand's competitive landscape and the factors shaping the confectionery sector The analysis evaluates Hershey's position across the five forces—threat of new entrants, threat of substitutes, bargaining power of buyers, bargaining power of suppliers, and competitive rivalry—to gauge industry attractiveness and guide strategic decisions around pricing, product innovation, supplier relations, and market-entry barriers.
Hershey's Five Forces analysis helps to analyse its current position in the market based on factors like competitors, customers, suppliers, financial strength & alternate solutions.
Threat of New Entrants
The threat of new entrants in Hershey’s Porter Five Forces analysis is relatively moderate given Hershey’s status as a global leader in chocolate and confectionery Hershey’s broad product portfolio—covering chocolate and non-chocolate confectionery as well as baked sweets—along with strong brand equity, extensive distribution networks, and economies of scale, creates high barriers to entry New competitors would face substantial capital requirements for manufacturing, regulatory compliance, and challenges in securing shelf space and retailer partnerships entrenched consumer loyalty to established brands and experienced marketing capabilities further deter new entrants Still, entrants can target niche segments, premium or healthier product lines, or leverage online channels to disrupt the market, but they must overcome incumbent advantages in brand recognition, supply chain efficiency, and pricing power.
206 billion USD currently and is projected to reach up to 225 billion USD in the next couple years.
Hershey’s targets a broad audience, as reflected in its slogan there is something for everyone, and it offers a wide range of products—from chocolates, candies, and mints to spreads and beverages—to appeal to different income levels and ages The company operates in more than 70 countries worldwide, giving it a strong global footprint and brand presence For new entrants, maintaining competitive prices is challenging because economies of scale favor established players like Hershey’s and other large manufacturers Moreover, incumbents benefit from well-developed supply chains, robust distribution networks, and a trusted brand image, making shelf space and other retail resources a major barrier Taken together, these factors contribute to a low threat of new entrants on a global scale.
Threat of Substitutes
Below are the threats of substitute products of Porter’s Five Forces analysis of Hershey's: The chocolate confectionery industry offers highly differentiated products.
The confectionery industry centers on chocolate products—spreads, bars, and candies—and while other sweets and baked goods can function as substitutes, they are not true replacements for chocolate offerings These substitute options are produced by large manufacturers, restaurants, and local eateries at a range of price points and varieties Because the number of substitutes is limited, customers face no significant switching costs when moving to an alternative product, making the threat of substitutes a moderate force for The Hershey Company.
Bargaining Power of Customers
In the Hershey's Porter Five Forces Analysis the bargaining power of the customers can be explained as:
Global confectionery market has a very high volume of customers and exceeds $200 billion in size Leading players such as Mars and Hershey’s achieve global sales in the tens of billions of dollars, illustrating the market’s scale Although total sales are substantial, revenue per customer remains relatively small, signaling lower buyer bargaining power in this mass-market segment.
In the confectionery industry, products are differentiated by taste and composition, with some items exclusive to certain companies and highly popular among consumers, indicating weak buyer bargaining power The customer base is broad; despite price sensitivity among low- and middle-income segments, the overall large-volume demand dilutes buyers’ leverage Although there are no switching costs and a large pool of customers, buyers can exert some bargaining power in this context Overall, buyer power in the confectionery industry is weak to moderate.
Bargaining Power of Suppliers
Following is the bargaining power of suppliers in the Porter’s Five Forces analysis of Hershey's:
Hershey's primarily sources cocoa from local farmers in West Africa, while other inputs come from a broad network of suppliers The large number of suppliers and their dispersed concentration reduce supplier bargaining power, and no supplier offers exclusive or highly differentiated products, making it unlikely they can disrupt production by withholding materials As a result, Hershey's can easily switch to alternative suppliers with minimal switching costs.
Hershey weaknesses are the areas where the company can improve, and identifying these through SWOT analysis informs strategic choices that strengthen competitive advantage and strategic positioning By focusing on weaknesses, Hershey can prioritize improvement initiatives, optimize resource allocation, and turn gaps into opportunities that enhance brand value and support long-term growth.
There are gaps in the product range sold by the company This lack of choice can give a new competitor a foothold in the market.
Limited success outside core business – Even though Hershey is one of the
Organization structure is only compatible with present business model thus limiting expansion in adjacent product segments.
Days inventory is high compare to the competitors – making the company raise more capital to invest in the channel This can impact the long-term growth of Hershey
Compared with other organizations in the industry, Hershey experiences a higher attrition rate, which in turn drives substantially greater spending on training and development to retain and upskill its workforce This elevated turnover also increases recruitment and onboarding costs and can impact productivity, making ongoing investment in employee development essential to maintain competitive capability Aligning talent strategies with attrition trends and optimizing training investments will be key to reducing long-term costs while safeguarding performance.
Although the product delivers strong sales, its marketing is underdeveloped, and its positioning and unique selling proposition remain unclear This ambiguity invites competitive attacks and weakens brand messaging in the market To strengthen market impact and defend against rivals, the strategy should establish a clear, differentiated positioning and a compelling USP, supported by targeted marketing efforts and messaging that resonates with the intended audience.
Financial planning is not being executed efficiently, leading to suboptimal cash management The current asset ratio and liquidity ratios indicate the company could use its cash more effectively than it does today By tightening financial planning and optimizing cash utilization, the organization can improve liquidity and boost overall financial performance.
New technology gives Hershey the opportunity to implement a differentiated pricing strategy in new markets This approach will help retain loyal customers by delivering exceptional service and attract new buyers through value-oriented propositions By leveraging the technology, Hershey can tailor pricing to different customer segments, strengthening loyalty while expanding its reach with compelling offers that emphasize value.
Lower inflation rate – The low inflation rate brings more stability in the market, enable credit at lower interest rate to the customers of Hershey.
Over the past few years, Hershey has invested heavily in its online platform, turning it into a new sales channel that complements traditional channels This digital commitment has opened a major growth opportunity by connecting with more customers through online channels Looking ahead, Hershey can maximize this advantage by applying big data analytics to understand customer preferences, anticipate needs, and deliver personalized experiences across its online platform.
Government green drive also opens an opportunity for procurement of Hershey products by the state as well as federal government contractors.
New environmental policies create a level playing field for all players in the industry, unlocking opportunities for Hershey to leverage its advantage in new technology and gain market share in the emerging product category By aligning with regulatory shifts, Hershey can accelerate innovation, strengthen its competitive position, and expand its footprint in sustainable, high-growth markets This policy evolution signals a strategic moment for Hershey to capitalize on its tech leadership and drive growth in the next-generation product category.
Opening up of new markets because of government agreement – the adoption of new technology standard and government free trade agreement has provided Hershey an opportunity to enter a new emerging market.
The new taxation policy can significantly impact the way of doing business its profitability.
The market development will lead to dilution of competitor’s advantage and enable Hershey to increase its competitiveness compare to the other competitors.
Increasing trend toward isolationism in the economy can lead to similar reaction from other government thus negatively impacting the international sales.
Intense competition – Stable profitability has increased the number of players in the industry over last two years which has put downward pressure on not only profitability but also on overall sales.
The company can face lawsuits in various markets given - different laws and continuous fluctuations regarding product standards in those markets.
Profitability for high-margin products is seasonally driven, so peak-season performance remains vulnerable to unexpected events Even unlikely disruptions during this critical period can weigh on the company’s profitability in the short to medium term.
Rising pay level especially movements such as $15 an hour and increasing prices in the China can lead to serious pressure on profitability of Hershey
Imitation of the counterfeit and low-quality product is also a threat to Hershey’s product especially in the emerging markets and low-income markets.
Growing strengths of local distributors also presents a threat in some markets as the competition is paying higher margins to the local distributors.
Key Strategic Weight Rating Weighted Duration Comments
Successful track 0.1 4 0.4 X Product innovation record of developing new products
Reliable 0.05 3 0.15 X It has a strong base suppliers of reliable supplier of raw material thus enabling the company to overcome any supply chain
High level of 0.1 4 customer satisfaction
X the company with its dedicated customer management department has able to achieve a high level of customer satisfaction among present customers and good brand equity among the potential customers Weaknesses
While the product has strong sales potential, current marketing efforts are not yet aligned with a clear market opportunity The product’s success hinges on clearly defined positioning and a compelling unique selling proposition, which are currently underdeveloped Without a sharpened USP and targeted messaging, the brand risks competitive pushback and losing share in its segment A focused plan should define the target audience, articulate the key benefits, and differentiate the product to unlock sales and sustain competitive advantage.
Limited success 0.1 2 0.2 X Hershey is one of outside core the leading business organizations in its industry it has faced challenges in moving to other product segments with its present culture.
Lower inflation 0.1 5 0.5 X The low inflation rate rate brings more stability in the market, enable credit at lower interest rate to the10 customers of
New customers 0.05 3 0.15 X The company can from online leverage this channel opportunity by knowing its customer better and serving their needs using big data analytics.
Opening up of 0.1 3 0.3 X The adoption of new new markets technology standard and government free trade agreement has provided Hershey an opportunity to emerging market Threats
Intense competition has broadened the pool of players in the industry over the past two years, reshaping the competitive landscape This influx has put downward pressure on profitability as margins compress and pricing becomes more aggressive Consequently, overall sales have also slowed, compelling companies to differentiate through innovation, value, and efficiency to sustain growth.
The company 0.1 4 0.4 X Different laws and can face lawsuits continuous in various fluctuations markets given regarding product standards in those markets.
Growing 0.1 3 0.3 X A threat in some strengths of markets as the local distributors competition is paying higher margins to the local distributors.