Friday, December 9, 2011

Chocolate Candy Outsourcing



Hershey's is the creator of many brands of chocolate:

  1. Hershey's Kisses
  2. Hershey's Bliss
  3. Hershey's
  4. Reese's
  5. Kit Kat
  6. Twizzlers
  7. Almond Joy
  8. Ice Breakers


Because they make so many different kinds of candy, especially chocolate, they have decided to begin producing in Mexico. They have been around since 1894 and began in Lancaster, Pennsylvania and have become one of the most well-known brands in the world. 

Several of their facilities have been closed down in the United States and Canada and the jobs have been outsourced to contractors in Mexico at Hershey's new manufacturing facility there. This move will cut 1500 jobs here in the U.S. and in Canada. So why are they doing it?

It's to increase their profit. They had struggled a few years ago because they slashed their advertising budget and put the money to making limited edition candy flavors that didn't appeal to the masses. At the same time, they were no longer promoting the usual favorite Hershey's candies which caused a bit of a financial slump. 

By moving work to Mexico, they can keep the profit margin growing by outsourcing the jobs to places of cheap labor. Americans do understand the concept, but at the same time, if Hershey's is taking away jobs from Americans, they won't have the money to purchase the outsourced products. Buying Mexican-made chocolate won't exactly be at the top of the list of an American family that's struggling to survive on unemployment.


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