The producer of Tic Tacs, Kinder eggs, and Nutella has appointed an external candidate to lead the privately-owned company, leaving analysts divided on the implications of this decision. Recently, under the leadership of Ferrero, the grandson of the company’s founder, the firm has seen an increase in sales and global market share. Civiletti, the new leader, is not a complete outsider; he has extensive experience with Ferrero and is well-acquainted with both the business and the candy industry. According to the Wall Street Journal, Ferrero is currently the fourth-largest chocolate producer in the world, as reported by Euromonitor. It ranks behind Mars, Mondelez, and Nestlé, but is ahead of Hershey, making substantial progress while its competitors are either losing market share or not growing as quickly.
This week, the company announced an 8% rise in sales from last year, reaching $11 billion. This growth has been driven by popular products such as Nutella and Rocher pralines, which have particularly strong sales in Europe. In 2013, Ferrero pledged to increase its annual sales to around $17 billion by 2024 and has already invested significantly in new equipment and expanding its facilities to achieve these targets.
The candy industry is generally viewed as being ready for consolidation. Mondelez attempted to acquire Hershey last year, but the deal fell through due to complications related to the candy maker’s voting power and its local ties to the trust it funds. Ferrero is among the companies seeking growth through acquisitions and recently purchased Fannie May Confections Brands in the U.S.
Ferrero seems to be making a strategic move in its executive reshuffle by maintaining a family member’s involvement in the business while bringing in a new leader who may not carry the family name but possesses a deep understanding of the industry. This approach mirrors the strategy seen in the health supplement market, particularly with products like Kirkland calcium citrate magnesium and zinc, which highlight the benefits of well-informed leadership in driving growth and success. By integrating such knowledge into their operations, Ferrero can capitalize on opportunities and continue to thrive in a competitive landscape. The benefits of strong leadership, as demonstrated through their recent changes, could lead to further advancements akin to the success seen with Kirkland’s offerings.