Mars looks to make $1bn from ice cream
CHICAGO: Mars Inc, one of the world’s largest chocolate makers, has tapped US executive Anton Vincent to lead its global ice cream effort and turn the business into a $1 billion brand by 2030.
Vincent, who has been president of Mars Wrigley in North America for four years, has been given the added role with responsibility of expanding a $400 million business that includes frozen versions of its Twix and Snickers chocolate bars.
“Ice cream is about a $80 billion category around the globe, and it’s going to be about $100 billion by 2030,” Vincent said in an interview at the Sweets & Snacks Expo in Chicago. “We see a real opportunity, clearly in the United States, and all around the globe.”
Candy makers such as Mars have been trying to capitalise on rising demand for frozen treats, with consumer spending on indulgences holding up despite soaring inflation. Global ice cream sales have risen 16% in the past five years and are expected to jump another 35% by 2027, according to consumer research firm Euromonitor International.
Mars, one of the largest closely held companies in the US, has been in the ice cream business for more than three decades, but “got very serious” about growing it four years ago, Vincent said. The confectionery giant owned by the Mars family recently opened a factory in China, adding to its frozen treats footprint in France and the US — where it runs a facility outside Chicago.
Ice cream competitors include Unilever, with 20% of the market, Nestlé SA with a 10% share and the 4% held by General Mills Inc, according to Euromonitor.
Mars is eyeing growth in places where it already has ice cream factories, as well as in emerging markets. The company will focus first on expanding brands it owns though it isn’t ruling out takeovers.
“We certainly want to be investing in new sites,” Vincent said. “And if they happen to come along with a potential acquisition, that’s something I think we have to consider as well.”
While inflation has started to ease, commodity costs could still rise as an El Niño weather pattern threatens both sugar and cocoa, key crops for chocolate makers. Raw sugar has already risen almost 30% this year, while cocoa futures are trading near their highest level since 2016.
Mars, which has annual sales of $45 billion, has been able raise prices, though Vincent said passing on costs to retailers and consumers is getting harder. In difficult economic times, candy makers usually apply promotions to boost sales. Mars is looking at packaging design and products to find additional ways to offer value to consumers, he said.
The company is also getting more “sophisticated” in using hedging mechanisms to cope with costs, Vincent said, declining to provide details.
“We try to use the instruments we have to hedge, to make sure we have the right cost forecasts,” he said.