Hershey says it won’t be able to meet Halloween demand this year

( Business) — Bad news for Halloween enthusiasts. This year, you may be out of luck in the candy aisle.

“We won’t be able to fully meet consumer demand” for the October holidays, Hershey CEO Michele Buck warned Thursday in prepared comments on the company’s second-quarter results.

The problem? Consumers are demanding more regular and Halloween-themed candy than Hershey can make, at least right now.

Many consumer goods manufacturers have struggled to meet rising demand for their products during the pandemic, especially with ongoing supply chain issues. That means they have had to reduce production of certain less popular items or, as in the case of the great Choco Taco, eliminate them altogether.

Hershey is in the same boat.

The demand for candy increased during the pandemic and has remained high. Meanwhile, interest in Halloween has only grown stronger. That’s bittersweet news for Hershey, which has seen sales rise — the company reported double-digit sales growth in the quarter compared to last year — but has also had to make some production sacrifices.

The chocolate maker uses the same manufacturing lines for its regular and seasonal products. That means you can’t increase the production of regular candy and Halloween or holiday items. Instead, you have to do one thing or the other.

“We had a strategy of prioritizing shelf availability every day,” Buck said during an analyst call to discuss the company’s second-quarter results. “That was a choice we had to make,” he said. “It was a difficult decision.”

That likely means giving up ground to competitors like Mars Wrigley, which makes M&Ms, Snickers, Skittles and other candy, and Brach’s, during the busy Halloween season. Hershey is adding more manufacturing lines and hopes to keep up with demand in the coming years.

But he has other problems.

In addition to capacity constraints, the company is still struggling with disruptions throughout its supply chain, including higher dairy prices and ingredient shortages. To get the ingredients he needs, Hershey has to source them from other suppliers, which is expensive.

These problems are largely related to the war in Ukraine, Buck said.