Resource Availability: The Candy Industry
Resource Availability: The Candy Industry
Critical Resources
The most important critical resources in for the candy industry are cocoa, sugar, corn sweeteners, coal, natural gas, and fuel oil. These are all very important ingredients that companies will use to produce the candy. It is very clear that in order to produce candy, you will need to include these materials.
Availability of the Critical Resources
Important materials like sugar and corn syrup are readily available from many sources. These materials are very common in all types of food, so there needs to be an abundance of these items. The quality, availability, and price of cacao beans vary according to conditions in the major growing countries of West Africa and South America.
Trends in the Availability of These Sources
Non-chocolate confectionery products are made in various ways. Hard candies are a mixture of sugars and flavorings, which are then boiled and poured into molds to harden. Cacao beans may be bought through import brokers or on commodity exchanges like the New York Board of Trade. As Jon Cox said, “Of course growth is going to be slower next year, but I can think of few other places to hide out in terms of an investment during a global recession”
Impact Resource Availability Will Have on the Industry in the Near and Long Term
Energy is an important input for most candy manufacture, required for roasting, liquefying, or cooking. Companies try to minimize the impact of price in fluctuations in raw materials and energy costs by forward purchasing and hedging. This is used extensively in supply chain management. Inclusive information systems can help candy manufacturers structure plans between customers and suppliers. Good supply chain management helps improve forecasting, reduce inventory, and increase overall efficiency (Hoover, 2009).