The Ferrero candy empire, based in Alba, Italy and producers of Nutella, TicTac, Mon Cheri, and Kinder, was begun in 1923 when Pietro Ferrero opened a pastry shop in northwestern Italy, eventually settling in the hills of Alba and along the way formulating a chocolate alternative that sold very well, called “Supercrema” and, today, “Nutella.” And, the rest is history – the company expended throughout Europe between 1949 and 2012. Giovanni Ferrero inherited the $13 billion candy empire in 2015, immediately bought British chocolatier Thornton’s that year and continuing his acquisitions through to Nestle’s acquisition this year which gives him Butterfinger and BabyRuth.
Almost overwhelmed by his new roles as both CEO and board chairman during his first two years at the helm, Giovanni appointed the first-ever family outsider as CEO of the company in 2017. The Giovanni game plan is to make things very, very sweet for the company, by expanding 7.33% per year in order to double turnover in a decade. Thus, the need for acquisition of outside companies who have desirable product lines. After purchase of Thornton’s he also acquired the U.S. company Fannie May, as well as Ferrara, maker of Red Hots and Trolli gummies. And, in March, 2018, he purchased Nestle’s – which made him the third-largest confectioner in the world. There are those who see some failings built into Giovanni’s plans, among them the fact that he is just “buying his way to scale,” and that he’s “coming into the U.S. market just as consumers as turning away from sugary sweets and shifting to so-called ‘premium sweets and healthier foods.” Ferraro, however, has a comfortable margin of error, as the company generates more than $1 billion in profits each year, and even with the spending on acquisitions, has taken on very little debt. A few years ago, the company also purchased two of the world’s biggest hazelnut traders, thus solidifying availability of a prime ingredient of its Nutella, which is becoming increasingly popular in the U.S. market, as well as becoming the world’s largest supplier of hazelnuts. Thus, in just 3 generations from the first small shop in Italy the company has become a huge enterprise that sells goods in more than 160 countries and makes 365,000 tons of Nutella per years. And, to add humor to the ending of this sweet story, Giovanni Ferrero says of the success, “Well, it’s a promising start.” Here’s to continued sweetness in all our lives!