Table of Contents
- 1 User Association Example
- 2 No contractions yet
- 3 Many reasons
- 4 Other things are also more expensive
- 5 People do not allow themselves to be removed from letters
- 6 The next year the price is even higher
- 7 Shipping letters are not smaller
- 8 How have rising raw material costs impacted the pricing strategy for chocolate letters?
Scheres Puck Door·59 minutes ago·Modified: 59 minutes ago
RTL
To fill all the shoes that are placed with chocolate letters, Sinterklaas has to spend a lot of money. The desserts cost an average of 25 percent more than last year. And the end of the price hike is not yet in sight.
“It applies to a maximum of a few euros per letter,” said Sebastiaan Schreijen, senior Food & Agribusiness analyst at RaboResearch. “On average, the selling price per kilo of chocolate letters this year is about 20 to 25 percent higher than last year.”
“The price difference between one brand and another varies a lot,” says Schreijen. “Some letters are increased in price by eight percent, others up to 35 to 40 percent.”
User Association Example
The Consumers’ Association also monitors price increases, even though they have not carried out any ‘extensive research’. “But if I take a sample of five different brands of milk chocolate letters, it turns out that they have all increased in price,” said spokesman Gerard Spierenburg.
A letter from Jumbo’s own brand is 35 percent more expensive. The price of Albert Heijn has increased by thirteen percent. Kruidvat (+25 percent) and Plus (+7 percent) have to pay more. “Tony Chocolonely is also more expensive,” says Spierenburg.
No contractions yet
According to experts, there is no decline. In that case, the price of the letter is still about the same, but it is less.
The average Dutch person eats around 4.8 kilos of chocolate candy every year. Not only are the chocolate letters more expensive, but just about everything that contains cocoa. “In the supermarket, the average kilo price for chocolate is almost 40 percent higher than it was at the beginning of 2021,” says Schreijen.
© RTL News“We buy our cocoa well in advance and we have been seeing an increase in prices for a year. The price has increased significantly to $10,000 for 1,000 kilos and now the price is around $6,000,” says Dennis Teeken, director of the Verkade market. He does not expect the price to return to previous level.
Verkade sells 2.5 million chocolate bars each year. Their milk letter contains 36 percent cocoa and the pure letter contains 54 percent.
Many reasons
One reason for the large increase in prices is the failed harvest in Africa. About 70 percent of all cocoa comes from Ivory Coast and Ghana. The cocoa harvest is disappointing for the third year in a row.
This is due to bad weather, but also to old cocoa trees and tree diseases, which means that less cocoa beans can be produced.
Other things are also more expensive
It is expected that this problem will not disappear quickly, leading to fears of shortages. And that increases the price of cocoa higher.
In addition, the price of sugar, milk, energy, transport and packaging materials has also increased and this is all passed on in the price of your chocolate product.
People do not allow themselves to be removed from letters
Despite a significant increase in prices, sales volume for chocolate letters has not fallen, notes the Dutch trade association for companies in biscuits, candy, chocolate, snacks and nuts (VBZ ).
“Consumers are waiting for an offer. Or they choose a cheaper letter from a discounter or a private label. People won’t let their chocolate letter go because of the inflated price,” said Jeroen of Bruin from VBZ.
According to the trade association, there is also a group of consumers who have a greater need for luxury and are willing to pay ten euros for a luxury letter. “They choose an A brand such as Verkade or luxury handmade chocolate letters. These are given as a gift,” says De Bruin.
The next year the price is even higher
Sinterklaas and chocolate lovers should hold their breath as experts expect the price to be even higher next year.
There are long-term price agreements between cocoa processors, chocolate makers and supermarkets, which means there is a lag of eight to twelve months between raw material prices and what the consumer pays at finally in the store.
Shipping letters are not smaller
RaboResearch expects that chocolate producers will try to reduce the price increases by offering smaller packaging or by using less cocoa in the products.
Teeken says that Verkadeletters is not getting smaller, but the company fears that the price will increase by 30 to 40 percent next year.
See our report on Dubai’s famous bar below.
2024-11-18 05:52:00
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How have rising raw material costs impacted the pricing strategy for chocolate letters?
1. How have the increasing prices of cocoa, sugar, milk, energy, and packaging materials affected the cost of producing chocolate letters?
2. What factors contributed to the failed cocoa harvest in Africa, and what impact is this having on global cocoa production and pricing?
3. How have consumers in the Netherlands responded to the higher prices of chocolate letters? Have they cut back on their purchases or opted for cheaper alternatives?
4. Do you think an increase in luxury chocolate letter sales indicates that consumers are willing to pay more for quality and unique products, or are they simply unable to find affordable options elsewhere?
5. Have chocolate producers considered reducing the size of chocolate letters to combat rising costs, and would this be an effective strategy in the long run?
6. How do you think these price increases will affect other chocolate-related products, such as candy bars and other confections?
7. What do you think can be done to address the issues surrounding the cocoa harvest and stabilize cocoa prices in the future?
