Wednesday, March 14, 2007

Hershey: the end of an era approaches

There was a small item in the Wall Street Journal today mentioning that the Hershey Company, among others, might be interested in purchasing the confectionary business of Cadbury Schweppes. Perhaps you didn't notice that. But you don't live where I do.

Our house is a few miles from the self-proclaimed "sweetest place on Earth"--Hershey, Pennsylvania. Here, Hershey is more than a company, more even than a large local employer. It is the pre-eminent industrial symbol of the area. The Hershey name graces the town (the company came first), a gigantic amusement park close enough to the factory for guests to smell the cocoa, two hotels, a minor-league hockey team, several schools, and the largest teaching hospital within 100 miles. Main Street is called Chocolate Avenue.

It's quaint, really, and, like most things quaint, its days are numbered. The early warning sign occurred in 2002, when the company put itself up for sale. A huge local backlash rose up and quashed that idea. But the changes in the offing for Hershey were just beginning.

Last month, Hershey announced that it would reduce employment by 1500 people and open a large plant in Mexico. The Harrisburg Patriot-News reported that staff members had been told the toll could be 3000 workers. The catalog-fulfillment side of the business is being outsourced to Philadephia and Illinois.

And the purchase of a company like Cadbury wouldn't be just a purchase. Cadbury is larger than Hershey, and more global. Any such combination would mean more production shifting, right-sizing, and the like. There's no way Hershey would still be Hershey the way we know it here, today.

Someday, I'll tell my grandkids about the time we lived near a company town, and they will say to me in response, "What's that?"

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(Photo from the Hershey web site)