Hershey is recasting its supply chain as a core source of competitive advantage as new chief executive Kirk Tanner reshapes the chocolate maker around a more integrated model for demand creation, commercial execution and fulfilment.
At its 2026 Investor Day in New York, the company said it now sees supply chain performance not as a back-office function but as one of the main drivers of growth, service and resilience. Tanner described “precision demand fulfilment” as a way t...
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o improve service levels, sharpen execution and get products to market faster.
The new structure splits the business into three linked parts: generating demand for brands, working with retail partners and then delivering goods with greater speed and accuracy. Hershey said the model is designed to support a “digital backbone” in which core systems are increasingly AI-enabled and capable of supporting real-time decisions.
Tanner argued that a stronger supply chain helps protect the qualities consumers value most, including taste, quality, affordability and broad availability. He said that combination is intended to reinforce a flywheel effect that can translate into more durable financial performance.
The company’s investor presentation came after Hershey announced the meeting in February and then used the March event to outline a broader strategy aimed at leading the next generation of snacking. That plan reaches beyond core confectionery into premium, better-for-you and functional products, while also expanding salty snacks.
Chief growth officer Stacy Taffet said the company is trying to build capabilities for “advantaged organic innovations”, as consumers increasingly look for healthier options that still deliver on taste. Hershey also linked the trend to changing eating habits associated with GLP-1 drugs, saying products such as reduced-sugar snacks, protein bars with fibre and time-release nutrients could play a larger role.
On sourcing, cocoa remains the most important raw material and one of the biggest pressure points in the business. Hershey said it is building longer-term relationships with farmers in Côte d’Ivoire as part of an effort to reduce vulnerability in a market that has been hit by extreme volatility.
The cocoa market surged after drought conditions in Ghana and Côte d’Ivoire tightened supply, pushing futures far above historical levels. Hershey disclosed $491.0 million in commodity hedging losses in its annual report, underlining how sharply raw material swings have affected the company.
Chief supply chain officer Jason Reiman said resilience now depends heavily on diversification. He noted that the West African giants that once supplied close to two-thirds of global cocoa output now account for less than half. Hershey’s procurement arm in Switzerland handles price risk management, physical sourcing and sustainable supply oversight.
Reiman said the company believes its traders, process discipline and technology give it an edge, pointing to internal analysis showing stronger long-term procurement performance than peers. Hershey has also been investing in market intelligence and hedging tools to improve visibility and response times.
That push for flexibility extends to manufacturing. Hershey operates 15 plants across its network, mostly in North America, with facilities in the United States, Mexico and Malaysia. The company said its production system is being tuned for a business that is still heavily dependent on North America but is also trying to support international growth.
In recent years, Hershey has added capacity through a new chocolate processing plant in Pennsylvania, purchases in popcorn production and a wider investment programme that includes new lines and upgrades to existing ones. The company said some of its factories can switch between categories, giving it more room to respond to demand changes.
The salty snacks business is one area where Hershey expects faster growth than in core chocolate, and the company said it has been increasing internal manufacturing capacity to support that expansion. Five years ago, the category depended entirely on outside partners; now Hershey says it makes more than 80% of those products itself.
Executives also acknowledged the complexity created by a large number of stock-keeping units. Andrew Archambault, president of Hershey North America, said the company wants each item on shelf to have a clear purpose and occasion, so the portfolio can be managed at scale without unnecessary clutter.
Technology is central to that effort. Reiman said nothing in supply chain moves forward without it, and Hershey has deployed digital tools across sourcing, manufacturing, fulfilment and planning. In procurement, it has added spend visibility and should-cost modelling. On the factory floor, it has rolled out connected-worker systems that surface inefficiencies and root causes in real time.
For distribution, Hershey is using store-level assortment tools that tailor displays and product mixes to local data and sales input. Above that sits a decision-intelligence layer from Aera Technology that connects information from different systems and triggers automated responses, such as expediting packaging materials when production moves faster than expected.
Reiman said that approach could lift productivity by $50 million and cut inventory by $100 million over the next two years. For Hershey, the bet is that a more intelligent, more tightly managed supply chain will do more than keep factories and trucks moving: it will help define the next phase of the business itself.
Source: Noah Wire Services
