Tricia Kummerer, the owner of Billy’s Homemade Candies, is reluctant to raise prices for Easter.
However, her chocolate suppliers have quoted prices that are 70% higher than last year, leaving her with little choice.
Kummerer explained, “Unfortunately, I have to raise prices, even though I didn’t want to do it during Easter. I'm trying to absorb the cost for now, but after Easter, we'll have to increase our prices.”
The supplier from Belgium provides the chocolate used to coat the candies at Billy’s.
Kummerer emphasized, “Their chocolate is crucial to our product, and the higher prices are impacting what we can produce.”
Kummerer's situation is not uncommon in the industry.
Chocolate suppliers globally are facing significant increases in cocoa prices, with cocoa futures nearly doubling in price since the beginning of 2024, breaking a previous record set in 1977, according to USA Today.
The spike in prices is attributed to a struggling cocoa crop, which has been harmed by heavy rains and unpredictable weather patterns from El Nino.
Approximately 70% of the world's cocoa is grown in West Africa, where the weather has been particularly severe, the Associated Press reported.
Initially, Kummerer's supplier indicated a 25 to 30% price increase on all chocolate, but the actual rise has been closer to 70%.
Kummerer suggested, “Based on what I've observed, the peak of the increase seems to have passed. New contracts will be released by the wholesaler in April, and it seems it will be around 50%, which is still significantly higher than what we were paying a few months ago.”
Billy’s continues to use the same distributor as before, but other wholesalers are facing similar challenges.
Last year, suppliers also raised prices by approximately 20% to 25%.
Kummerer noted, “Last year, there were instances when we couldn’t get the chocolate we needed. It seems like that's the case again this year. I've had two weeks where my delivery didn’t arrive as expected, and I had to personally pick it up after persuading the distributor to set some aside.”
Kummerer mentioned that the prices of the other ingredients used in the candies, such as butter, cream, and sugar, have remained relatively stable, and sales volumes have not changed significantly in recent years.
Nevertheless, she stated that the increasing cost of chocolate is creating pressure for the business.
Kummerer expressed, “I definitely don’t want to stop offering any products. I'm trying to make minimal changes while keeping the business running.”
Major chocolate producers have also been impacted by price increases. The Associated Press reported that the Hershey Co. raised chocolate prices last year and has committed to further increases to account for inflation.
Hershey’s net profit margins increased to 16.7% in 2023, up from 15.8% in 2022, as a result of passing on the cost of inflation to consumers, as reported by The Associated Press.
Local businesses like Billy’s, according to Kummerer, do not have the same resources as companies like Hershey, making them more vulnerable to sudden changes in supply prices.
Kummerer stated that the price increase impacts their small business much more severely as they do not have access to the same financial resources as larger companies.
Kummerer believes that the advantage of a small business lies in its tradition.
Kummerer highlighted that their business has maintained its traditional methods since 1935, emphasizing the use of handmade, quality ingredients, providing customers with a unique and authentic experience.
