With High Shipping Costs, Online Shopping Is Not Big Business For Chocolate Makers

Image courtesy of (Eric BEAUME)

Sure, shopping from the comfort of your couch can be an easy, convenient alternative to schlepping to the mall or grocery store. But there are just some things that might not be worth the trouble to have shipped. Case in point: chocolate. The sweet treat can be a real pain to transport, for both the company and customer. 

The Wall Street Journal reports that chocolate makers are having a difficult time finding balance when it comes to ensuring their product arrives in perfect condition and the mounting costs to actually ship the goods.

Companies like Hershey and Mars usually employ refrigerated trucks to ship pallets of their products to retailers, ensuring the chocolatey cargo doesn’t melt or “bloom” — the white film that covers the treats when sugar and fat rise to the surface.

But that type of shipping isn’t exactly economical when a customer orders a single box of chocolates for Valentine’s Day online.

The WSJ reports that keeping such a small shipment cool often costs more than the chocolate itself. For example, a $4.25 bag of Hershey Kisses has a shipping cost of $6.95.

But that’s not the only shipping related cost customers might encounter when shopping their favorite chocolate maker online. Hershey also “strongly suggests” that customers buy liquid ice packs and a foam cooler for another $4.99. All together that $4.25 bag of chocolate now costs you about $20.20, and that’s without figuring in taxes.

These high costs, and other logistical issues, have many chocolate makers looking for ways to revamp and streamline their shipping options.

Hershey’s recently hosted a competition in which people competed to design the lightest, most-affordable packaging to keep its goods from melting for at least 48 hours. The company hasn’t announced a winner for the $25,000 prize yet.

“We were talking about it, and our e-commerce team said, ‘We need to find a better solution,’” Eric Zampedri, a packaging engineer in Hershey’s research and development office, tells the WSJ. “If we can reduce the cost for us, we can reduce it for consumers too.”

For now, the company continues to ship its products from distribution centers using parcel carriers, packing on sometimes two to three pounds of ice to keep each five-pound box of chocolate cool, Zampedri says.

The WSJ reports that it’s not just large chocolate companies that are struggling with shipping their goods directly to consumers; smaller, speciality chocolatiers are also looking for ways to decrease shipping costs.

Vosges Haut-Chocolat, a Chicago company that sells truffles and chocolate bars, tells the WSJ that it loses money on most cold shipments to consumers. Yet, it can’t discontinue the service, as online sales made up 20% of the company’s $26 million in revenue last year.

To help offset the costs, the company includes a $10 shipping surcharge to cover cool shipping on customer orders. In order to decrease the costs passed on to customers, the company is looking to use a combination of gel packs and ice pack.

“The biggest hurdle is…maintaining that balance of what the customer is willing to pay for, and how to ship it to them in the best condition possible,” Zach Jarosz, Vosges’s supply-chain planning manager, says.

High Cost of Keeping Chocolate Cool Tempers Online Sales [The Wall Street Journal]