Hershey Creamery Company
Encyclopedia
Hershey Creamery Company, also known as Hershey's Ice Cream, is a creamery
that produces Hershey's brand ice cream
, sorbet, sherbet, and frozen yogurt
, and other frozen treats such as smoothie
s and frozen slab
style ice cream mixers. Founded by Jacob Hershey and four of his brothers in 1894—no relation to the founding family of The Hershey Company
—it was taken over by the Holder family in the 1920s. The company was one of the first to offer consumers pre-packaged ice cream pints. In 1998, it modernized its operations to increase efficiency and reduce overhead. With their shared names and cities of origin, Hershey Creamery and Hershey Company have had a tumultuous relationship marked by multiple lawsuits over trademark issues. In the mid-1990s, the companies settled their most recent legal battles out of court, with the creamery agreeing to add a disclaimer
to its ice cream products to note that it is not related to Hershey Company.
The family-owned business has approximately 450 employees and operates 22 distribution centers in 28 states across the Eastern and Northeastern United States. It is a publicly traded company, with its stocks listed only on Pink Sheets
as the company offers a limited number of shares to potential shareholders. In 2001, the company posted a profit of $4.1 million with sales reaching $91.4 million.
farmhouse. The ice cream was packed in metal-lined wooden containers that the Hershey brothers designed and built. The containers were loaded into trucks with ice packed around them to keep the ice cream fresh and cold. Salesmen traveled daily routes to deliver product to customers in the county and in surrounding areas.
In the 1920s, the company was merged with the Holder family's Bethlehem
-based Meyer Dairy Company, retaining the Hershey name. In 1926, with demand for the ice cream exceeding the capacity of the farmhouse, the newly merged company constructed its first ice cream plant in Harrisburg, Pennsylvania
. During the Great Depression
, the company became the first ice cream maker to offer its products in pre-packaged pints. It began creating new flavors of ice cream, such as Moose Tracks, which it then sold to other ice cream makers. Following World War II
, the company continued to answer the call for greater convenience in consumer foods and expanded its offerings to include single-serve, easy to eat items such as popsicle
s and ice cream sandwich
es. In the 1960s, the Holder family assumed full ownership of the company.
As the company grew, it split its production operations, with the Harrisburg location mixing the ice cream and a new facility in Lower Swatara Township
used for the actual hardening and packaging of the product. While local orders continued to be delivered in small Hershey's Ice Cream refrigerated trucks, the company shifted to transporting most of its ice cream to refrigerated tractor trailer trucks, enabling it to stretch its market beyond the state of Pennsylvania. It expanded its distribution facilities, eventually occupying 22 co-owned distribution center
s. This enabled the company to ship products out more quickly after orders are received and resulted in less travel time for the products, ensuring freshness and quality were maintained. In the summer months, the company greatly increased its workforce and leased additional cold-storage space to help meet the seasonal orders, as the orders were prepared by hand. In 1998, operations were modernized and automated when the company purchased 105 acre (0.4249203 km²) in nearby Middletown
where it constructed a modern 1.3 million cubic foot warehouse, enabling it to boost its efficiency, reducing the need to increase its summer workforce, and reducing the frequent product loss caused by hand orders and inefficient packing systems. The modernization of its warehouse also improved inventory management, order accuracy, and has helped the company continue its growth.
by Milton S. Hershey
—no relation to the founding Hershey brothers. The first troubles came after the Hershey Creamery began producing chocolate candy and cocoa. Milton S. Hershey learned of the candies in 1919, and assigned Charles Ziegler to "find instances of confusion and infringement and of unfair competition". Ziegler found that in addition to making similar products, the packaging used on the chocolates resembled that used by Hershey Company—then called Hershey Chocolate. Investigating complaints from retailers in Boston, New York, Binghamtom, Norfolk, and Richmond, Ziegler reportedly found that retailers were confusing the two products, and sometimes deliberately replacing the higher priced Hershey Company products with the Hershey Creamery products. In Harrisburg, Ziegler found a display of Hershey Creamery "Hershey Kisses", which were bite-sized chocolate drops similar to the chocolate company's creations. After cease and desist
letters failed to resolve the problem, Milton Hershey filed suit in 1921 in the United States District Court for the Middle District of Pennsylvania
for trademark infringement
. In 1926, a district judged partially sided with Hershey Chocolate and prohibited the creamery from using the name Hershey's in connection with "manufacture, advertisement, distribution, or sale of, among other things, chocolate, cocoa, chocolate confections, and chocolate or cocoa products". With the naming dispute seemingly settled, Hershey Company allowed Hershey Creamery to operate a soda fountain
at its famous Hersheypark
from 1930 to 1935. During its tenure, the creamery spot was a popular park destination, with guests frequenting the spot during intermissions and after the ballroom dances.
In 1958, the creamery registered for and was granted the "Hershey's" trademark for use with ice cream and butter products. Seven years later, the company filed suit in United States District Court for the Southern District of New York
against Hershey Company and Consolidated Foods Corporation after learning the companies were planning to partner to make a line of Hershey's branded ice cream bars. Hershey Creamery alleged "trademark infringement, unfair competition, false designation of origin, false descriptions, and false representations", to which Hershey Chocolate responded with a counterclaim
questioning the validity of the trademark, claiming it was fraudulently obtained. The companies settled out of court the following year, with the creamery agreeing to drop "butter" from its trademark and fix a filing error with it, and allowing Hershey Company to release the licensed bars within certain guidelines. Hershey Company also agreed not to challenge the creamery's "Hershey's" trademark for use on ice cream again.
Shortly after this, Hershey Creamery expanded its trademark to include other ice cream products: "ice cream, ice milk, sherbet, water ice, and frozen confections in which ice cream, ice milk, sherbet or water ice is a component". In 1989, the creamery expanded its products to include frozen yogurt
and filed for a new trademark for this new line of products. Upon learning of the registration request, the Hershey Company—then named Hershey Foods—demanded the company cease production of the products claiming it violated Hershey Company's trademarks. The creamery dropped its application, but continued releasing the products, so in May 1990, Hershey Company filed suit in the Middle District court of Pennsylvania seeking a legal injunction to stop Hershey Creamery from producing and marketing its Hershey's branded frozen yogurt, as well as to attempt to stop the company from using the "Hershey's" trademark outside of its "traditional thirteen-state trading area" and to demand that the company include a disclaimer disavowing its relation to Hershey Company on all of its products. Hershey Creamery counter sued in the New York South District court, concerned that Hershey Company demands reneged on the 1967 settlement, and requested the Pennsylvania court actions be transferred to the New York court as that was where the settlement was originally handled. The request was denied and the court instead blocked the Hershey Creamery's suit in New York. The Creamery appealed but this was denied.
After three years in court, the two companies again settled, with Hershey's Creamery agreeing to put a disclaimer on all of its products, corporate website, and in promotional materials and press releases. On their website, the disclaimer simply notes "not affiliated with Hershey's Chocolate".
.
of manufacturing and vice president
of sales and marketing, respectively. The company has approximately 450 employees.
The company operates 22 distribution centers, which serve some 22,000 clients in 28 states across the eastern United States, with Florida, Illinois, and the Carolinas being its newest market areas after its 2005 expansion. Since 1996, management has focused on the company's main distribution center rather than expansion outside of existing footprint. In 2003, it shifted its focus to moving its operations from the Harrisburg area, which is flood-prone and landlocked, to the Lower Swatara area. It opened a distribution center there in 1998, and plans to shift its headquarters and production facilities there over the next five to ten years. Unlike other ice cream makers, Hershey Creamery maintains ownership over its delivery trucks, distribution centers and warehouses, a practice the Holder family feels is important to maintaining the traditions of the "private, conservative" company.
Sales are primarily derived from branded ice cream parlors, quick-serve restaurants, and the distribution of its pre-packaged items to convenience store
s, food service operators such as schools, hospitals, prisons, military installations, sports stadium
s, amusement park
s, and assisted living centers. Pre-packaged items are also sold in regional supermarkets, but this accounts for a minority of the company's sales.
traded company, with only 36,000 shares available, which are listed on Pink Sheets and sold via the over-the-counter market. The company has fewer than 500 shareholders, primarily among the Holder family. Its stocks are considered to be "thinly traded" in that its shares are rarely traded, and then only a few shares are sold at a time. In 2006, the company maintained a 6.2 to 1 price-to-earnings ratio
with no long-term debt and shareholders receive quarterly dividends and special dividend
s.
In 1936, the company shares traded at $2.01 per share. The value of the stock continued to grow steadily and by 1996, shares were trading at $2,300 per share; and hitting as high as $3,600 a share in 2003. Though not required to provide U.S. Securities and Exchange Commission (SEC) filings, the company does distribute similar-style reports to its shareholders annually, and in the 1930s and 40s, its annual earnings were reported in the Christian Science Monitor. In 1936, the company reported an net income of $195,077, up nearly $10,000 from its 1935 earnings of $185,320. As the company grew, so did its earnings. In 2001, the company reported sales of $91.4 million, giving it an net profit of $4.6 million. Sales began declining, and by 2007, they were down to $44,800,000.
Hershey Creamery ranked #90 in Dairy Foods magazine's 2005 list of the top 100 dairy
companies, which ranks dairy companies based on annual sales. This was one rank higher than its 2004 rank of 91st.
, with 31 of those varieties marked as super premium gold rim products and 4 available in sugar-free varieties that use the alternate sweetening product Splenda
. Additionally, it offers two flavors of sorbet, three flavors of sherbet
, and eight flavors of frozen yogurt
. For pre-packaged half-gallons, the company offers consumers 32 ice cream flavors, including 4 no-fat varieties of its basic flavors and five sherbet flavors. In pints, it offers 13 flavors in its traditional square packaging and 15 flavors in its newer round pint packaging, including 2 limited edition and 2 no-sugar added varieties. It also offers three basic pre-made ice cream cake
s.
In addition to these traditional ice cream treats, Hershey Creamery offers a variety of novelty ice cream treats, including ice cream sandwich
es, popsicle
s, sundae
cups, ice cream sticks, squeeze ups, and pre-made cones. It also distributes smoothie
s under its "Tropi-Kool Smoothies" brand and frozen slab
ice cream under its "Creation Station" brand.
In January 2007, the company became one of the first companies to offer a frozen energy drink
: Banzai Energy Ice, which it created with using the then popular energy drink Banzai
. Though the 4-ounce product received good reviews for its citrus flavor and convenient squeeze-up container for on-the-go consumer, the product was a financial failure and was dropped.
Creamery
In a dairy, the creamery is the location of cream processing. Cream is separated from whole milk; pasteurization is done to the skimmed milk and cream separately. Whole milk for sale has had some cream returned to the skimmed milk....
that produces Hershey's brand ice cream
Ice cream
Ice cream is a frozen dessert usually made from dairy products, such as milk and cream, and often combined with fruits or other ingredients and flavours. Most varieties contain sugar, although some are made with other sweeteners...
, sorbet, sherbet, and frozen yogurt
Frozen yogurt
Frozen yogurt is a frozen dessert containing yogurt or other dairy products. It is slightly more tart than ice cream, as well as lower in fat...
, and other frozen treats such as smoothie
Smoothie
A smoothie is a blended and sometimes sweetened beverage made from fresh fruit and in special cases can contain chocolate or peanut butter. In addition to fruit, many smoothies include crushed ice, frozen fruit, honey or contain syrup and ice ingredients...
s and frozen slab
Mix-in
A mix-in is a term used to describe a dessert made of ice cream and another flavoring such as candy. Mix-in desserts are traditionally sold in an ice cream parlor and are made at the time of ordering...
style ice cream mixers. Founded by Jacob Hershey and four of his brothers in 1894—no relation to the founding family of The Hershey Company
The Hershey Company
The Hershey Company, known until April 2005 as the Hershey Foods Corporation and commonly called Hershey's, is the largest chocolate manufacturer in North America. Its headquarters are in Hershey, Pennsylvania, which is also home to Hershey's Chocolate World. It was founded by Milton S...
—it was taken over by the Holder family in the 1920s. The company was one of the first to offer consumers pre-packaged ice cream pints. In 1998, it modernized its operations to increase efficiency and reduce overhead. With their shared names and cities of origin, Hershey Creamery and Hershey Company have had a tumultuous relationship marked by multiple lawsuits over trademark issues. In the mid-1990s, the companies settled their most recent legal battles out of court, with the creamery agreeing to add a disclaimer
Disclaimer
A disclaimer is generally any statement intended to specify or delimit the scope of rights and obligations that may be exercised and enforced by parties in a legally recognized relationship...
to its ice cream products to note that it is not related to Hershey Company.
The family-owned business has approximately 450 employees and operates 22 distribution centers in 28 states across the Eastern and Northeastern United States. It is a publicly traded company, with its stocks listed only on Pink Sheets
Pink Sheets
OTC Markets Group, Inc., informally known as "Pink Sheets", is a private company that provides services to the U.S. over-the-counter securities market including electronic quotations, trading, messaging, and information platforms. According to the U.S. Securities and Exchange Commission, OTC...
as the company offers a limited number of shares to potential shareholders. In 2001, the company posted a profit of $4.1 million with sales reaching $91.4 million.
History
The Hershey brothers, Jacob, Isaac, John, Paris, and Eli, founded Hershey Creamery Company in 1894, with the company originally operating out of the Hershey family's Lancaster CountyLancaster County, Pennsylvania
Lancaster County, known as the Garden Spot of America or Pennsylvania Dutch Country, is a county located in the southeastern part of the Commonwealth of Pennsylvania, in the United States. As of 2010 the population was 519,445. Lancaster County forms the Lancaster Metropolitan Statistical Area, the...
farmhouse. The ice cream was packed in metal-lined wooden containers that the Hershey brothers designed and built. The containers were loaded into trucks with ice packed around them to keep the ice cream fresh and cold. Salesmen traveled daily routes to deliver product to customers in the county and in surrounding areas.
In the 1920s, the company was merged with the Holder family's Bethlehem
Bethlehem, Pennsylvania
Bethlehem is a city in Lehigh and Northampton Counties in the Lehigh Valley region of eastern Pennsylvania, in the United States. As of the 2010 census, the city had a total population of 74,982, making it the seventh largest city in Pennsylvania, after Philadelphia, Pittsburgh, Allentown, Erie,...
-based Meyer Dairy Company, retaining the Hershey name. In 1926, with demand for the ice cream exceeding the capacity of the farmhouse, the newly merged company constructed its first ice cream plant in Harrisburg, Pennsylvania
Harrisburg, Pennsylvania
Harrisburg is the capital of Pennsylvania. As of the 2010 census, the city had a population of 49,528, making it the ninth largest city in Pennsylvania...
. During the Great Depression
Great Depression
The Great Depression was a severe worldwide economic depression in the decade preceding World War II. The timing of the Great Depression varied across nations, but in most countries it started in about 1929 and lasted until the late 1930s or early 1940s...
, the company became the first ice cream maker to offer its products in pre-packaged pints. It began creating new flavors of ice cream, such as Moose Tracks, which it then sold to other ice cream makers. Following World War II
World War II
World War II, or the Second World War , was a global conflict lasting from 1939 to 1945, involving most of the world's nations—including all of the great powers—eventually forming two opposing military alliances: the Allies and the Axis...
, the company continued to answer the call for greater convenience in consumer foods and expanded its offerings to include single-serve, easy to eat items such as popsicle
Popsicle
Popsicle is the most popular brand of ice pop in the United States and Canada. The first ice pop was created by accident in 1905 when 11-year-old Frank Epperson left a cup of soda on his porch in cold weather overnight. The next morning he went to go get the soda and it was frozen, so he put two...
s and ice cream sandwich
Ice cream sandwich
An ice cream sandwich is a frozen confection composed of a layer of ice cream, usually vanilla , "sandwiched" between two biscuits/cookies or slices of cake, usually chocolate.-Australia:...
es. In the 1960s, the Holder family assumed full ownership of the company.
As the company grew, it split its production operations, with the Harrisburg location mixing the ice cream and a new facility in Lower Swatara Township
Lower Swatara Township, Pennsylvania
Lower Swatara Township is a township in Dauphin County, Pennsylvania, United States. The population was 8,149 at the 2000 census. Harrisburg International Airport and Penn State Harrisburg are located within the township.-History:...
used for the actual hardening and packaging of the product. While local orders continued to be delivered in small Hershey's Ice Cream refrigerated trucks, the company shifted to transporting most of its ice cream to refrigerated tractor trailer trucks, enabling it to stretch its market beyond the state of Pennsylvania. It expanded its distribution facilities, eventually occupying 22 co-owned distribution center
Distribution center
A distribution center for a set of products is a warehouse or other specialized building, often with refrigeration or air conditioning, which is stocked with products to be redistributed to retailers, to wholesalers, or directly to consumers. A distribution center is a principal part, the order...
s. This enabled the company to ship products out more quickly after orders are received and resulted in less travel time for the products, ensuring freshness and quality were maintained. In the summer months, the company greatly increased its workforce and leased additional cold-storage space to help meet the seasonal orders, as the orders were prepared by hand. In 1998, operations were modernized and automated when the company purchased 105 acre (0.4249203 km²) in nearby Middletown
Middletown, Dauphin County, Pennsylvania
Middletown is a borough in Dauphin County, Pennsylvania, on the Susquehanna River, nine miles southeast of Harrisburg. It is part of the Harrisburg–Carlisle Metropolitan Statistical Area.-History:...
where it constructed a modern 1.3 million cubic foot warehouse, enabling it to boost its efficiency, reducing the need to increase its summer workforce, and reducing the frequent product loss caused by hand orders and inefficient packing systems. The modernization of its warehouse also improved inventory management, order accuracy, and has helped the company continue its growth.
Trademark disputes with Hershey Company
Hershey Creamery has been involved in multiple legal disputes with the similarly named Hershey Company, founded around the same time in LancasterLancaster, Pennsylvania
Lancaster is a city in the south-central part of the Commonwealth of Pennsylvania. It is the county seat of Lancaster County and one of the older inland cities in the United States, . With a population of 59,322, it ranks eighth in population among Pennsylvania's cities...
by Milton S. Hershey
Milton S. Hershey
Milton Snavely Hershey was an American confectioner, philanthropist, and founder of The Hershey Chocolate Company and the "company town" of Hershey, Pennsylvania....
—no relation to the founding Hershey brothers. The first troubles came after the Hershey Creamery began producing chocolate candy and cocoa. Milton S. Hershey learned of the candies in 1919, and assigned Charles Ziegler to "find instances of confusion and infringement and of unfair competition". Ziegler found that in addition to making similar products, the packaging used on the chocolates resembled that used by Hershey Company—then called Hershey Chocolate. Investigating complaints from retailers in Boston, New York, Binghamtom, Norfolk, and Richmond, Ziegler reportedly found that retailers were confusing the two products, and sometimes deliberately replacing the higher priced Hershey Company products with the Hershey Creamery products. In Harrisburg, Ziegler found a display of Hershey Creamery "Hershey Kisses", which were bite-sized chocolate drops similar to the chocolate company's creations. After cease and desist
Cease and desist
A cease and desist is an order or request to halt an activity and not to take it up again later or else face legal action. The recipient of the cease-and-desist may be an individual or an organization....
letters failed to resolve the problem, Milton Hershey filed suit in 1921 in the United States District Court for the Middle District of Pennsylvania
United States District Court for the Middle District of Pennsylvania
The United States District Court for the Middle District of Pennsylvania is district level federal court with jurisdiction over approximately one half of Pennsylvania...
for trademark infringement
Trademark infringement
Trademark infringement is a violation of the exclusive rights attaching to a trademark without the authorization of the trademark owner or any licensees...
. In 1926, a district judged partially sided with Hershey Chocolate and prohibited the creamery from using the name Hershey's in connection with "manufacture, advertisement, distribution, or sale of, among other things, chocolate, cocoa, chocolate confections, and chocolate or cocoa products". With the naming dispute seemingly settled, Hershey Company allowed Hershey Creamery to operate a soda fountain
Soda fountain
A soda fountain is a device that dispenses carbonated drinks. They can be found in restaurants, concession stands and other locations such as convenience stores...
at its famous Hersheypark
Hersheypark
Hersheypark is an amusement park located in Hershey, Pennsylvania, near the Hershey Chocolate Factory.Hersheypark was opened on April 24, 1907 as a leisure park for the employees of the Hershey Chocolate Company, an American confectionery company. Later, the company decided to open the park to the...
from 1930 to 1935. During its tenure, the creamery spot was a popular park destination, with guests frequenting the spot during intermissions and after the ballroom dances.
In 1958, the creamery registered for and was granted the "Hershey's" trademark for use with ice cream and butter products. Seven years later, the company filed suit in United States District Court for the Southern District of New York
United States District Court for the Southern District of New York
The United States District Court for the Southern District of New York is a federal district court. Appeals from the Southern District of New York are taken to the United States Court of Appeals for the Second Circuit The United States District Court for the Southern District of New York (in case...
against Hershey Company and Consolidated Foods Corporation after learning the companies were planning to partner to make a line of Hershey's branded ice cream bars. Hershey Creamery alleged "trademark infringement, unfair competition, false designation of origin, false descriptions, and false representations", to which Hershey Chocolate responded with a counterclaim
Counterclaim
In civil procedure, a party's claim is a counterclaim if the defending party has previously made a claim against the claiming party.Examples of counterclaims include:...
questioning the validity of the trademark, claiming it was fraudulently obtained. The companies settled out of court the following year, with the creamery agreeing to drop "butter" from its trademark and fix a filing error with it, and allowing Hershey Company to release the licensed bars within certain guidelines. Hershey Company also agreed not to challenge the creamery's "Hershey's" trademark for use on ice cream again.
Shortly after this, Hershey Creamery expanded its trademark to include other ice cream products: "ice cream, ice milk, sherbet, water ice, and frozen confections in which ice cream, ice milk, sherbet or water ice is a component". In 1989, the creamery expanded its products to include frozen yogurt
Frozen yogurt
Frozen yogurt is a frozen dessert containing yogurt or other dairy products. It is slightly more tart than ice cream, as well as lower in fat...
and filed for a new trademark for this new line of products. Upon learning of the registration request, the Hershey Company—then named Hershey Foods—demanded the company cease production of the products claiming it violated Hershey Company's trademarks. The creamery dropped its application, but continued releasing the products, so in May 1990, Hershey Company filed suit in the Middle District court of Pennsylvania seeking a legal injunction to stop Hershey Creamery from producing and marketing its Hershey's branded frozen yogurt, as well as to attempt to stop the company from using the "Hershey's" trademark outside of its "traditional thirteen-state trading area" and to demand that the company include a disclaimer disavowing its relation to Hershey Company on all of its products. Hershey Creamery counter sued in the New York South District court, concerned that Hershey Company demands reneged on the 1967 settlement, and requested the Pennsylvania court actions be transferred to the New York court as that was where the settlement was originally handled. The request was denied and the court instead blocked the Hershey Creamery's suit in New York. The Creamery appealed but this was denied.
After three years in court, the two companies again settled, with Hershey's Creamery agreeing to put a disclaimer on all of its products, corporate website, and in promotional materials and press releases. On their website, the disclaimer simply notes "not affiliated with Hershey's Chocolate".
Other legal issues
In November 2008, Hershey Creamery Company became the first company in the nation to be prosecuted and fined for failing to a Risk Management Program (RMP) as required by the Clean Air Act. The charges were brought by the Environmental Protection Agency (EPA), which stated that the company failed to developed the required plans with regard to its storage and use of anhydrous ammonia, which is a regulated substance. In the charges, the EPA noted that the creamery twice certified that it had developed the RMP plan, once in 1999 and again in 2004. Later inspection showed that the certifications were false and on December 7, 2006, the EPA issued a civil compliance order against the company, ordering the company to come into compliance. Hershey Creamery complied and in April 2007 submitted the appropriate RMPs, which were confirmed to be in-place through subsequent inspection. The case was heard at the Federal Middle District court of Pennsylvania, with Hershey Creamery pleading guilty to the charges; it was subsequently fined $100,000 and given a year probationProbation
Probation literally means testing of behaviour or abilities. In a legal sense, an offender on probation is ordered to follow certain conditions set forth by the court, often under the supervision of a probation officer...
.
Business model
Hershey Creamery is a family operated business, with each new generation raised to assume roles within the company hierarchy upon graduation of high school. , George Holder is its president, while his younger brothers, Walter and Tom, are vice presidentVice president
A vice president is an officer in government or business who is below a president in rank. The name comes from the Latin vice meaning 'in place of'. In some countries, the vice president is called the deputy president...
of manufacturing and vice president
Vice president
A vice president is an officer in government or business who is below a president in rank. The name comes from the Latin vice meaning 'in place of'. In some countries, the vice president is called the deputy president...
of sales and marketing, respectively. The company has approximately 450 employees.
The company operates 22 distribution centers, which serve some 22,000 clients in 28 states across the eastern United States, with Florida, Illinois, and the Carolinas being its newest market areas after its 2005 expansion. Since 1996, management has focused on the company's main distribution center rather than expansion outside of existing footprint. In 2003, it shifted its focus to moving its operations from the Harrisburg area, which is flood-prone and landlocked, to the Lower Swatara area. It opened a distribution center there in 1998, and plans to shift its headquarters and production facilities there over the next five to ten years. Unlike other ice cream makers, Hershey Creamery maintains ownership over its delivery trucks, distribution centers and warehouses, a practice the Holder family feels is important to maintaining the traditions of the "private, conservative" company.
Sales are primarily derived from branded ice cream parlors, quick-serve restaurants, and the distribution of its pre-packaged items to convenience store
Convenience store
A convenience store, corner store, corner shop, commonly called a bodega in Spanish-speaking areas of the United States, is a small store or shop in a built up area that stocks a range of everyday items such as groceries, toiletries, alcoholic and soft drinks, and may also offer money order and...
s, food service operators such as schools, hospitals, prisons, military installations, sports stadium
Sports Stadium
Sports Stadium was an Irish television sport programme on Raidió Teilifís Éireann . Broadcast between 1973 and 1997, it was RTÉ's flagship sports programme and one of its longest-running shows....
s, amusement park
Amusement park
thumb|Cinderella Castle in [[Magic Kingdom]], [[Disney World]]Amusement and theme parks are terms for a group of entertainment attractions and rides and other events in a location for the enjoyment of large numbers of people...
s, and assisted living centers. Pre-packaged items are also sold in regional supermarkets, but this accounts for a minority of the company's sales.
Financials
Hershey Creamery Company is a publiclyPublic company
This is not the same as a Government-owned corporation.A public company or publicly traded company is a limited liability company that offers its securities for sale to the general public, typically through a stock exchange, or through market makers operating in over the counter markets...
traded company, with only 36,000 shares available, which are listed on Pink Sheets and sold via the over-the-counter market. The company has fewer than 500 shareholders, primarily among the Holder family. Its stocks are considered to be "thinly traded" in that its shares are rarely traded, and then only a few shares are sold at a time. In 2006, the company maintained a 6.2 to 1 price-to-earnings ratio
P/E ratio
The P/E ratio of a stock is a measure of the price paid for a share relative to the annual net income or profit earned by the firm per share...
with no long-term debt and shareholders receive quarterly dividends and special dividend
Special dividend
A special dividend is a payment made by a company to its shareholders that the company declares to be separate from the typical recurring dividend cycle, if any, for the company. Usually when a company raises its normal dividend, the investor expectation is that this marks a sustained increase...
s.
In 1936, the company shares traded at $2.01 per share. The value of the stock continued to grow steadily and by 1996, shares were trading at $2,300 per share; and hitting as high as $3,600 a share in 2003. Though not required to provide U.S. Securities and Exchange Commission (SEC) filings, the company does distribute similar-style reports to its shareholders annually, and in the 1930s and 40s, its annual earnings were reported in the Christian Science Monitor. In 1936, the company reported an net income of $195,077, up nearly $10,000 from its 1935 earnings of $185,320. As the company grew, so did its earnings. In 2001, the company reported sales of $91.4 million, giving it an net profit of $4.6 million. Sales began declining, and by 2007, they were down to $44,800,000.
Hershey Creamery ranked #90 in Dairy Foods magazine's 2005 list of the top 100 dairy
Dairy
A dairy is a business enterprise established for the harvesting of animal milk—mostly from cows or goats, but also from buffalo, sheep, horses or camels —for human consumption. A dairy is typically located on a dedicated dairy farm or section of a multi-purpose farm that is concerned...
companies, which ranks dairy companies based on annual sales. This was one rank higher than its 2004 rank of 91st.
Products
, Hershey Creamery Company offers 98 flavors of regular, hand-dipped premium ice creamIce cream
Ice cream is a frozen dessert usually made from dairy products, such as milk and cream, and often combined with fruits or other ingredients and flavours. Most varieties contain sugar, although some are made with other sweeteners...
, with 31 of those varieties marked as super premium gold rim products and 4 available in sugar-free varieties that use the alternate sweetening product Splenda
Splenda
Splenda is the commercial name and registered trade mark of a sucralose-based artificial sweetener derived from sugar, owned by the British company Tate & Lyle. Sucralose was discovered by Tate & Lyle and researchers at Queen Elizabeth College, University of London, in 1976...
. Additionally, it offers two flavors of sorbet, three flavors of sherbet
Sherbet
Sherbet may refer to:- Foodstuffs :* Sherbert , an effervescent drink or a fizzy powder sweet, chiefly UK* Sherbert, an American term for a frozen dessert like sorbet, but containing a small amount of dairy...
, and eight flavors of frozen yogurt
Frozen yogurt
Frozen yogurt is a frozen dessert containing yogurt or other dairy products. It is slightly more tart than ice cream, as well as lower in fat...
. For pre-packaged half-gallons, the company offers consumers 32 ice cream flavors, including 4 no-fat varieties of its basic flavors and five sherbet flavors. In pints, it offers 13 flavors in its traditional square packaging and 15 flavors in its newer round pint packaging, including 2 limited edition and 2 no-sugar added varieties. It also offers three basic pre-made ice cream cake
Ice cream cake
Ice cream cake is either ice cream in the shape of a cake or ice cream and cake layered together to make a single form. The idea of ice cream cake came from desserts composed of cream and cookies or cake called trifles, which first turned up in the Renaissance...
s.
In addition to these traditional ice cream treats, Hershey Creamery offers a variety of novelty ice cream treats, including ice cream sandwich
Ice cream sandwich
An ice cream sandwich is a frozen confection composed of a layer of ice cream, usually vanilla , "sandwiched" between two biscuits/cookies or slices of cake, usually chocolate.-Australia:...
es, popsicle
Popsicle
Popsicle is the most popular brand of ice pop in the United States and Canada. The first ice pop was created by accident in 1905 when 11-year-old Frank Epperson left a cup of soda on his porch in cold weather overnight. The next morning he went to go get the soda and it was frozen, so he put two...
s, sundae
Sundae
The sundae is an ice cream dessert. It typically consists of a scoop of ice cream topped with sauce or syrup, and in some cases other toppings including chopped nuts, sprinkles, whipped cream, or maraschino cherries.-History:...
cups, ice cream sticks, squeeze ups, and pre-made cones. It also distributes smoothie
Smoothie
A smoothie is a blended and sometimes sweetened beverage made from fresh fruit and in special cases can contain chocolate or peanut butter. In addition to fruit, many smoothies include crushed ice, frozen fruit, honey or contain syrup and ice ingredients...
s under its "Tropi-Kool Smoothies" brand and frozen slab
Mix-in
A mix-in is a term used to describe a dessert made of ice cream and another flavoring such as candy. Mix-in desserts are traditionally sold in an ice cream parlor and are made at the time of ordering...
ice cream under its "Creation Station" brand.
In January 2007, the company became one of the first companies to offer a frozen energy drink
Energy drink
Energy drinks are beverages whose producers advertise that they "boost energy." These advertisements usually do not emphasize energy derived from the sugar and caffeine they contain but rather increased energy release due to a variety of stimulants and vitamins....
: Banzai Energy Ice, which it created with using the then popular energy drink Banzai
Banzai
Banzai may refer to:* A traditional Japanese exclamation meaning "Ten thousand years"** Banzai charge or banzai attack, a last, desperate military charge* Banzai! , a 1991 album by Tigertailz...
. Though the 4-ounce product received good reviews for its citrus flavor and convenient squeeze-up container for on-the-go consumer, the product was a financial failure and was dropped.