| Type | Subsidiary of Kraft Foods |
|---|---|
| Industry | Confectionery |
| Founded | Birmingham, UK (1824) |
| Headquarters | Cadbury House, London, United Kingdom |
| Products | See list of Cadbury products |
| Revenue | £5,384 million (2008) |
| Operating income | £388 million (2008) |
| Net income | £364 million (2008) |
| Employees | 71,657 (2008)[1] |
| Parent | Kraft Foods |
| Website | Cadbury.co.uk |
Cadbury is a confectionery company owned by Kraft Foods and is the industry's second-largest globally after Mars, Incorporated.[2] Headquartered in Uxbridge, London, United Kingdom, the company operates in more than 50 countries worldwide.
The company was known as Cadbury Schweppes plc from 1969–2008 until its demerger, in which its global confectionery business was separated from its US beverage unit (now called "Dr Pepper Snapple Group").[3] It was also a constant constituent of the FTSE 100 from the index's 1984 inception until its 2010 Kraft Foods takeover.[4][5]
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In 1824, John Cadbury began selling tea, coffee, and drinking chocolate, which he produced himself, at Bull Street in Birmingham, England. He later moved into the production of a variety of cocoa and drinking chocolates, made in a factory in Bridge Street and sold mainly to the wealthy because of the high cost of production. John Cadbury became a partner with his brother Benjamin and the company they formed was called 'Cadbury Brothers of Birmingham'.[6]
The brothers opened an office in London and in 1854 they received the Royal Warrant as manufacturers of chocolate and cocoa to Queen Victoria. In the 1850s the industry received a much needed boost, with the reduction in the high import taxes on cocoa, allowing chocolate to be more affordable to everybody.
Due to the popularity of a new expanded product line, including the "Cadbury's Cocoa Essence", the company decided to cease trading in tea in 1873. Master confectioner Frederic Kinchelman was appointed to share his recipe and production secrets with Cadbury, which led to an assortment of chocolate covered products.
Taking over the business in 1861, John Cadbury's sons Richard and George decided in 1878 that they needed new premises. Better transport access for milk that was inward shipped by canal, and cocoa that was brought in by rail from London, Southampton and Liverpool docks was taken into consideration. With the development of the Birmingham West Suburban Railway along the path of the Worcester and Birmingham Canal, they acquired the Bournbrook estate, comprising 14.5 acres (5.9 ha) of countryside 5 miles (8.0 km) south of the outskirts of Birmingham. Located next Stirchley Road railway station, which itself was opposite the canal, they renamed the estate Bournville and opened the Bournville factory the following year.
In 1893, George Cadbury bought 120 acres (49 ha) of land close to the works and planned, at his own expense, a model village which would 'alleviate the evils of modern more cramped living conditions'. By 1900 the estate included 313 cottages and houses set on 330 acres (130 ha) of land. As the Cadbury family were Quakers there were no pubs in the estate;[7] in fact, it was their Quaker beliefs that first led them to sell tea, coffee and cocoa as alternatives to alcohol.[8]
In 1905, Cadbury launched its Dairy Milk bar, with a higher proportion of milk than previous chocolate bars, and it became the company's best selling product by 1913. Fruit and Nut was introduced as part of the Dairy Milk line in 1928, soon followed by Whole Nut in 1933. By this point, Cadbury was the brand leader in the United Kingdom. These were accompanied by several other products: Flake (1920), Cream-filled eggs (1923), Crunchie (1929) and Roses (1938).[9] Cadbury's Milk Tray was first produced in 1915 and continued in production throughout the remainder of the First World War. More than 2,000 of Cadbury's male employees joined the Armed Forces and to support the war effort, Cadbury provided clothing, books and chocolate to soldiers. After the war, the Bournville factory was redeveloped and mass production began in earnest. In 1918, Cadbury opened their first overseas factory in Hobart, Tasmania and in 1919 undertook a merger with J. S. Fry & Sons, another chocolate manufacturer, resulting in the integration of well-known brands such as Fry's Chocolate Cream and Fry's Turkish Delight.[6] During World War II, parts of the Bournville factory were turned over to war work, producing milling machines and seats for fighter aircraft. Workers ploughed football fields to plant crops. As chocolate was regarded as an essential food, it was placed under government supervision for the entire war. The wartime rationing of chocolate ended in 1949, and normal production resumed. Cadbury subsequently built new factories and had an increasing demand for their products.[6]
Cadbury merged with drinks company Schweppes to form Cadbury Schweppes in 1969.[10]
Cadbury Schweppes went on to acquire Sunkist, Canada Dry, Typhoo Tea and more. In the US, Schweppes Beverages was created and the manufacture of Cadbury confectionery brands was licensed to The Hershey Company.
Snapple, Mistic and Stewart's (formerly Cable Car Beverage) were sold by Triarc to Cadbury Schweppes in 2000 for $1.45 billion.[11] In October of that same year, Cadbury Schweppes purchased Royal Crown from Triarc.[12]
In March 2007, it was revealed that Cadbury Schweppes was planning to split its business into two separate entities: one focusing on its main chocolate and confectionery market; the other on its US drinks business.[13] The demerger took effect on 2 May 2008, with the drinks business becoming Dr. Pepper Snapple Group Inc.[3] In December 2008 it was announced that Cadbury was to sell its Australian beverage unit to Asahi Breweries.[14]
In October 2007, Cadbury announced the closure of the Somerdale Factory, Keynsham, formerly part of Fry's. Between 500 and 700 jobs were affected by this change. Production transferred to other plants in England and Poland.[15]
In 2008 Monkhill Confectionery, the Own Label trading division of Cadbury Trebor Bassett was sold to Tangerine Confectionery for £58million cash. This sale included factories at Pontefract, Cleckheaton and York and a distribution centre near Chesterfield, and the transfer of around 800 employees.[16]
In mid-2009 Cadbury replaced some of the cocoa butter in their non-UK chocolate products with palm oil. Despite stating this was a response to consumer demand to improve taste and texture, there was no "new improved recipe" claim placed on New Zealand labels. Consumer backlash was significant from environmentalists and chocolate lovers. By August 2009, the company announced that it was reverting to the use of cocoa butter in New Zealand.[17] In addition, they would source cocoa beans through Fair Trade channels.[18] In January 2010 prospective buyer Kraft pledged to honour Cadbury's commitment.[19]
On 7 September 2009 Kraft Foods made a £10.2 billion (US$16.2 billion) indicative takeover bid for Cadbury. The offer was rejected, with Cadbury stating that it undervalued the company.[20] Kraft launched a formal, hostile bid for Cadbury valuing the firm at £9.8 billion on 9 November 2009.[21] Business Secretary Peter Mandelson warned Kraft not to try to "make a quick buck" from the acquisition of Cadbury.[22] On 19 January 2010, it was announced that Cadbury and Kraft Foods had reached a deal and that Kraft would purchase Cadbury for £8.40 per share, valuing Cadbury at £11.5bn (US$18.9bn). Kraft, which issued a statement stating that the deal will create a "global confectionery leader", had to borrow £7 billion (US$11.5bn) in order to finance the takeover.[23]
The Hershey Company, based in Pennsylvania, manufactures and distributes Cadbury-branded chocolate (but not its other confectionery) in the United States and has been reported to share Cadbury's "ethos".[24] Hershey had expressed an interest in buying Cadbury because it would broaden its access to faster-growing international markets.[25] But on 22 January 2010, Hershey announced that it would not counter Kraft's final offer.[26][27][28]
The acquisition of Cadbury faced widespread disapproval from the British public, as well as groups and organisations including trade union Unite,[29] who fought against the acquisition of the company which, according to Prime Minister Gordon Brown, was very important to the British economy.[30] Unite estimated that a takeover by Kraft could put 30,000 jobs "at risk",[24][31][32] and UK shareholders protested over the Mergers and Acquisitions advisory fees charged by banks. Cadbury's M&A advisers were UBS, Goldman Sachs and Morgan Stanley.[33][34][35] Controversially, RBS, a bank 84% owned by the United Kingdom Government, funded the Kraft takeover.[36][37]
On 2 February 2010, Kraft secured over 71% of Cadbury's shares thus finalising the deal.[38] Kraft had needed to reach 75% of the shares in order to be able to delist Cadbury from the stock market and fully integrate it as part of Kraft. This was achieved on 5 February 2010, and the company announced that Cadbury shares would be de-listed on 8 March 2010.[39]
On 3 February 2010, the Chairman Roger Carr, chief executive Todd Stitzer and chief financial officer Andrew Bonfield[40] all announced their resignations. Stitzer had worked at the company for 27 years.[41]
On 9 February 2010, Kraft announced that they were planning to close the Somerdale Factory, Keynsham, with the loss of 400 jobs.[42] The management explained that existing plans to move production to Poland were too advanced to be realistically reversed, though assurances had been given regarding sustaining the plant. Staff at Keynsham criticised this move, suggesting that they felt betrayed and as if they have been "sacked twice".[43] On 22 April 2010, Phil Rumbol, the man behind the famous Gorilla advertisement, announced his plans to leave the Cadbury company in July following Kraft's takeover.[44]
In June 2010 the Polish division, Cadbury-Wedel, was sold to Lotte of Korea. The European Commission made the sale a condition of the Kraft takeover. As part of the deal Kraft will keep the Cadbury, Hall's and other brands along with two plants in Skarbimierz. Lotte will take over the plant in Warsaw along with the E Wedel brand.[45]
| Founded | 1824 |
|---|---|
| Headquarters | Bournville, Birmingham, United Kingdom |
The confectionery business in the UK is called Cadbury UK (formerly Cadbury Trebor Bassett) and, as of August 2004, had eight factories and 3,000 staff in the UK. Biscuits bearing the Cadbury brand, such as Cadbury Fingers, are produced under licence by Burton's Foods. Cadbury also owns Trebor Bassett, Fry's, Maynards and Halls. Ice cream based on Cadbury products, like 99 Flake, is made under licence by Frederick's Dairies. Cadbury cakes and chocolate spread are manufactured under licence by Premier Foods, but the cakes were originally part of Cadbury Foods Ltd with factories at Blackpole in Worcester and Moreton on the Wirral with distribution depots throughout the UK.
Other Kraft subsidiaries in the UK include: Cadbury Two LLP, Cadbury UK Holdings Limited, Cadbury US Holdings Limited, Cadbury Four LLP, Cadbury Holdings Limited, and Cadbury One LLP.
| Founded | 1932 |
|---|---|
| Headquarters | Coolock, Dublin, Ireland |
Cadbury Ireland Limited is based in Coolock in Dublin. Cadbury opened their first Irish factory in Ossary RD., Dublin in 1933, when the company manufactured and sold just three products. Today, it exports over 200 of its products to 30 countries worldwide, making a contribution of €110 million of Irish trade. Cadbury Ireland uses local ingredients. More than €250 million worth of Cadbury chocolate is produced in Ireland, is exported every year, bringing Ireland valuable earnings from abroad.
Cadbury Ireland operates three factories in Ireland with two in Dublin, in Coolock (where the headquarters of Cadbury Ireland are located) and Tallaght. The third is in Rathmore, County Kerry. Products made by Cadbury in Ireland include Cadbury Dairy Milk, Wispa, Flake, and Crunchie.
| Founded | December 2002 |
|---|---|
| Headquarters | Parsippany-Troy Hills, New Jersey, United States |
| Products | Trident, Certs, Chiclets, Halls (cough drop) |
Cadbury Adams produces candy, gum, breath mints and cough drops. It is headquartered in Parsippany, New Jersey. The company was formed after the then Cadbury Schweppes purchased the Adams brand from Pfizer in December 2002 for US$4.2 billion. In Canada, Cadbury Adams also produces hydrogenated oil products and chocolates such as the Caramilk bar, Cadbury Mr. Big, Dairy Milk, Cadbury Mini Eggs and Wunderbar.
American Chicle was purchased by Warner-Lambert in 1962; Warner-Lambert renamed the unit Adams in 1997 and merged with Pfizer in 2000.
Cadbury merged with Peter Paul in 1978.[46] Ten years later Hershey acquired the chocolate business from Cadbury.[46] Accordingly, although the Cadbury group's chocolate products have been sold in the US since 1988 under the Cadbury name, the chocolate itself has been manufactured by Hershey. Prior to the May 2008 demerger, the North American business also contained beverage unit Cadbury Schweppes Americas Beverages. In 1982, Cadbury Schweppes purchased the Duffy-Mott Company.[47]
Cadbury Adams products include:
Cadbury operates three Australian factories as well as one in New Zealand; two in Melbourne, Victoria (Ringwood and Scoresby), one in Hobart, Tasmania (Claremont), and one in Dunedin, New Zealand. The Claremont factory was once a popular tourist attraction and operated daily tours; however, the factory ceased running full tours mid-2008, citing health and safety reasons.[48] Cadbury has been upgrading its manufacturing facility at Claremont, Tasmania, Australia, since 2001 [49]
On 27 February 2009 the confectionery and beverages businesses of Cadbury Schweppes in, Australia were formally separated and the beverages business began operating as Schweppes Australia Pty Ltd In April 2009, Schweppes Australia was acquired by Asahi Breweries.[50] Cadbury Australia Pty Limited
| Founded | 19 July 1948 |
|---|---|
| Headquarters | Mumbai, India |
| Key people | Anand Kripalu, Managing Director[51] |
| Products | Cadbury Dairy Milk, 5-star, Perk, Gems, Eclairs ,Oreo and Bournvita |
| Employees | 2000 |
Cadbury India began its operations in India in 1948 by importing chocolates. It now has manufacturing facilities in Thane, Induri (Pune) and Malanpur (Gwalior), Bangalore and Baddi (Himachal Pradesh) and sales offices in New Delhi, Mumbai, Kolkata and Chennai. The corporate head office is in Mumbai. Since 1965 Cadbury has also pioneered the development of cocoa cultivation in India. For over two decades, Cadbury has worked with the Kerala Agricultural University to undertake cocoa research.[52][53] Cadbury was incorporated in India on 19 July 1948. Currently, Cadbury India operates in four categories: chocolate confectionery, milk food drinks, candy and gum category. It has five company owned manufacturing facilities at Thane, Induri (Pune) and Malanpur (Gwalior), Bangalore and Baddi (Himachal Pradesh) and 4 sales offices (New Delhi, Mumbai, Kolkata and Chennai). It products include Cadbury Dairy Milk, 5-star, Perk, Gems, Eclairs, Bournvita,[54] Celebrations and Bilkul [55]
It is the market leader in Chocolate Confectionery business with a market share of over 70%.[56] The Brand Trust Report, India Study, 2011 published by Trust Research Advisory ranked Cadbury in the top 100 most trusted brands list.
Other Kraft subsidiaries including the Cadbury name include[57]
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In 2008 Todd Stitzer, Cadbury's CEO, was paid a £2,665,000 bonus. Combined with his annual salary of £985,000 and other payments of £448,000 this gives a total remuneration of over £4 million.[58]
In July 2007, Cadbury Schweppes announced that it would be outsourcing its transactional accounting and order capture functions to Shared Business Services (SBS) centres run by a company called Genpact, (a businesses services provider) in India, China, and Romania. This was to affect all business units and be associated with U.S. and UK functions being transferred to India by the end of 2007, with all units transferred by mid-2009. Depending on the success of this move, other accounting Human Resources functions may follow. This development is likely to lead to the loss of several hundred jobs worldwide, but also to several hundred jobs being created, at lower salaries commensurate with wages paid in developing countries.[59]
Major chocolate brands produced by Cadbury include the bars Dairy Milk, Crunchie, Caramel, Wispa, Boost, Picnic, Flake, Curly Wurly, Chomp, and Fudge; chocolate Buttons; the boxed chocolate brand Milk Tray; and the twist-wrapped chocolates Heroes.
As well as Cadbury's chocolate, the company also owns Maynards and Halls, and is associated with several types of confectionery including former Trebor and Bassett's brands or products such as Liquorice Allsorts, Jelly Babies, Flumps, Mints, Dolly Mix, Black Jack chews, Trident gum, and Softmints.
Notable product introductions include:
In May 2011 the model Naomi Campbell described the new advertisement for the Bliss bar as 'insulting and hurtful'. Reacting to the advertisement, which had the tag line Move over Naomi – there is a new diva in town, Campbell said, "I am shocked. It's upsetting to be described as chocolate, not just for me, but for all black women and black people. I do not find any humour in this."[60] A spokesperson for the company insisted that the campaign was "a light-hearted take on the social pretensions of Cadbury Dairy Milk Bliss". The campaign was, he later added, "no longer in circulation... we have no plans to repeat the campaign."
Reacting to Campbell's outburst, comedian Reginald D. Hunter, on the BBC television comedy quiz Have I Got News For You, suggested that it was complimentary for black people to be compared to chocolate, and that enjoyment of the Bliss bar might even be enhanced by a love of black people.[61]
On 19 January 2006, Cadbury Schweppes detected a rare strain of the Salmonella bacteria, affecting seven of its products, said to have been caused by a leaking pipe. The leak occurred at its Marlbrook plant, in Herefordshire, which produces chocolate crumb mixture; the mixture is then transported to factories at Bournville and formerly Somerdale to be turned into milk chocolate.[62]
Cadbury Schweppes officially notified the Food Standards Agency, shortly after which it recalled more than a million chocolate bars.[62]
In December 2006, the company announced that the cost of dealing with the contamination would reach £30 million.[63][64]
In April 2007, Birmingham City Council announced that it would be prosecuting Cadbury Schweppes in relation to three alleged offences of breaching health and safety legislation. An investigation being carried out at that time by Herefordshire Council led to a further six charges being brought.[63] The company pleaded guilty to all nine charges,[65][66] and was fined 1 million pounds at Birmingham Crown Court—the sentencing of both cases was brought together.[67] Analysts have said the fine is not material to the group, with mitigating factors limiting the fine being that the company quickly admitted its guilt and said it had been mistaken that the infection did not pose a threat to health.[67]
On 10 February 2007, Cadbury announced they would be recalling a range of products due to a labelling error. The products were produced in a factory handling nuts, potential allergens, but this was not made clear on the packaging. As a precaution, all items were recalled.[68]
On 14 September 2007, Cadbury Schweppes investigated a manufacturing error over allergy warning, recalling for the second time in two years thousands of chocolate bars. A printing mistake at Somerdale Factory resulted in the omission of tree nut allergy labels from 250 g Dairy Milk Double Chocolate bars.[69]
On 29 September 2008 Cadbury withdrew all of its 11 chocolate products made in its three Beijing factories, on suspicion of contamination with melamine. The recall affected the mainland China markets, Taiwan, Hong Kong and Australia.[70] Products recalled included Dark Chocolate, a number of products in the 'Dairy Milk' range and Chocolate Éclairs.[71]
Cadbury continues to use hydrogenated oils in many of its signature products. Although trans fats are present, the nutrition labels round the values down to zero.[72]
Cadbury's headquarters (Head Office UK) is the Cadbury House in the Uxbridge Business Park in Uxbridge, London Borough of Hillingdon, England.[73] Cadbury occupies 84,000 square feet (7,800 m2) of space in its head office, which is Building 3 of the business park.[74] Cadbury, which leases space in the building it occupies, had relocated from central London to its current head office.[75]
Cadbury's previous head office was in 25 Berkeley Square in Mayfair, City of Westminster. In 1992 the company leased the space for £55 per 1 square foot (0.093 m2).[74] In 2002 the company agreed to pay £68.75 per square foot. The Daily Telegraph reported in 2007 that the rent was expected to increase to a "three-figure sum." In 2007 Cadbury Schweppes had announced that it was moving to Uxbridge to cut costs. As of that year the head office had 200 employees.[76] After the Kraft Foods acquisition of Cadbury, Kraft announced that the Cadbury head office would remain the "Cadbury House."[77]
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