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Poll shows recalls of Chinese goods spark little change in consumer behavior

BY Adam Kraemer

NEW YORK Despite the recent furor over the quality of Chinese goods being imported into the U.S., sometimes even resulting in recalls, it has not greatly affected the buying behavior of the American public, a New York Times/CBS News poll discovered.

The poll, conducted Oct. 12-16, found that while 71 percent of the 1,282 respondents claimed to be aware of the country of origin of a product, nearly as many—65 percent—had not stopped buying Chinese goods. Of the rest, 14 percent claimed to have stopped buying Chinese goods because of the recent recalls and 9 percent claimed that they simply did not buy goods from China.

In addition, 35 percent said they felt that products imported from China were more dangerous than those from other countries. However, 20 percent more of the respondents (and the majority at 55 percent) felt that Chinese products only seemed more dangerous because of the recent news.

Even more telling, in comparison with a Gallup/CNN/USA Today poll from 1996, the percentages who rated Chinese goods on a scale from “Excellent” to “Poor” remained within the current poll’s margin of error of 3 points. The percent who responded “Only Fair” did not change at all from 11 years ago. The percent who rated the goods “Poor” in 2007 increased by 3 percent, but that was balanced by the combined increase of 3 percent on the side of “Excellent” and “Very Good.”

Full results and the poll’s methodology are available at nytimes.com/polls.

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Neilsen estimates more than $2 billion spent on Halloween candy in the U.S.

BY Allison Cerra

SCHAUMBURG, Ill. The Nielsen Co. has unmasked the truth about Halloween candy.

The global information and media company anticipates that U.S. consumers will spend over $2 billion on candy this Halloween, and that sizes do not matter, but rather, the quantity.

“There’s no doubt about it; when doorbells ring October 31, consumers respond with candy, and lots of it,” said Todd Hale, senior vice president of Consumer and Shopping Insights, Nielsen Consumer Panel Services. “The quantities are big, but the sizes are small. Our review of the Halloween seasons shows that the overwhelming majority of consumers choose to give miniature candy to trick-or-treaters.”

Nielsen also concluded that, out of 52 markets in the United States, the Salt Lake City/ Boise metropolitan area bought 80 percent more candy than expected.

Nielsen did say, however, despite the profits stores make on selling candy (October and April are the biggest candy-selling months), most consumers are more likely to purchase candy only a few days prior to the holiday (Oct. 29 is considered the top-selling day).

Additionally, 97 percent of households purchase candy at least once a year, while 85 percent of candy is purchased in grocery stores.

“For retailers and manufacturers, Halloween is a concentrated selling period for seasonal items,” Hale said. “Consumers [are] putting a strong showing at the cash register.”

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Hershey announces drop in Q3 profits; points to rising dairy costs

BY Allison Cerra

HERSHEY, Pa. Hershey Co. has a bellyache from the rise of dairy costs.

Known as the largest candy maker in the U.S., the company reported that its third-quarter profit plunged 66 percent and sales unexpectedly fell as it lost its market share.

Net income declined to $62.8 million, or 27 cents per share. Sales dropped 1.2 percent to $1.4 billion. The company, which accounts 11 percent of its sales outside the U.S., had not disclosed the impact the weaker dollar had on earnings.

The candymaker has experienced several setbacks over the past few years. On Oct. 5, the company announced a new chief executive officer would replace Richard H. Lenny by Dec. 1.

During his years at the helm, the company did not recover from its stumble last year while attempting to put more emphasis on what it considered a “fast growing, high-margin segment”: organic and dark chocolates.

In the midst of these impediments, Lenny had sought to expand Hershey’s reach with joint ventures in Asia to keep up with competitors. Additionally, Hershey announced it would close six U.S. and Canadian plants and cut more than 3,000 workers in the two countries, including 900 total at its namesake town, and shift more of its production to contractors and a new plant under construction in Mexico.

Meanwhile, Mars Company, Hershey’s main rival, has trumped the competition by increasing its share of the U.S. candy market through the sale and distribution more varieties of its notable candy, M&Ms, among others.

Hershey increased prices in April for the first time in two years. The price increase had “little impact” on the quarter because it was cancelled out by discounts Hershey had previously promised to retailers, chief financial officer Bert Alfonso said on the financial earnings call.

Hershey shares dropped $1.21 to $43.08 in New York Stock Exchange composite trading Wednesday afternoon.

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