Austrian chocolate icon crumbles under financial pressure
Franz Hauswirth, an Austrian producer of chocolate Santas and bunnies, has declared bankruptcy. The company's debt has reached 7 million euros.
The financial problems for the candy manufacturer stem from rising costs of raw materials, energy, and wages, along with the effects of the pandemic.
The end of Austrian chocolate Santas: rising costs
Franz Hauswirth, founded in the 1940s, exported its products to more than 30 countries. It is currently struggling with debt amounting to 7 million euros (approximately 30.3 million CAD).
Despite financial problems, the Austrian company hopes for a restructuring that could preserve jobs for around 120 employees.
Across Europe, the confectionery sector is grappling with rising cocoa prices, straining manufacturers' financial stability. In recent months, the cost of cocoa has risen sharply. Krzysztof Pawiński, CEO of Maspex, compared the increased value of a packet of DecoMorreno to an investment-worthy asset during an interview with Businessinsider.
Prices have fallen to over $8,000 CAD per tonne, but that's still twice as much as in 2023. Manufacturers are also burdened by a hike in sugar prices (about 20%). This has made candies and desserts the second-fastest rising products in terms of price.
Problems for European candy manufacturers: wedel explains
It's not just Franz Hauswirth encountering issues. German companies Leysieffer Genusskultur GmbH and Kessko are also facing difficulties. French producer Chocolat Poulain avoided closure thanks to a takeover by Andros.
